Agriculture Committee on Nov. 30th, 2023

[Dr. Harpreet S. Kochhar, President, Canadian Food Inspection Agency]

Specifically on the potato wart thing, I want to start by saying that the situation warrants our making sure there are controls in place. I want to say that 95% of the potatoes from P.E.I. are moving. There is a small segment—specifically the seed potatoes—which is a concern, and we are working on that.

You asked, Member, what we are doing on that one. Let me assure you that we are putting in place, with an understanding from the United States, the pest-free places of production.

We're also putting together a risk management plan. We are working with the P.E.I. Potato Board and the Canadian Potato Council. This is an inclusive process, so that we can actually design a program that has a surveillance activity that will prove the absence of potato wart in particular fields. We can then restore that activity.

It's a very scientific process, Chair, and we are following the international norms on that.

[John Barlow, Conservative, Foothills, AB]

Thanks for that.

I'll just conclude with this. The minister said that this is a little annoyance, and you say that 97% of the potatoes are moving. For the producers who are growing seed potatoes and it's their entire livelihood and their industry, it's not a little annoyance and it's not a little issue. It is a significant issue. It's a multi-million dollar business in P.E.I.

I would just encourage you, in your dealing with us, to understand the impact this is having on P.E.I. potato farmers. This isn't a little annoyance. This is a huge issue for those producers.

Thank you for the update.

[The Chair, Liberal, Kody Blois]

We'll turn to Mr. Carr for six minutes.

[Ben Carr, Liberal, Winnipeg South Centre, MB]

Thanks very much, Mr. Chair.

I'd like to start by addressing the fact that there's no doubt that climate change is real. We've seen clearly laid out in testimony today and from previous witnesses and reports the impact that it's having on the agriculture and agri-food industry in particular.

I was just looking at the forecast for my hometown of Winnipeg. It is going to be December next week and this is what the temperature will be in Winnipeg. It will be -2°C, -3°C, -2°C; -1°C; -2°C; -3°C; and 0°C in the first week of December in Winnipeg.

I was looking at a couple of different reports. As you may know, I'm a new member of the agriculture committee, so I'm getting caught up on things.

My Conservative colleagues often like to talk about the price on pollution and blame it for the entirety of inflation, particularly around food prices.

I just wanted to read a couple of things. One is from a report called, “Canada's Food Price Report 2023”. This was put together by the universities of Dalhousie, British Columbia, Guelph and Saskatchewan. One of the key authors of this report is someone that my colleagues like to quote often, Monsieur Charlebois.

I simply want to take a moment to reference the following on the bottom of page 15:

There is no one individual factor that can be specifically identified as the root cause of increases in food prices. Various macroeconomic factors like those identified—labour shortages...continued adverse climate events, geopolitical conflicts—all contribute to the changes seen in food prices.

Furthermore, during a study called “Grocery Affordability: Examining Rising Food Costs in Canada”, which this committee undertook prior to my taking my seat here, one of many witnesses mentioned that there “hasn't been a quarter since the Q2 of 2020 when the Canadian food price inflation has been higher than in the U.S.”

Furthermore, I will note that on the next page there is a graph that shows that not only is Canada below the G7 average in terms of the rise in grocery prices, but Canada is essentially on par with the United States.

Now, there is no price on pollution in United States jurisdictions. How can it be, then, that if food prices are relatively similar in Canada and the United States—one where there is a price on pollution and one where there is not—that the increase in food prices can be attributed to the price on pollution?

Can the deputy minister please talk to us a little about the way climate change is affecting the industry and the way in which she believes the industry, with the support of the Government of Canada, will need to adapt to what is clearly a very changing environment?

Thank you.

[Stefanie Beck]

That's a very broad question, Mr. Chair. Probably Mr. Rosser has more to add, but what it does point to is the multiple factors involved in pricing food, which I think this committee is very well aware of.

What we do in my department is analyze pretty much step by step what we can do, where we have the tools that can make a difference. That can be from the science, starting at the very beginning on how we can adapt our seed production to what is going to be necessary in the future, with very mild winters and perhaps not enough irrigation to start off the season, then a very hot season, and perhaps wildfires as well. What does that mean for the supports that farmers will need in terms of AgriRecovery, which we've been talking about, but perhaps more importantly, prevention in advance? That would be insurance that they're putting in place, better soil health, and better practices to manage the tilling and the fertilizing and the crop protection—all of the different stages involved. Once beyond the farm gate, that would be the challenges to the supply chain and what that means for pricing as well.

I'll turn it over to Mr. Rosser to add.

[Tom Rosser, Assistant Deputy Minister, Market and Industry Services Branch, Department of Agriculture and Agri-Food]

Thank you.

Mr. Chair, I have very little to add in response, other than to note that certainly there are multiple factors that affect food affordability. Climate events, not only in this country but worldwide, can affect commodity prices.

I might add that Russia's invasion of Ukraine last year led to spikes globally in grain prices, feed prices, fertilizer prices. We have seen those prices start to moderate, and as a consequence we are seeing an easing of many price indicators here in Canada.

