Agriculture Committee on June 9th, 2026

Liberal

The Chair Liberal Michael Coteau

Thank you very much.

Next we'll go to the Fruit and Vegetable Growers of Canada and the Greenhouse Produce Alliance of Canada for five minutes.

Are you presenting together? Yes.

Mr. Janzen, are you going first?

Marcus Janzen President, Fruit and Vegetable Growers of Canada

If that's the chair's wish, that's what I will do.

Liberal

The Chair Liberal Michael Coteau

It's whatever you planned for.

President, Fruit and Vegetable Growers of Canada

Julie, would you like to go first?

Julie Paillat National Coordinator, Greenhouse Produce Alliance of Canada

You're such a gentleman. Thank you.

Mr. Chair and honourable members, thank you for the opportunity to speak today on behalf of the Greenhouse Produce Alliance of Canada. GPAC is the national voice of greenhouse fruit and vegetable growers and a trusted partner in advancing Canada's economic competitiveness, food security and climate leadership.

Canada's greenhouse fruit and vegetable growers generate approximately $6.3 billion annually for Canada's economy and employ an estimated 41,000 people across the value chain. Canadian agriculture is a proven economic driver, yet the greenhouse fruit and vegetable sector currently navigates a structural double squeeze that positions primary producers between high market concentrations on both the input and the retail sides of their operations.

Greenhouse growers rely on integrated North American markets to grow their businesses, adopt new technologies and expand production. In turn, Canadians benefit from a reliable supply of fresh, nutritious, high-quality, sustainably grown domestic produce throughout the year.

Greenhouse agriculture is being asked to invest and grow during a time of rising pressures from geopolitical tensions, global climate change, extreme weather events and escalating trade pressures. For our members, there is a need to act with some urgency to prioritize food security. Industry and government must work together on pragmatic regulatory and fiscal interventions.

We are seeking support for the strategic priorities outlined in the three pillars of our “Greenhouse Investment Roadmap”. These would fuel economic competitiveness and trade resilience, prioritize food security and business risk management, and power climate-smart agriculture and innovation.

Without the strategic alignment of policy measures, greenhouse investment is at risk of being displaced to other North American jurisdictions and being outpaced by U.S. incentives and programming, which provide a friendlier business climate for major capital investment. We are seeking targeted, modernized programs that are effective at delivering at the scale our sector needs.

The greenhouse fruit and vegetable sector stands ready to deliver food security, and we look forward to your questions.

Thank you.

Liberal

The Chair Liberal Michael Coteau

Mr. Janzen, go ahead.

President, Fruit and Vegetable Growers of Canada

Thanks, Julie.

Mr. Chair and honourable members, good morning. Thank you for the opportunity to appear on behalf of the Fruit and Vegetable Growers of Canada.

Our members grow more than 120 fruit and vegetable commodities across the country. These are everyday foods, but they are also strategic foods. Global instability, climate disruption, trade uncertainty, labour pressure and rising costs mean that Canadians cannot take domestic food production for granted.

This committee study focuses on creating value in the food chain, encouraging investment and innovation, reducing barriers to economic activity, strengthening local production and processing, and supporting local purchasing. These priorities align directly with the 2026 pre-budget recommendations we made to the House's finance committee.

First, we believe that Canada needs to apply a food lens in federal decision-making. Regulation, trade, labour, infrastructure and program funding all impact whether growers can keep producing in Canada. A food lens means assessing decisions for their impact on domestic production, farm viability, competitiveness and access to healthy food.

Second, growers need timely access to effective crop protection tools. This is not about weakening protection for human health or the environment; it is about science-based decisions that also reflect real farm conditions. Without these tools, Canada faces lower yields, higher costs, more food loss and a greater dependence on imports.

Third, Canada must modernize business risk management and invest directly in resilience before disasters occur. Current programs do not adequately reflect the realities of horticulture, perishability, regional differences or increasingly frequent extreme weather. Investments in water management, storage, processing, climate adaptation, applied research, and pest and disease preparedness would reduce risk and strengthen food security.

Fourth, local production depends on reliable and stable labour and rural infrastructure. Seasonal workers, housing, transportation and health services are food security infrastructure.

Finally, more broadly, Canada needs more domestic processing capacity, stronger safeguards against unfair or non-compliant imports, and stable trade rules. Perishable products cannot simply be stored until markets improve. Growers need predictable supply chains and practical tools when disruptions occur.

Canada's fruit and vegetable sector can deliver more local food, stronger supply chains and lower vulnerability to global shocks, but growers—

Liberal

The Chair Liberal Michael Coteau

Sir, I'll have to stop you there. We're about 20 seconds over, and I need to move on. I'm sorry for interrupting you.

President, Fruit and Vegetable Growers of Canada

Thank you.

Liberal

The Chair Liberal Michael Coteau

Thank you so much.

Next we have the Union des producteurs agricoles de Portneuf.

Mr. Hébert, you have five minutes.

Christian Hébert President, Union des producteurs agricoles de Portneuf

Mr. Chair and members of the committee, thank you for giving us the opportunity to present an initiative that, in our view, is a practical model for regional development, combatting food insecurity and supporting our local agriculture. I'm talking about the Portneuf food voucher program.

