Thank you, Mr. Chair.
Good afternoon. Thank you for the invitation to appear before the committee.
My name is Ian McFall. I'm here as chair of the Canadian Poultry and Egg Processors Council's board of directors. I'm joined today by CPEPC's president and CEO, Jean-Michel Laurin.
We're pleased to take part in this study on the Ukraine goods remission order. Before sharing our news on this topic, I would like to remind everyone that CPEPC represents Canadian hatcheries, egg graders and processors, chicken and turkey processors and further processors. Collectively, our membership represents more than 180 establishments of all sizes and collectively processes over 90% of the poultry and egg products raised by Canadian farmers.
First off, we want to say that we recognize the very difficult situation faced by Ukrainians and the Ukrainian agriculture and food industry and the need for our government to take a broad range of actions aimed at supporting Ukraine in these difficult times.
Before talking about the remission order specifically, let me provide some broader context on the role of imports in our industry.
As you know, poultry and egg production in Canada is governed by supply management and, for this reason, our industry's main focus is to supply the Canadian market. Supply management rests on three pillars, import controls being one of them.
Imports usually come in using quotas called TRQs. Those are set import quantities negotiated in trade agreements. They cap how much can be imported in any given year. When producers set production volumes based on Canadian market demand, they take those import volumes into account.
I should also mention that our members receive a significant share of the TRQs allocated every year. If products come into Canada outside of the quota system, our members would therefore be directly impacted.
While the remission order has been in place since June, Ukraine is not currently authorized to export poultry and egg products to Canada. CFIA briefed you on Ukraine's request to get some of their establishments certified to export to Canada and where that stands. That request to certify three Ukrainian chicken-processing plants was made in 2019, but we only became aware of it recently. We also hear that Ukraine made a similar request to export egg products to Canada.
It's also known that Ukraine is a major chicken exporter, as evidenced by the significant increase in their exports to Europe this year. Allowing Ukrainian chicken plants to export to Canada under the current remission order in a supply-managed environment could have a significant disruptive impact on Canadian processors, our suppliers and our customers. We are greatly concerned by this potential impact.
TRQ is key to managing imports and supply. Any measure that allows products to enter Canada without quota makes it very difficult to forecast imports. The market could be short if we overestimate imports or long if we underestimate how much product will come in. Either scenario could have significant impacts on different parts of our value chain. In other words, not knowing the exact quantities that could enter jeopardizes our ability to ensure the market is properly supplied.
If, following the completion of the process, CFIA issues official meat import certificates to Ukraine, it would be critical that government and industry work together to manage and mitigate risks to the supply management system. In addition, it would be critical for us to receive trade information as soon as possible. We were pleased to hear that Ukraine agreed to voluntarily share that information with CFIA before any products leave Ukraine. The government should also be ready to consider introducing a cap or safeguard measures if imports prove disruptive to the Canadian market.
Finally, if the government considers renewing the remission order in 2023, we believe it would be best to exclude supply-managed products. Poultry and egg products from Ukraine would then be allowed to enter Canada using the TRQ process.
Mr. Chair, I will end my remarks here. JM and I would be pleased to answer any questions you may have.
Thank you.