Agriculture Committee on Oct. 26th, 2022

[Dr. Sylvain Charlebois]

Actually, I think it's a valuable concept. I would go even further. There's been some work now in Canada regarding upcycling in food. That's the other avenue that I think needs some attention. I think there are some values there.

I was speaking earlier about recovering, rescuing food across the supply chain. Upcycling food is a concept that, I think, has a lot of value. It could actually eliminate more food waste across the supply chain, repurposing waste into new products for the market. Those are the discussions.

I applaud the current government for focusing more on food waste. Some of the programs that have come out of Ottawa have been very strong.

[Rechie Valdez, Liberal, Mississauga—Streetsville, ON]

Thank you.

I'm curious to know whether you've published any documentation on fertilizer.

[Dr. Sylvain Charlebois]

No, recently I have not. We haven't looked into....

Do you mean in terms of the economics of the use of fertilizers, in particular?

[Rechie Valdez, Liberal, Mississauga—Streetsville, ON]

Yes, that's correct.

[Dr. Sylvain Charlebois]

No, we have not.

I think our last report on fertilizers was when I was in Saskatchewan, many years ago, over a decade ago.

[Rechie Valdez, Liberal, Mississauga—Streetsville, ON]

Thank you.

Mr. Chair, do I have some more time?

[The Vice-Chair, Conservative, John Barlow]

You have 20 seconds.

[Rechie Valdez, Liberal, Mississauga—Streetsville, ON]

In that case, thank you to all the witnesses.

[The Vice-Chair, Conservative, John Barlow]

Thank you very much, Mrs. Valdez.

That will wrap up our first panel.

We'll suspend for a couple of minutes, grab some food or a drink. We'll try to get back as quickly as we can and get through our opening statements from our witnesses before we have to take a quick break to vote, if that will work.

To our witnesses, thank you very much for your testimony and your time here with us this afternoon. It's been very informative, and we appreciate your participation.

With that, we'll suspend for five minutes.

[The Vice-Chair, Conservative, John Barlow]

Colleagues, we'll get started again. If we plan this well and we get rolling, we should be able to match this up so that we finish our witness testimony and then are able to take a quick break to vote. I know most of our witnesses have been here, but I will just go through this as quickly as I can to try to stay on time.

Welcome to our continuing study on domestic food insecurity. That's a bit of a specific on what we've been doing as part of our work at the Standing Committee on Agriculture and Agri-Food. This meeting is taking place in a hybrid format that you can watch on the website if you so wish.

Witnesses, you can speak in the language of your choice. There is translation. If for some reason translation ends, I will stop you and we'll make sure we get that back up and running and then we'll proceed. As part of that, please speak slowly and clearly for the benefit of our translators to ensure that they are able to do their jobs as well. I will recognize you, so please don't start speaking until I recognize you by name. For those of you who are with us online, please click on your microphone icon to start speaking when it's your turn to get off mute. For those of you who have been here before, you know that your microphone will likely come on by itself and you won't have to worry about it.

I will now introduce our witnesses for the second panel. With the Canadian Agri-Food Trade Alliance is Claire Citeau. From Saskatchewan Wheat Development Commission, we have Brett Halstead via video conference. From Second Harvest, we have Lori Nikkel.

Thank you all for coming. You will each have five minutes for your opening remarks, and then we'll carry on with our questions from the floor. Now we will proceed with Ms. Citeau for five minutes.

Go ahead, please.

[Claire Citeau, Executive Director, Canadian Agri-Food Trade Alliance]

Thank you, Mr. Chair.

My name is Claire Citeau and I'm the Executive Director of the Canadian Agri-Food Trade Alliance, the voice of Canadian agri-food exporters.

Access to food should know no boundaries. Given that our mandate is focused on trade liberalization, I will speak to the matter of global food security and Canada's role from a trade policy perspective.

Allow me to share three highlights. International trade is essential for food security and nutrition. It provides livelihoods to millions and plays an important role in the sustainability of the food system. It is crucial that the trade policy environment is transparent, predictable and science- and rules-based. Policy-makers should refrain from using export restrictions and instead reorient support policies toward investments in productivity, sustainability and resilience.

We are the fifth-largest global agri-food exporter. Countries around the world depend on Canada for their food security. The agri-food sector is export-oriented, as we sell abroad more than half of the products we make to more than 150 countries. For example, anywhere from 50% of our beef to 90% of our pulses end up on plates around the world.

To ensure that Canadian agri-food can continue to play an important role in global food security, exporters must have competitive access to markets guided by the principles of free and rules-based trade. International trade serves as the backbone of Canada's food sector and the global food system. It serves as the bridge to get products from where they are grown to where they are needed. In doing so, trade enables food security while creating economic opportunities for producers, farmers and SMEs. Trade is also a key factor in the sustainable and efficient use of scarce global resources.