I'm here today on behalf of the board of directors of the Union des producteurs agricoles de Portneuf. The Portneuf UPA is a proud partner in this joint initiative, which brings together the agricultural sector, community members, municipal officials and institutions to achieve a common goal: ensuring that all citizens have access to fresh, local food while supporting our farmers.

This project is very important to the Portneuf UPA because it creates a direct link between families and the farmers who grow crops, raise livestock, process food and provide for our region. The food voucher program was launched in 2025 at public markets in Saint-Raymond, Deschambault-Grondines and Saint-Casimir.

In its very first year, the program provided 94 vulnerable households with access to healthy, high-quality food for 12 weeks. More importantly, this program is fundamentally changing the way we approach food assistance. Traditionally, support measures for people experiencing food insecurity have often relied on models that, while important, may create a stigma.

The food voucher program uses a different approach. Participants receive vouchers they can use at public markets, just like any other shopper. This allows them to choose their own food, meet producers, find local products and fully participate in community life. This is the program's greatest strength. It simultaneously addresses two major societal challenges.

First, it helps reduce food insecurity. The results speak for themselves. In 2025, the voucher redemption rate was 94%, a clear indication that there is a genuine need and that the participating families fully embraced the program. The program also generated more than $63,000 in economic benefits for participating public markets, including $12,670 from vouchers purchased by members of the public through La Ruche, which demonstrates citizens' support for this initiative and their commitment to ensuring access to food and supporting local businesses.

The data collected from participants is equally telling. More than 91% of respondents feel that the food vouchers made a significant contribution to their food budget during the summer. Nearly 71% of respondents said the vouchers helped them reduce their grocery expenses, and 56% of respondents said the vouchers were the main reason they were able to eat better. Judging from these figures, this isn't just a financial support program; it's a practical tool that improves families' quality of life and their access to healthy food.

Furthermore, the program directly supports the local organic food economy. Every voucher redeemed means additional sales for producers.

Finally, if I may, I'd like to share my dream for the food voucher program. My dream is that it will spread throughout Quebec and even serve as a model for the rest of Canada.

Thank you.

11:40 a.m.

Liberal

The Chair Liberal Michael Coteau

Thank you very much.

We will go to the Conservatives for the first round.

We'll bring it to five minutes each. We're probably going to hear the bells, and I'd like to see if we can get more than one round in, if that's okay with everyone.

Go ahead, Mr. Gourde, for five minutes.

11:40 a.m.

Conservative

Jacques Gourde Conservative Lévis—Lotbinière, QC

Thank you, Mr. Chair.

Congratulations on the food voucher program, Mr. Hébert. If you would like to tell us more about it, please send information or a brief to the committee. We will take it into consideration, and perhaps your dream will come true.

If you could secure funding to set up the necessary infrastructure and help bring your project to fruition, would that funding be welcome? The government has a lot of projects on the go right now. For example, there's the high-speed rail project, in which the government is prepared to invest $100 billion or $150 billion, even though we don't even know if it will actually help people. We do know that your project actually helps people. The problem right now is food affordability. Your project directly benefits those who need it most. How might we help you?

11:40 a.m.

President, Union des producteurs agricoles de Portneuf

That's basically the reason I'm here with you today.

In the past, the federal government has helped British Columbia. We didn't invent the food voucher program here. Through conversations with farmers' markets in Quebec and our partners, we learned what was being done in the Maritimes and in British Columbia. Investments have been made, and they're working. Our food voucher program generates $63,000 in economic benefits, but British Columbia has $8 million in food voucher transactions across various markets. In the Maritimes, it's $3 million.

Two or three years ago, the federal government tasked a food security think tank—the Centre for Social Innovation in Agriculture—with studying this issue and conducting a pilot project. The RCM of Portneuf and the Lower St. Lawrence region participated in the project. The budget was $300,000. We're not talking about hundreds of millions of dollars. We're not talking about billions of dollars. However, by investing a few hundred thousand dollars to support our groups, our stakeholders and the people who donate to the United Way and contribute to the Desjardins community development fund, we are actually creating something much bigger. Your support is extremely important.

Conservative

Jacques Gourde Conservative Lévis—Lotbinière, QC

Your nutritional coupon program is a win-win solution. You're helping people in need who are struggling to put food on the table, but you're also helping an entire network of farmers who want to sell their products at their farm stands.

It can be hard to get people to go to a farm stand. Their first stop is the supermarket; then they'll drive the extra distance. With nutritional coupons, though, a lot of people make the detour before going elsewhere. Have you measured the program's potential impact on local farms people see along the road?

President, Union des producteurs agricoles de Portneuf

There's been a big change in a year.

We don't have enough workers on our farms, but we have to send staff to farmers' markets on busy days, Fridays and Saturdays. Oftentimes, farmers alternate. What they've seen with the nutritional coupons is that they're able to make about $7,000 more a day. They're seeing people who don't normally go to farmers' markets.