[Ben Carr, Liberal, Winnipeg South Centre, MB]

It's very interesting, Mr. Rosser, that you mentioned the conflict between Russia and Ukraine. I recognize that this may be out of the scope of the work you are undertaking in Agriculture and Agri-Food. However, as you will know, there was recently a very important introduction of a new Canada-Ukraine free trade agreement.

Is there anything you can speak to on that agreement that would assist in lowering food prices globally or assist in any type of agricultural production in Ukraine that may see an offset benefit to Canada as a result?

[Stefanie Beck]

I would say anything that increases the export of food from Ukraine is going to help with global food prices. In particular, of course, we've seen the impact on the lack of grain shipments and the limited shipments going particularly to the most needy countries, and what that has meant in terms of global grain prices, driving up the price of bread, for instance.

Anything that will facilitate more trade with Ukraine will make a difference.

[The Chair, Liberal, Kody Blois]

We'll leave it there.

Thank you, Mr. Carr. Thank you to the officials.

Mr. Perron, you have the floor now for six minutes.

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

Thank you, Mr. Chair.

I'd like to thank our witnesses for being here. We are getting to know some of you rather well; we're beginning to think that you enjoy coming here.

My comments will relate to the discussions I had earlier with the minister, even though I know you won't be able to make comments on political matters. What I was saying to the minister was that Quebec managed to find some additional funds by offering zero-interest loans to give agricultural businesses more liquidity.

When I spoke about the Canadian Business Emergency Account, it was meant as an example of complementary investment. I'd like to say to my friend Mr. Drouin that my comments were directly related to the subject being discussed today, which is investment in agriculture.

My question is this. Have you had discussions to determine whether the federal government will join Quebec in introducing a complementary measure? Once again, I'm not talking about AgriRecovery, but rather supplementary funds that could be made available to producers.

[Stefanie Beck]

The short answer is no, not yet. However, we've been working very closely with the Quebec government, our counterparts at Quebec's ministry of agriculture, fisheries and food, in order to determine how we might offer a little more help to people who need it earlier in the process. AgriRecovery was not really designed for that. If people need short-term assistance, they should try other options like insurance or the Advance Payments Program. That would provide them with rapid assistance. AgriRecovery requires that you wait until the end of the season to analyze the program and reach a decision.

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

Thank you very much, Ms. Beck. I'm well aware of that, and that's why I'm asking you that as a separate question.

You've clearly understood the messages I sent out today. Something needs to be done to help our producers. The insurance program was mentioned, but over half of the businesses don't get on board because the program doesn't work for them. In fact, they pay more in premiums than they would be able to receive, so it's as if they weren't insured. There is some flexibility there, but I don't want to get into that in too much detail for the time being.

I understand that AgriRecovery is an emergency program that is used at the end of the season. The minister said earlier that it would be done as quickly as possible.

What kind of timeline are we talking about? People need an answer now. It may well be that that they have to wait until the end of the season, but the next season also needs to be prepared. The vegetable growers are already ordering seed for the next crops. If we keep abandoning them, they'll do something else with their land.

[Stefanie Beck]

It usually takes at least a few weeks after we've received all the documents from the province, whether it's Saskatchewan or Quebec. In fact the last time I looked at the records, we had not yet received all the ones from Quebec. We have nevertheless begun to work on analyzing the data in hand.

If the case is not very complicated, it might take a few weeks. I'd be surprised if it took any longer than that now, because we've already dealt with similar problems in other provinces. I believe it will be done before Christmas if everything goes smoothly.

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

Thank you for these brief and clear answers. I'm much obliged, Ms. Beck.

Earlier, I spoke to the minister of agriculture and agri-food about the Local Food Infrastructure Fund , the LFIF, for which changes were made on the fly.

I know that you, as an official, are not the one making the decisions. It is nevertheless disappointing for the businesses preparing applications for projects of up to $100,000. Before their applications were even looked at, they were told that their submission might be read if money were found, but that as there were too many applications, there was no money. Apparently, there's going to be a limit of $50,000 for remote regions. When I receive letters from citizens in Quebec ridings, and I go and check out the Internet site, it still says that applications can be for up to $120,000.

Something's not working at the department. I offered you some very constructive comments. These people are working for nothing. It's important to understand that they have lots to do other than paperwork.

For the various parts of the program, have you held any internal discussions about adding some funds soon?

[Stefanie Beck]

Our budget this year was only $10 million higher. It disappeared quickly. I believe we received applications for a total of $60 million or $75 million. So the program is very popular. That's also perhaps because many projects fell into the $15,000 range rather than for larger amounts. More people receive money, but it takes time to determine where the money should go because of the hundreds of applications we get.

A $10 million fund disappears quickly.

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

Thank you very much, Ms. Beck.

I understand that some optimistic announcements were made, but that the money for the fund didn't arrive.

I don't know whether you're going to be able to answer my next question.

The agri-food sector is suffering from chronic underinvestment. We've been saying that repeatedly.