According to the Potsdam Institute and cited by the World Trade Organization, today one in six people around the world depend on international trade to be fed. This number will be around 50% of humanity by 2050, hence the need for more and better trade. All too often, international markets for food function poorly, owing to problems like trade-distorting subsidies and various forms of protection. Food export restrictions can be highly damaging too and may decrease domestic prices temporarily. They destabilize markets and ultimately lead to higher prices elsewhere. The fragility of the trading system harms Canada's ability to be the breadbasket to the world that we aspire to be.

I will share a few recommendations, on behalf of CAFTA, for policy-makers.

First, diversify and keep agri-food markets open. This was instrumental in avoiding food shortages during the 2008 financial crisis, as well as since the start of the pandemic. We must ensure that we do not slide backward and retreat by allowing barriers in the name of food security.

Second, limit export restrictions. Policy-makers should refrain from using export restrictions and prohibitions on agri-food trade in line with the ministerial declaration at MC12 and the call last month by major multilateral agencies to minimize distortions, market interventions and subsidies. Today the restrictions on food, feed and fertilizers in 52 countries around the globe remain a major source of concern.

Third, invest in transparency to minimize disruptions. In times of crisis, countries around the world have demonstrated an ability to provide information and notifications of measures adopted in a relatively timely and transparent manner. Such practices should remain in place and be made permanent for sanitary, phytosanitary and technical measures that affect agri-food trade.

Fourth, facilitate trade. Policy-makers should enhance the implementation of the SPS agreement, again in line with the ministerial declaration at MC12; support greater regulatory co-operation and harmonization of standards; and engage with the private sector to reduce compliance costs and expedite the adoption of digital solutions and tools.

Fifth, reorient existing subsidy policies. The latest OECD report on agriculture policy found that, in most cases, existing domestic support in agri-food distorts trade without providing effective solutions to food security and sustainability. It also suggests that, instead, public spending should be shifted towards investments in food and agriculture innovation and improving food supply chain infrastructure and resilience.

Sixth and last, reinstate the WTO's appellate body. This is the core of the function of the WTO, and it holds the key to stability, security and predictability to conduct global trade.

In closing, I’ll reiterate that access to food should know no boundaries. Ultimately, global food security is a security issue.

Agricultural trade can feed people, the planet and the economy, but it can only happen through global co-operation and better predictability and security in the multilateral trading system.

As the industry is set to increase exports, our members look to the government to continue to open doors and champion regulations that will allow the industry to remain competitive globally, as well as work to limit the use of regulatory approaches that restrict trade and enact barriers. We need to be essentially quicker to the market with products and policy solutions.

Ultimately, with the right policy choices, Canada today has an immense opportunity to seize, one that will help the world and strengthen Canada’s place in the world and Canada's competitiveness as an agri-food exporter.

Thank you.

[The Vice-Chair, Conservative, John Barlow]

Thank you, Ms. Citeau. I appreciate that.

Now I will move to Mr. Halstead for five minutes, please.

[Brett Halstead, Board Chair, Saskatchewan Wheat Development Commission]

Thank you, Mr. Chair and members of the committee, for the opportunity to speak from the perspective of Saskatchewan wheat farmers.

I'm Brett Halstead, chair of the board of directors of Sask Wheat. I'm a grain and livestock producer from Nokomis, Saskatchewan.

Sask Wheat is a producer-led levy organization representing about 24,000 wheat and durum producers. We identify and support research, market development and advocacy efforts that contribute to profitable and sustainable wheat production. Since 2014, we have committed about $52 million to those research projects.

We are partners in a multi-year, multi-million dollar successful funding partnership with AAFC wheat variety breeding programs through the Canadian Wheat Research Coalition. These investments have made important contributions to Canadian and global food security and to economic, social and environmental sustainability.

The federal government recently emphasized the importance of Canadian agriculture and agri-food exports as both a critical sector of our economy and as part of a solution to global food insecurity. Canada is responsible for about 12% of global wheat trade annually, exporting 80% of our total production. In 2022, Saskatchewan's largest crop planted was wheat, which accounted for nearly half of all Canadian acres of wheat. This shows the importance of Saskatchewan wheat to the global food security situation. Saskatchewan wheat producers are very successful at providing a high-quality sustainable food source to the world with large positive impacts on global food security.

Saskatchewan wheat must be competitive in global markets. Saskatchewan wheat producers are price-takers. They receive the global price minus the cost of exporting to be competitive, profitable and sustainable. Saskatchewan wheat producers must rely on their productivity and efficiency.