As I said, with the major push to buy local, which has helped take away the stigma, and the food assistance program for families, people are going to farmers' markets. Their reservations are fading. People are realizing that buying their fruits and vegetables directly from producers, at the farmers' market, is cheaper than buying them at Maxi. Buying your meat or chicken directly from the farmer is a lot cheaper than buying it in bulk at Costco. There isn't a 30%, 40% or 50% markup.

Conservative

Jacques Gourde Conservative Lévis—Lotbinière, QC

I have one last question, Mr. Hébert.

What's the mood like right now in the Portneuf region, with the possibility of the high-speed train cutting through farmland there?

A quick answer would be appreciated.

President, Union des producteurs agricoles de Portneuf

Things are grim. More than 200 farmers are impacted. Using Financière agricole du Québec figures, we've estimated that 120 businesses in Portneuf, just within the regional county municipality, will be affected. When the agricultural economist comes back to calculate the farm's viability, the business won't make financial sense anymore. These farms won't be able to get their loan guarantees renewed with the Financière agricole du Québec. That will put 120 farms out of business, farms that keep our farmers' markets going. It's rare for everyone to be on the same side of an issue, but in this case, everyone is. As for the nutritional coupons, the community groups we've spoken with—

Liberal

The Chair Liberal Michael Coteau

Thank you. I'm sorry.

We'll go to MP Dandurand for five minutes.

Liberal

Marianne Dandurand Liberal Compton—Stanstead, QC

Thank you, Mr. Chair.

Thank you to the witnesses for being here today.

I think we all agree that food security is a priority. Even though our country is a major producer of agri-foods, the rising cost of living has made it hard for people to put food on the table sometimes.

I actually met with Canadian produce growers this morning. It was really interesting. It was a great meeting. This was one of the issues we talked about. One of the challenges that came up was our heavy reliance on agri-food imports, especially in the vegetable industry.

Ms. Paillat, you were at the meeting.

Mr. Bourgoin, is there anything you'd like to say about that? Do you agree that we are too reliant on imports in the vegetable industry? How can we fix that?

Executive Director, Association des producteurs maraîchers du Québec

I agree with you: We are too dependent on imported products. During the winter, there are valid reasons for this. However, when it's summer and we see a lot of imported products on store shelves across the country, it's cause for concern.

With the integration and centralization of their supply chains, large retail chains can increasingly easily import products that are grown elsewhere at lower cost, because the environmental, social and governance standards in those regions are not the same as here. This has the effect of stifling local producers.

We often focus on the effects of market concentration on consumers, but pay little attention to its effects on suppliers.

Liberal

The Chair Liberal Michael Coteau

We'll have to stop for a second. The bells are ringing. I'm sorry to interrupt you.

I have to ask for unanimous consent to continue. Are folks planning to stay here to vote? Is everyone fine with that?

Some hon. members

Agreed.

Liberal

The Chair Liberal Michael Coteau

Please continue. Thank you.

Executive Director, Association des producteurs maraîchers du Québec

We began addressing the issue of the concentration of the major food chains with the voluntary code of conduct. Now, we have 12 months left to demonstrate that retailers are truly committed to changing their behaviour—which is by no means a foregone conclusion.

Furthermore, I would humbly suggest that members of Parliament look into the effects of supply chain integration. I am sure this would be an interesting area for the Commissioner of Competition to explore.

Liberal

Marianne Dandurand Liberal Compton—Stanstead, QC

Ms. Paillat, did you have something to add?

National Coordinator, Greenhouse Produce Alliance of Canada

Julie Paillat

Thank you.

I agree with Mr. Léger Bourgoin's comments.

I think there is an ask, a need, for the legislation to go further. There should be some further binding terms and an interest in really making change.

I'll leave it at that for now. I know you have other witnesses who are experts in this regard.

Liberal

Marianne Dandurand Liberal Compton—Stanstead, QC

Thank you.

Mr. Léger Bourgoin, you mentioned the Competition Bureau, which was here last week and was asked to send us recommendations aimed at giving it more influence in the supply chain, particularly with regard to regulations, among other things. We hope then there will be solutions in this regard.

You talked a lot about grocery stores. Do you think it would be possible to attract new grocery chains to Canada?

Executive Director, Association des producteurs maraîchers du Québec

Honestly, I don't think so.

In fact, there has been a trend toward consolidation that we decided to let play out, and to think that a new network—whether American or European—could integrate into the Canadian landscape from coast to coast, given the costs involved, is just wishful thinking.

That is why, in my humble opinion, we must prioritize short supply chains to attract more competition to the Canadian food sector. Short supply chains already exist in every Canadian province, but the economic pressure this model faces from the integration model of large chains is highly detrimental to it. We must therefore support short supply chains.

In fact, the best way to address food insecurity caused by global geopolitical disruptions is to ensure that our own agri-food system is robust enough to meet domestic demand. The more diversified our supply sources are, the more farms will be able to survive in the long term.

Liberal

The Chair Liberal Michael Coteau

Thank you very much. I even gave you the extra 20 seconds when we had to stop for unanimous consent to continue.

We'll go to the Bloc for five minutes, please.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

Thank you, Mr. Chair.