Yesterday in the House of Commons, the Conservatives presented one of the reports we had adopted almost two years ago. The report recommended encouraging investment in the modernization of the agri-food sector. Earlier, my colleague Mr. Lehoux referred to the closing of a slaughterhouse in Vallée-Jonction, and that wasn't the only business shutdown we could report.

What work is being done on this? Where do you stand?

Can we expect investments, assistance and support measures, or at least something positive from the government on behalf of this industry?

[The Chair, Liberal, Kody Blois]

Ms. Beck or Mr. Rosser, you have 30 seconds to answer.

[Tom Rosser]

I'd like to thank the member for his question.

I'll answer briefly.

Yes, we worked on encouraging investment in the processing sector. For example, we have programs designed to help and support businesses that use innovative technologies.

The minister spoke this morning about the fact that there were fairly encouraging signs across the country with respect to new investments in this sector. We have targeted programs to help investors.

[The Chair, Liberal, Kody Blois]

Mr. MacGregor, you have six minutes.

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

Thank you very much, Mr. Chair.

Welcome back to the committee, everyone. We're glad to have you here.

Deputy minister, last week I met with a group of young farmers who came to talk to me specifically about the extremely high cost of land.

My riding is on Vancouver Island. It's a very desirable place to live. We sometimes have price stabilization, but the price of land always just seems to be going up and up. They really identified the fact that so many farmers are land rich and cash poor. There's a very real problem with the intergenerational transfer of that land. Often, a farmer who has been working on that land, in order to retire appropriately, has to sell at a high price because all of their assets are locked into the land. This presents a real problem.

You know, I fly with Air Canada a lot, going back and forth. Always on Air Canada there are these advertisements for an investment firm, about investing in farmland. Increasingly, a lot of farmland is being seen as a commodity, as an investment vehicle. It's a vehicle for people to make money, but we're forgetting, I think, the primary purpose, which is to feed local communities.

I understand this is a cross-jurisdictional issue, and often municipalities and provinces have to take the lead. This a pan-Canadian problem, and I think what the young farmers were telling me is that this is a problem that's present in many different provinces.

They asked me what roles the federal government and specifically AAFC can play in working with provincial counterparts to address this problem.

I'll pose that question to you.

[Stefanie Beck]

Thanks.

As a matter of fact, I met with our own advisory youth council just yesterday. I was hearing directly from them and others on the exact same issue that you raise. I guess the best thing we can do is ensure that on issues like intergenerational transfer, for instance, our colleagues at Finance Canada are ensuring that tax law reflects the challenges that we're all seeing. We're always optimistic that this will result in a better outcome for young farmers.

Anything we can do in our conversations with the provinces.... Again, I met this week with the deputy ministers of all the provinces and territories. Issues that are facing the new generation of farmers, who need to come on board, are of great concern to all of us. I can tell you with certainty that they are equally concerned about ensuring better access, especially given the incredible costs that we're seeing these days. British Columbia is probably the worst, though, unfortunately.

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

Thank you. That's a very real threat to our future food security as a nation.

I'm just switching gears here, and it's in line with what my colleague Ms. Rood asked the minister during the first hour. I was on a panel with the Canadian Produce Marketing Association last week. Of course, one of their big issues is the regulations coming from ECCC. Your department is in receipt of a letter from President Ron Lemaire, dated October 19. At the end of that letter, he had four recommendations.

Look, I live in a coastal community. I understand the dangers of plastic pollution. Our marine environment is especially at risk, and we know of the bioaccumulation of microplastics. Every time I go and catch salmon off our beautiful west coast, I know there's a good chance that there's a high degree of microplastics within the seafood that I'm catching. That's a very real threat.

That being said, the CPMA and the Fruit and Vegetable Growers have identified some very real concerns with this. I think there's a good intention here, but maybe also some unintended consequences. Technically, in the conversations you have with your ECCC counterpart, how are you trying to address their specific asks? If we're hearing threats from U.S. producers, saying they're not going to export to Canada because they can't deal with the regulatory burden and the fact that there's a very real danger of increased food waste and a danger to safe food handling, how are you addressing those concerns?

[Stefanie Beck]

We share those concerns, and of course we meet regularly with Mr. Lemaire and his colleagues as well. I'd say we're in pretty constant contact with our colleagues at ECCC to outline exactly what you've said. At the same time, we outline what we would recommend, not as solutions but at least as ways of easing possible implications and, as you say, unintended consequences. We've been very clear about what that means, not only for food safety but for food waste, which is already at appalling numbers in Canada, at over $50 billion a year. Something like that is very important.

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

May I ask what those are specifically? How are you addressing his key asks?

[Stefanie Beck]

For instance, with respect to plastics that will have to come into direct contact with food—beef would be one of those products, but also fruits and vegetables—what are the alternatives, and how long is it going to take for us to get there? I obviously don't have control over everything, but what can we do to support the industries that are coming up with compostable plastics that will make a difference?

At the same time, we are speaking with other countries. While we may be in the lead at this point in time on plastics, and although I gather some of that's under review right now, pretty soon the Americans and others will come on board too. We're not going to be out in front all alone for a very long time.