Agriculture Committee on June 12th, 2023

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

If I'm interpreting you correctly, that in itself is not a statement that could be adequately used as an argument against Bill C-280. It's great that it exists, but additional protections are needed through Bill C-280.

[Fred Webber]

That's correct.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Thank you for that.

For my next question, just for the fruit and vegetable growers, I know because of how connected our two economies are, Canada and the United States, that you have a lot of contacts down south and that may also involve members of the government in the United States Department of Agriculture and members of Congress. Is there a guarantee that, if we do embark on this path of getting Bill C-280 passed into law, we will regain preferential status under PACA?

[Quinton Woods]

As Mr. Davidson said earlier, we cannot speak on behalf of the United States. To the best of our knowledge, and what we have been told by the United States, it would definitely open the door to reciprocity again.

[Dr. Rebecca Lee]

Could I possibly redirect that to Fred Webber, because he's been more in contact with the people who would be able to answer that.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Sure.

Mr. Webber, do you want to jump in?

[Fred Webber]

Sure. Thank you, Rebecca.

There's no mystery about getting reciprocity back. It doesn't require Congress. It doesn't require anything. The Perishable Agricultural Commodities Act itself provides that, if another country has a system that is deemed to be equivalent to theirs—so the DRC satisfies part of that—and if we had an insolvency tool, it's automatic. Any other country—Mexico, Chile, South Africa—if they want to put in a DRC and come up with an insolvency tool, they too could be granted reciprocity under PACA.

I'm not sure where this idea came from that it requires an act. You're right. I worked at PACA and I know a lot of the people. We've had letters assuring us that if this happens.... It really is a—

[Yves Perron, Bloc, Berthier—Maskinongé, QC]

I am sorry to interrupt, Mr. Webber, but Mr. MacGregor has run out of speaking time.

Thank you, Mr. MacGregor.

Over to you now, Ms. Rood, for five minutes.

[Lianne Rood, Conservative, Lambton—Kent—Middlesex, ON]

Thank you very much, Mr. Chair.

We are set to lose 40% of our farmers in the next 10 years. That's a staggering statistic that we've heard recently. In many cases, the next generations in produce farming are not choosing to be in the business because of the risk associated with this industry. This is going to affect our food sovereignty, but this bill provides another tool in the tool box for our growers, for the next generations who will be growing perishable products.

Now, not all growers sell to grocery stores. Some sell to wholesalers or some sell to brokers. It's common practice in this industry for this to take place, so not all packers of produce are growers.

Mr. Woods or Dr. Lee, can you perhaps tell us why it's so important that this bill should apply to suppliers and not just to growers?

[Quinton Woods]

Thank you for the question.

I think that's very important. The reality is that the growers are the lowest common denominator on the totem pole. There's been mention made many times over the last couple of years about how a lot of what we do in our business is low margin. As we transact throughout the supply chain, we need to make sure that the next step in the supply chain is also covered. If we are selling to a wholesaler who then sells to a retailer and the retailer goes bankrupt, that wholesaler would need access to ensure that money trickles back to the grower.

I think, as the bill is written—produce growers and sellers—that is a very important statement, and it's something that we would definitely support.

[Lianne Rood, Conservative, Lambton—Kent—Middlesex, ON]

Thank you very much.

I'm going to turn my time over to Mr. Lehoux, Chair. Thank you.

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

Actually, I'll assume it for the moment.

Mr. Webber, you were finishing a question from Mr. MacGregor. Can you please complete that answer?

[Fred Webber]

I think I lost my train of thought.

It really was that there's nothing magical about this. It's a stroke of the pen. Do you satisfy the requirements under the PACA or don't you? Right now, we've been told that if we have an insolvency tool, we satisfy it and we get it back.

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

That would then also be expanded to other countries that would meet that same threshold. Is that correct?

[Fred Webber]

In reality, that's not likely to happen.

The U.S. and Canada have had regulatory backdrops for fruits and vegetables for going on a hundred years. No other country, really, has come forward and has done the dispute resolution or had the kinds of grade standards or the kind of co-operation that the U.S. and Canada have.

Yes, it's possible but not very likely.

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

Thanks.

I'm going to direct the next question to the panel that's in person here.

In a previous life, I spend some time in the processing vegetable industry negotiating contracts where terms of payment were very important. We examined competing jurisdictions with their own rules, and we found that Midwestern states often had protections for primary producers, where they place them in a superpriority position, not just as unsecured creditors.

Can you talk about the implications? Have the banks pushed back at all here in Canada? Have you had any negative push-back, let's say, because of the superpriority position as you've represented your stakeholders? Maybe we can begin with FVGC.

[Dr. Rebecca Lee]

Thank you for the question.

We have not had push-back. Informal conversations would suggest that certainly, like in the United States, having a strong client is in their interests. That's about all the discussions we've had. We haven't seen any push-back.

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

Okay. Thank you.

Is there anything, Mr. Currie, in 10 seconds? My colleague does have one question still.

[Keith Currie]

Very quickly, in our brief conversations with some financial institutions, this isn't an issue at this point, so it's not a concern yet.

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

That's excellent. Thank you.

Go ahead, Mr. Lehoux.

[Richard Lehoux, Conservative, Beauce, QC]

Thank you.

Ms. Lefebvre, you mentioned that about half of Quebec's fruit and vegetable products are exported to the United States, and that 70% of all farms, particularly in Quebec have fewer than five hectares of land.

If the bill were enacted quickly, could it help growers in various ways, including allowing them to expand their farms? Would it help smaller farms become medium-sized farms and medium-sized farms become bigger?

[Catherine Lefebvre]

Our greatest fear right now is losing farms. If the bill merely guaranteed sustainability in our sector and enabled the farms to survive, we would lose fewer growers.

[The Chair, Liberal, Kody Blois]

All right.

[Richard Lehoux, Conservative, Beauce, QC]

Thank you very much, Ms. Lefebvre.

[The Chair, Liberal, Kody Blois]

Thank you, Mr. Lehoux and Ms. Lefebvre.

Mr. Drouin, you have the floor for five minutes.