Mr. Léger Bourgoin, we are familiar with your “CBC” style, which you used to deliver your opening statement as if it were a fairly objective news broadcast.

You spoke about labelling and origin. To me, as my colleague Mr. Gourde would say, this is outrageous. I'd like to know your true thoughts on this matter.

Executive Director, Association des producteurs maraîchers du Québec

What do you mean by labelling?

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

Last fall, you took steps to find out whether the product labels in the store indicated the actual origins of the food. There's a game being played when it comes to the actual origin, and it's often to the detriment of Quebec producers and small markets.

Executive Director, Association des producteurs maraîchers du Québec

Yes, it's problematic.

When we did our analysis, we found that for every in-store visit, there was an average of seven labelling errors regarding the products' origins. Obviously, those labelling errors affected Quebec products more than products from elsewhere in the world.

One might think that consumers will realize that it's very difficult to have a papaya from Quebec. However, when a store mixes cauliflowers from the United States, Mexico and Quebec and displays a big fleur-de-lys to say that it's very happy to support local producers, that's unacceptable.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

That's because people do want to buy local.

You touched on another aspect that's important to us, as you know. I want to talk about the legacy of the Achille de la Chevrotière food wholesaler, which was bought out by Sobeys in 2006. Before that takeover, we had an independent distributor that had $270 million in sales and supplied 25 independent markets. That obviously helped producers get into grocery stores in Ontario, Abitibi-Témiscamingue and the north, as well as in Saguenay—Lac‑Saint‑Jean. The distribution centre was in Rouyn-Noranda.

Unfortunately, because of the Sobeys takeover, the operations were scaled back. The image that followed, which for us is farcical, is the Guyenne tomatoes. They now leave Guyenne, a village in Abitibi West, go for about an eight-hour drive to reach the warehouses in Montreal, stay there for a few days then return to our grocery stores, with the impact that this can have on freshness.

How can we recreate the models that ensure that our regions are not penalized and have access to truly local products, made by our local producers, in our grocery stores?

Executive Director, Association des producteurs maraîchers du Québec

I have two parallel answers for you. The first is that it's really important to support short supply chains. The other one is more delicate.

As you know, the centralization and integration of supply chains mean that there are fewer and fewer affiliated stores. In the past, affiliated stores in Quebec could support local suppliers. However, that opportunity is becoming less and less available, because the affiliated stores are essentially being asked to buy their products through the central purchasing body.

We talk about a back door, that is, the possibility for local producers to go deliver the products they have made or harvested in recent hours directly to the retailer. Why is this model less and less accepted by grocery chains? It's basically to create a very clear dependence on a limited number of suppliers.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

In more concrete terms, what are the risks of having companies that control the distribution chain all the way down to the store? We're seeing more and more of wholesalers, too. What are the risks to producers?

Executive Director, Association des producteurs maraîchers du Québec

It's quite simply asphyxiation. A producer who doesn't have access to a distribution channel is doomed.

Say that a producer doesn't have access to the long supply chain—which means the retailer—because it's smaller and lacks the logistical capacity to meet the expectations and criteria of the major chains. If the short supply chain ceases to exist, the leitmotif, the reason to live, the vocation of the producer falls apart.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

In closing, can you draw a parallel with what's happening in Ontario regarding independent retailers or affiliated stores?

Executive Director, Association des producteurs maraîchers du Québec

Ontario still has independent stores, small regional chains. That no longer exists in Quebec. The trend toward consolidating around large retailers is stronger in Quebec than elsewhere in Canada.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

Thank you, Mr. Léger Bourgoin.

Thank you, Mr. Chair.

Liberal

The Chair Liberal Michael Coteau

Thank you very much.

I want to give the committee a bit of an update. We will go to about 12:15, and then we'll suspend. We will do the votes and come back around 12:35. That's if everyone agrees, of course.

Then we'll go into the second round and probably stay an extra 10 to 15 minutes, if that's okay with people. We'll postpone the drafting instructions. We can do that next week. We won't have enough time today, and I've heard from the clerk that it will still be fine for the analysts.

We'll go to the next round. It will be five minutes, five minutes and two and a half minutes.

Go ahead, sir.

Conservative

David Bexte Conservative Bow River, AB

Thank you, Chair.

Thank you, witnesses, for being here today.

Thank you, colleagues, for being present and sharing your wisdom.

We've heard a lot, not only today but in other testimony, about the need for more tools; the cost of inputs; the requirement for applied research; access to new pesticides and products; the impact of taxes, regulations and the carbon tax; and the delay imposed by regulations on approvals. All of these things result in an increased cost to producers, and I don't think it's necessarily obvious to consumers how that self-imposed cost is then translated to consumers.

I recently introduced a private member's bill, Bill C-273, the FARM act, to develop a trusted jurisdiction regime whereby we can apply provisional approval or acceptance for new products, like feed, seeds, fertilizers and pesticides—and veterinary products as well, through a bit of a different track—to drive at reducing the regulatory timeline and the burden in accessing new products in order to make our businesses and industries more efficient in the agricultural space. That directly translates into improved variety, resilience and cost to consumers.