There are two areas of concern that I want to address today. I probably don't have time for the grain transportation. I want to talk mainly about the increasing environmental policy and regulatory burden that we face. Over the past 30 years, Saskatchewan producers have been global leaders in the adoption of sustainable practices such as reduced tillage, continuous cropping and more. We have sequestered vast amounts of carbon in our soil and have reduced the total amount of land dedicated to our crop while producing more on those acres. However, Sask Wheat is concerned with environmental policies that we believe place an unfair burden on our export-oriented producers in pursuit of poorly defined national environmental objectives.

These policies will increase farmers' costs with no ability to offset them. International competitiveness will suffer. This will favour our global competitors, some of whom have little or no commitment to sustainable production. The federal carbon tax, we believe, unfairly increases direct and indirect costs of production of exports by Saskatchewan producers. The significant additional costs producers will incur cannot be passed along to our customers. Proposed carbon tax rebates will not offset those increases. Fertilizer is essential to increasing production to improve global food security. The committee has recommended that the Government of Canada ensure access to affordable fertilizer to maximize yield benefits.

One of the proposed solutions is enhanced-efficiency fertilizers. However, they are more expensive and do not increase yields. If reaching emissions targets depends on their use, then this means we could have increased costs without corresponding increased revenues. Sask Wheat advocates having science-based policy and programs across the government. This requires investment in science. Policy-makers must recognize the current limitations of scientific knowledge, the data and the regional and individual levels regarding fertilizer emissions. Farmers need adequate scientific support to economically and practically accomplish environmental objectives within reasonable time frames.

In conclusion, Sask Wheat supports the goal of increasing Canadian agriculture sector revenues. It is important both for the Canadian economy and for increasing global food security. High-quality, high-protein sustainably produced wheat is a key component of this global diet and increasingly so amid global trade uncertainties and food insecurity.

However, Saskatchewan wheat producers require policies and regulations, programs and funding that enable profitable production and access to global markets. Saskatchewan wheat producers must be profitable to be sustainable. We must be globally competitive to be profitable.

Thank you.

[The Vice-Chair, Conservative, John Barlow]

Thank you very much, Mr. Halstead.

Now I'll go to Ms. Nikkel for five minutes, please.

[Lori Nikkel, Chief Executive Officer, Second Harvest]

Thank you, Mr. Chair and members, for the opportunity to speak today.

Second Harvest is a non-profit, charitable organization dedicated to environmental protection and hunger relief through food redistribution, research, awareness and education. We work with thousands of food businesses from right across the supply chain to reduce the amount of edible food going to waste, preventing the unnecessary release of greenhouse gases. Our inclusive model ensures that this healthy, surplus food is redirected to thousands of charities and non-profits across the country from coast to coast to coast, making their way to the millions of Canadians experiencing food insecurity in our country.

As Canada’s largest food rescue organization, Second Harvest appreciates this committee’s focus on the issue of food insecurity and would like to take this opportunity to outline how our country’s food waste crisis is adding to the issue and how we can address it.

Fifty-eight per cent of all food produced for Canadians, approximately 35.5 million tonnes, is lost or wasted annually, bypassing the dinner tables of Canadian families and adding over 56 million tonnes of greenhouse gases to our atmosphere while, at the same, 5.6 million Canadians are food insecure.

Addressing food waste is a critical part of the issue of food insecurity. Taking action to support food waste reduction and diversion initiatives can reduce supply issues, mitigate transportation challenges, reduce CO2 emissions, lessen our reliance on imports and redistribute millions of tonnes of edible food to families and communities in need. In order to address the issue of food insecurity and its negative impact on Canadians, we are making two policy recommendations to this committee.

First, we are asking this committee to support the revival of the surplus food rescue program. The surplus food rescue program was introduced in July 2020 as part of Canada’s COVID response. Through this program, Second Harvest was able to purchase over nine million pounds of fresh surplus food like eggs, chicken, salmon and fresh produce that we then redistributed to over 350 communities across Canada. The surplus food rescue program was an example of government leadership and action that had a real impact on the lives of countless Canadians, including our producers. Unfortunately, while the program no longer exists, it is now needed more than ever.

Second, we are asking the committee to support the creation of a tax credit to incentivize Canadian businesses to reduce their food waste and provide surplus food to organizations that can redistribute it. Some provinces have already taken this step. Quebec’s tax credit resulted in an increase of fresh food being donated to food charities in the first year; however, provincial tax credits only apply to producers, meaning that over 100,000 Canadian businesses have the ability to reduce their food waste but do not have an incentive to do so.

Second Harvest commends this committee for acting on the issue of global food insecurity. Global conflicts and instability have impacted the stability and predictability of the food supply chain, and Canadians are feeling the effect. However, we have the ability to address a number of these challenges by taking action within our own borders.

It is time for us to face the uncomfortable truth that Canada has a food waste crisis, and I ask all members of this committee for their efforts and support to address this crisis head-on.

Thank you.