I wonder if you could comment, Mr. Janzen, on how that might impact fruit and vegetable growers.

President, Fruit and Vegetable Growers of Canada

I would agree, especially on the processing side, particularly when I think about the fertilizer complex and how obvious it's become that we are dependent on the Middle East in particular.

It's my view that even if the conflict ended tomorrow, the world is not going back to the same place that it was before. Especially when it comes to crop protection tools, I think an alignment with jurisdictions that have an objective similar to ours.... I would think of a country like Australia, for example.

For a lot of commodities, the single biggest impediment to growth is that growers are becoming increasingly unsure that they can actually protect their crop, so I take your point.

Conservative

David Bexte Conservative Bow River, AB

I appreciate that. It causes me anxiety on my farm at home. Am I going to be able to access the products I need in order to compete with other jurisdictions in producing products and to generate a healthy net profit per acre to maintain the viability of the farm—or the greenhouse, or the market garden, or any of it? The self-imposed 35% tariff on fertilizers is dramatic. We need to help the public realize that many of the burdens and barriers we have are self-imposed.

Ms. Paillat, could you please comment on this relationship and the circumstance we're in?

National Coordinator, Greenhouse Produce Alliance of Canada

Julie Paillat

I am not an expert on fertilizer tariffs per se. However, we have seen this as well in the greenhouse sector in the past when there's been a tariff on tomatoes that didn't really allow us to work together with our North American.... It provided a response to the U.S. tariffs for sure, but our supply chains across North America do best when they are harmonized and able to trade freely, which is similar to the crop input as well.

At this point, we also see some misalignment in the impacts that steel tariffs are having on our greenhouse building structures and on infrastructure investment. We would like to see an alignment for growth in the sector and an increased understanding of what that system requires to be competitive.

Conservative

David Bexte Conservative Bow River, AB

It's important that we remove the self-imposed barriers, so I appreciate your comments on that, especially related to crop protection products and innovative products that aren't available in Canada because the regulatory regime is too high.

Mr. Léger Bourgoin, did you want to comment on that?

Liberal

The Chair Liberal Michael Coteau

Your time is up. Thank you very much.

Mr. Connors, you have five minutes.

Liberal

Paul Connors Liberal Avalon, NL

Thank you.

Thank you to the witnesses for coming out.

We're studying food security and being able to feed ourselves domestically in the face of global instability. We hear people say that people want to buy local. I'm not sure that people wanting to buy local always translates at the cash register. I don't know if you see that in your industry.

What unique challenges do your organizations or producers face in supplying domestic food to address food security in our country?

I'll start with Mr. Janzen.

President, Fruit and Vegetable Growers of Canada

It's important not to lose sight of the fact that Canada is a northern climate, and for us to supply fresh fruits and vegetables 12 months of the year, there has to be a trading relationship, particularly with the U.S., as well as with Mexico. The ability of Canadian producers to export products that we can grow competitively needs to be there in order for us to have the monetary capability to purchase fresh fruits and vegetables in the winter from warmer-climate jurisdictions.

It is exceedingly difficult for Canadian producers to supply a reasonably broad spectrum of fruit and vegetables year-round. There are some exceptions. Take cucumbers. The technology is there to grow them under lights now, so Canada can produce cucumbers for 12 months of the year, but that product is the exception, not the rule.

Liberal

Paul Connors Liberal Avalon, NL

I'll go to Mr. Bourgoin.

Executive Director, Association des producteurs maraîchers du Québec

For example, Quebec is getting closer to food self-sufficiency when it comes to carrots. We have enough carrots to cover the whole winter up to the end of March or the beginning of April. The big question is this: In that context, how is it that we have carrots from China in the middle of winter? It's simply because those carrots are sold at the same price as local carrots, but the retailer's profit margin is quite a bit higher. At that point, the carrots stay in the vegetable growers' huge fridges.

We also have frozen products and canned products. Vegetable growers have this economic supply chain, but still, the major chains are increasingly preferring products from other countries, such as China, Egypt and Thailand, for reasons of their own. When we don't support the development of local producers and we focus on products from abroad, we jeopardize our local supply chain.

Liberal

Paul Connors Liberal Avalon, NL

For clarification, when you say you have enough carrots to supply, is that just for Quebec or for all of Canada?

Executive Director, Association des producteurs maraîchers du Québec

It's for Quebec, essentially.

As you know, the model we have in Canada is for provinces to talk to each other. When stocks are running low, we can know what's going on and manage the Canadian supply based on the available volumes. Ontario will also produce a great deal of carrots. It's one of the major producers in North America, as are we. Unfortunately, I don't know Ontario's level of food self-sufficiency in terms of carrots specifically.

As for the Quebec market, in recent years, the volume of carrots produced by farmers has enabled us to get to the end of March or the beginning of April before contacting Agriculture and Agri-Food Canada to tell them that stocks have been depleted.

Liberal

Paul Connors Liberal Avalon, NL

Ms. Paillat, do you have anything to add in 25 seconds?

National Coordinator, Greenhouse Produce Alliance of Canada

Julie Paillat

Sometimes it's not just a supply issue. There are issues and concerns about business interruption or instability, and we've seen that playing a huge role.

To Marcus's point about year-round supply, I think there's a lot of push to say that we can do that in a greenhouse, but production in a greenhouse requires a lot of parts and pieces. Just as it takes a village to raise a child, it takes a lot of parts and pieces relating to energy, etc.

Liberal

The Chair Liberal Michael Coteau

Thank you.

Next we'll go to the Bloc.

Sébastien, I'll give you three minutes, just because I gave a bit of extra time there.

12:10 p.m.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

Thank you, Mr. Chair.

Mr. Hébert, I have followed your Facebook page with great interest over the years, and I'm following it particularly closely these days to keep up to date on the challenges related to the Alto project.

First, when you appeared on Le Téléjournal, you gave a very firm position.

Last week, we heard from Ms. Bercier, who gave quite an eloquent testimony.

Can you explain to us why the Alto project is not a good solution or a good priority, or why it isn't as good as it looks in the current context? Can you also tell us about the impact of this project on your mental health and that of your colleagues?

12:10 p.m.

President, Union des producteurs agricoles de Portneuf

When it comes to food security, the world is changing a lot, and that is changing the way we produce.

This week, we're very happy, because it's the launch of strawberry season in Quebec. We're the third-largest producer of strawberries in the world, number one being Mexico and number two being California.

Normally, this week, we would have experienced the dumping of products from Mexico and California. I have worked in production for 15 years, and we have been through this before, but things are terrible right now. Mexico is currently going through a tough time. In California, farms are having to stop production because of drought and disease. Their prices are exorbitant. These days, when they manage to get products, they start by feeding themselves. That's what's happening here.

I said that the world is changing, that prices are changing and that it's necessary to change the stereotypes.

In Portneuf, we have the largest strawberry producer in Quebec: Fraisière Faucher. We also have small producers, such as Sandra Paradis, from L'Arc‑en‑ciel du Paradis. These are businesses that are going to disappear.

If the buildings are separated from the pick-your-own fields, that will be the end of the business. For the larger producers, transportation is going to be the issue. Our companies are already mature. Those that had already bought fields here and there are at maximum capacity. If detours get added in, there won't be any profitability left. We're already in an economic crisis. Mental health doesn't depend on a single factor; it depends on a combination of many things.

Right now, we're on a tightrope. In the first three months of 2025, the number of farm businesses that were going under in my sector was equivalent to the average over the past 10 years. When it comes to the additional weight that will be added with the high-speed rail project, people are going completely insane. We will lose the profitability of the businesses that our people have built. It's a social crisis.

What I said earlier to Mr. Gourdes, whom I thank very much for asking his question, is something MPs in the region are experiencing. Canadians are visiting them. The community groups around us are also worried. It's really an entire economy that's being affected. This is a serious crisis.

I know that we won't convince city people by tugging at their heartstrings; we'll do so by making the case for food security, for their pantries. In terms of project costs and profitability, we have said that more than 2,500 farms are going to be affected. I just want to mention that the sales from our producers across 2,500 farms are equivalent to Hydro‑Québec's net profits. That's how people will begin to understand what we will lose in Quebec.

12:10 p.m.

Liberal

The Chair Liberal Michael Coteau

Thank you very much.

We have about five minutes before the vote starts. For those five minutes, folks can get ready to vote. There will probably be about another 15 minutes after, so in about 20 minutes from now, we'll come back.

I'll suspend and see you in 20 minutes.

Liberal

The Chair Liberal Michael Coteau

I'd like to bring the meeting back to order.

Pursuant to Standing Order 108(2) and the motion adopted by the committee on Thursday, September 18, 2025, the committee is resuming its study on food security in the face of global instability.

I'd like to welcome the witnesses joining us today. From the Canadian Agri-Food Policy Institute, we have Tyler McCann. From Food, Health and Consumer Products of Canada, we have Michael Graydon. From the Office of the Grocery Sector Code of Conduct, we have Karen Proud.

I didn't mention that MP Rana is joining us today, filling in for Mr. MacDonald. Welcome to the committee. We appreciate your being here.

Some hon. members

Hear, hear!

Liberal

The Chair Liberal Michael Coteau

That's the first time anyone has clapped, so you're in good standing at this committee.

We'll go to Mr. Graydon for five minutes.

Michael Graydon Chief Executive Officer, Food, Health and Consumer Products of Canada

Thank you very much, Mr. Chair.

Thank you for the opportunity to represent the Food, Health and Consumer Products of Canada food manufacturers today.

Food security is not only about what Canada grows; it's about whether we can process, package, move and supply the food Canadians rely on every day. Just as Canada views energy, transportation and telecommunications as strategic infrastructure, we should view food manufacturing capacity as central national infrastructure that underpins food security, economic resilience and affordability. At a time of affordability pressures, tariff uncertainty and global supply chain disruptions, strengthening domestic food manufacturing is essential to jobs, investment, innovation, resilience and food sovereignty.

Food security is also a productivity issue. Canada's challenge is not weak firms or complacent workers. It's an investment and scale problem. Business investment per worker remains significantly below that of the United States, reflecting higher operating costs, regulatory complexity and investment uncertainty.