[The Vice-Chair, Conservative, John Barlow]

Thank you very much, Ms. Nikkel.

We're going to suspend for a couple of minutes. I know some of you have already voted, which is great. It looks like Ryan might be having a technical difficulty.

We'll just suspend for a couple of minutes to allow our colleagues to vote, and then we'll get back with the first round of questions.

[The Vice-Chair, Conservative, John Barlow]

Thanks, everyone. We will now carry on with the first round of questions.

We'll start with the Conservatives and Mr. Steinley for six minutes, please.

[Warren Steinley, Conservative, Regina—Lewvan, SK]

On that uplifting note, Mr. Chair, I'd like to ask a few questions to our panel.

Thank you very much for being here and being witnesses today.

Mr. Halstead, you had some interesting stats and you're a good Saskatchewan boy, so I would be remiss if I didn't ask you a question about these stats. You said half of the wheat crop in Canada is grown in Saskatchewan, so my question would be, if there are new fertilizer policies implemented—the government is looking at, as of now, a 30% reduction—how many more acres would you have to use to get to that same half of the Canadian wheat crop in the country in Saskatchewan? What would the effect on yields be with that new fertilizer reduction policy?

[Brett Halstead]

There are a lot of unanswered questions and misunderstandings in what's going on there. We don't have all the answers to things like that.

Going back to the seventies, we have cut the number of wheat acres down and they're growing other things in the Prairies now like canola and lentils, which have become larger crops. There isn't necessarily an answer to that, because it's a fight between individual commodities, depending on the commodity prices and the expenses, as to which crop you're going to grow. Many of those crops need a number of years on a rotation and a number of different fertilizer and input requirements, so there's no easy answer to that.

As you mentioned, we do produce nearly half the acres of wheat in this country. If you were to cut fertilizer, you would obviously have to increase the acres to produce the same, so that would have to come from somewhere else, but somewhere else is also going to want to keep their acres or the market will want to keep those acres.

[Warren Steinley, Conservative, Regina—Lewvan, SK]

Thank you very much for that.

Obviously, you mentioned the carbon tax is one of the environmental policies that producers are fighting. It is causing them to be at a competitive disadvantage. What do you see happening if that ends up going to the stated $170 a tonne? Obviously that's going to be a big crunch. Is that going to put a lot of producers at a decision point where they're asking if this is even financially viable now and whether they can make a living? Are we going to be able to do this, or are they going to leave the agriculture sector as a whole?

[Brett Halstead]

Yes, the increases could be much more devastating than what we've had. We currently have high commodity prices right now, and that's due to a number of factors, external market factors, conflicts in the world and shortages in some commodities. As you increase that, and we're seeing it with food costs too, one of the largest costs of food is transportation, and all of our products, whether we buy as inputs or we sell as an export, require transportation. Although farmers aren't directly paying that, we are indirectly paying that through our retailers.

[Warren Steinley, Conservative, Regina—Lewvan, SK]

Yes, and that's really where I was going with this line of questioning. Obviously, the carbon tax is playing a role when it comes to food security, because those transportation costs are getting passed on to consumers and fewer dollars are going to be able to be used to buy groceries in store and the price of groceries is going to be ever-increasing because that gets passed on to consumers.

Farmers are price-takers. At what point does that basically become unsustainable for a farmer who cannot pass on those prices? Like you mentioned, you take the global price when you're a farmer, so other than the carbon tax, what do you see as the next most damaging policy that you're facing right now when it comes to the federal government?

[Brett Halstead]

We don't know what a fertilizer emission target will totally entail yet. We're worried about that, and there are a lot of unanswered questions on that. That's something we're flagging. It's a consultation and discussion thing that's happening right now and it's something of great concern to us in terms of how we continue to sustainably produce if the cost of that's going to go up or if getting fertilizer is going to get harder. We don't have all those answers right now and it's a concern.

[Warren Steinley, Conservative, Regina—Lewvan, SK]

Thank you very much. I was thinking that the ability to get fertilizer would be one of those concerns.

I'm going to shift right now to you, Ms. Nikkel. You said something that was very interesting from what I caught in your presentation, which was on the GHG emissions from wasted food. If you were able to do it, what would be one of the best policies to put in place to help reduce those wasted food GHG emissions in terms of something that we could do? I find that a big number. We're talking about trying to lower emissions and about food security, and we've seen some policies that haven't actually resulted in lowering the emissions.

When it comes to food waste, what could we do to lower emissions in the near future?

[Lori Nikkel]

I think it's very simple: Mandate measurement and provide incentives. Have producers, manufacturers and retailers mandated to measure and monitor their waste, to set targets and to hit the targets, but provide incentives to do that.

As soon as you do that, we're going to lower this, because prevention is far more important than diversion. Even in upcycling, we want to prevent this at source.