When multinational companies decide where to place the next production line, automation project or processing facility, Canada is competing for capital. If Canada is slower, more expensive, less predictable or less aligned with major trading partners, that investment will go elsewhere.

At the same time, many Canadian small and mid-sized manufacturers face enterprise-level regulatory obligations, and access to capital is increasingly challenging. This “missing middle” limits their ability to scale, compete and supply Canadians with affordable products year-round.

We're already starting to see the consequences. More than half of many centre-store grocery products are now imported, primarily from the United States. The manufacturing capability still exists in Canada, but the investment environment does not consistently encourage expansion.

Without change, Canada risks becoming more of a distribution market than a manufacturing economy, leaving Canadians increasingly dependent on foreign production for everyday food products. If we want a more resilient food system, greater affordability and stronger domestic production, there are three actions Ottawa can take.

First, put capital behind domestic manufacturing capacity. Canada needs a domestic food processing fund that supports modernization, automation, facility expansion and equipment upgrades across the manufacturing sector. Funding should support the full manufacturing ecosystem. Large manufacturers anchor regional supply chains, while mid-sized manufacturers are often the most structurally constrained. Both are essential to Canada's food security and economic growth. Strategic investment in processing capacity would strengthen Canada's ability to produce more food at home, improve productivity, create jobs and help stabilize food costs for Canadian consumers.

Second, modernize regulation without compromising safety. Canada's food safety system is a competitive advantage and a source of public trust. No one is asking the government to lower our standards. However, regulatory systems must be faster, more predictable, better aligned with trusted trading partners and more attentive to cumulative costs. Food security and affordability depend not only on safe food but also on a regulatory system that enables innovation, investment and timely access to products and technology. Expanding the Canadian Food Inspection Agency's mandate to consider economic competitiveness and food security alongside safety is a step in the right direction.

Third, strengthen the supply chains and workforce that food security depends on. That means investing in transportation infrastructure, improving trade corridor efficiency and reducing bottlenecks that increase costs and delay the movement of food across our country. It also means maintaining access to skilled workers through agricultural labour programs and creating stronger pathways to permanent residency for experienced workers in year-round agri-food occupations.

Local purchasing initiatives only succeed when there is sufficient local capacity to support affordable products. The best way to support local purchasing is to help Canadian manufacturers invest in their workers, expand production and move their goods efficiently to market.

Canada does not need to choose between global trade and local resilience. We need both: integrated North American supply chains and a stronger domestic manufacturing base that captures more value here at home. Food security will be achieved through investment, productivity, modern regulation, efficient supply chains, skilled workers and a whole-of-government commitment to strengthening Canada's agri-food economy.

The investment decisions that will shape Canada's food system for the next decade are being made right now. Too often, Canada is not winning in those decisions. At FHCP, our members want to build here, hire here and innovate here. They want to supply Canadians from Canadian facilities, but investment follows certainty. If Canada wants stronger food security, greater affordability and a more resilient economy, we must make this country one of the best places in the world to manufacture food.

Thank you, and I look forward to your questions.

12:40 p.m.

Liberal

The Chair Liberal Michael Coteau

Thank you very much.

Next we'll go to Ms. Proud.

Welcome back to the committee. You have five minutes.

12:40 p.m.

Karen Proud President and Adjudicator, Office of the Grocery Sector Code of Conduct

Thank you, Mr. Chair and members of the committee, for the invitation to appear before you today. I also want to thank the committee for your continued interest in the work of the Office of the Grocery Sector Code of Conduct.

I had the opportunity to appear before this committee on two occasions last year during your study on the implementation of the code. I appreciate the opportunity to return and provide a bit of an update on the progress we have made since then.

The Canada grocery code is a voluntary industry-led initiative meant to provide shared principles and trade standards for stakeholders across the supply chain. The Office of the Grocery Sector Code of Conduct is the independent organization responsible for supporting the implementation of the grocery code, monitoring compliance with the code, providing education and guidance to industry participants and administering both a confidential issue-reporting process and a formal dispute resolution management process.

Since becoming operational, my office has worked closely with retailers, suppliers and industry associations across the country to support the implementation of the code and to promote greater consistency in commercial practices throughout the grocery supply chain.

The committee's current study is focused on food security in the face of global instability. While the grocery code is not a food security policy instrument, there are important connections between the objectives of the code and several of the issues being examined by the committee.

The code does not increase agricultural production, create processing capacity, establish trade policy or address infrastructure and labour challenges, nor does it regulate food prices or profit margins or require businesses to purchase Canadian products. Rather, the code is a framework intended to improve the way businesses work together by promoting fair dealing, transparency, predictability and accountability in commercial relationships within the grocery sector. These objectives may seem modest, but they are important foundations for a more resilient and more competitive food supply chain.

Investment and innovation are more likely to occur when businesses operate within a predictable commercial environment. Whether a company is considering investing in new equipment, expanding production capacity, introducing new products or entering new markets, confidence in commercial relationships is an important factor in those decisions. The code supports that confidence by establishing common expectations around issues such as written agreements, reasonable notice of changes, dispute resolution and the management of commercial disagreements.

Similarly, resilient supply chains depend on effective mechanisms for resolving issues when they arrive. Periods of disruption can place significant pressure on commercial relationships. Having clear expectations and established processes to address concerns can help businesses focus on solving problems rather than escalating disputes.

The code is also intended to support participation by businesses of all sizes. Through the code's dispute resolution and issue-reporting mechanisms, businesses have access to processes that can help address concerns and identify systemic issues affecting the sector. This contributes to a more transparent and predictable operating environment across the supply chain.

Over the past year, the office has continued to build these foundations. Membership in the office has grown to more than 200 organizations, representing retailers and suppliers from across Canada. We have established both confidential and formal mechanisms for raising concerns, and we have undertaken information-gathering exercises to better understand emerging challenges. We've issued guidance on two specific issues and created new opportunities for stakeholders to provide input into the ongoing evolution of the code.

Perhaps most importantly, we are beginning to see businesses engage proactively with the office to seek clarification, information and guidance. We are also seeing the code being used as a framework for commercial discussions and negotiations between members that have signed up to the code. These are encouraging signs that the code is helping to foster a culture of greater communication, transparency and problem-solving across the sector.

While it is still early in the implementation of the code, the experience to date suggests that clear standards, transparent processes and constructive dispute resolution can contribute to stronger commercial relationships and more resiliency in the grocery supply chain. Although the code is only one piece of a much broader food security landscape, its role is to help ensure that the businesses responsible for producing, processing, distributing and selling food in Canada are operating within a framework that supports predictability, trust and collaboration.

I look forward to discussing the committee's study further and answering any questions you might have.

Thank you.

Liberal

The Chair Liberal Michael Coteau

Thank you very much.

Next we'll go to Mr. McCann.

It looks like you're at an airport, so thank you for joining us today.

Tyler McCann Managing Director, Canadian Agri-Food Policy Institute

I am. Your bells have impacted my ability to get to my two o'clock flight on time, but thank you for the invitation to be here today.

In Canada and around the world, the agriculture sector and the food system are under increasing pressure. That means it is important to reflect and act to protect Canadian farmers and consumers from the negative effects of this global policy.

It's important to start by acknowledging some important distinctions. Canada is—

Liberal

The Chair Liberal Michael Coteau

I'm sorry, but I have to interrupt you. I've just been told that the interpretation is not working. We'll try testing it.

Your connection, sir, is not coming through properly. Can you try again?

Managing Director, Canadian Agri-Food Policy Institute

Is this better now? Do I have the right settings for interpretation?

Liberal

The Chair Liberal Michael Coteau

It might be a bad connection. That's two bad connections in one day. The connection is cutting in and out.

You can continue. If they can't do it, we'll have to stop.

Please go ahead, sir.

Managing Director, Canadian Agri-Food Policy Institute

I understand.

I will go to my five recommendations.

First, as your recent BRM study has shown, Canada needs to evolve its approach to risk management. Policies and programs need to be reformed so that farms have more choice and have effective risk management tools.

Second, Canada needs to double down on agriculture innovation. Federal, provincial and territorial governments should commit to an agri-food innovation strategy at their meeting this summer.

Third, Canada needs to commit to a critical input strategy. While we think of Canada as fertilizer-secure, eastern Canada is a major importer, and we rely on imports of important inputs, like seed and chemistry. A starting point is to remove fertilizer tariffs, but Canada needs a more focused effort to increase production and to secure the supply of critical inputs.

Fourth, more needs to be done to support transportation infrastructure. The recent budget investments are an important step forward, but governments should be looking at the unique needs of the food supply chain, including cold storage to support food supply chain resilience.

Finally, governments should look at how they can leverage the procurement tools they have in order to support Canadian production. The national school food program would be a good place to start to ensure that Canadian governments are supporting Canadian food.

I will submit my full remarks, but I hope to have the opportunity to take questions.

Liberal

The Chair Liberal Michael Coteau

Thank you very much. We appreciate your time.

We'll go to the Conservatives for six minutes.

Mr. Bonk, go ahead.

Conservative

Steven Bonk Conservative Souris—Moose Mountain, SK

Thank you.

Mr. Carney warned that “A country that cannot feed itself, fuel itself, or defend itself has few options” and said that Canadians can judge him by the price of food at the grocery store. I think he regrets saying those things, because at the moment, under his leadership, Canada is the only G20 country in a recession, and we lead the G7 in food inflation. For over a decade, these regressive Liberal policies and inflationary spending have driven investments, particularly in agriculture, out of Canada.

I'd like to start with Mr. McCann.

We talk about food resilience and food security in Canada. One of the main things we can do to increase production in Canada is have access to fertilizer and chemical products. Fertilizer prices have increased by 40% to 50%. I know they have on my farm. That's year over year. That's just taking the last year alone. Then we have the carbon tax and clean fuel standards.

Can you comment on how this is making Canada very uncompetitive in a globally priced market?

Managing Director, Canadian Agri-Food Policy Institute

I think we take our inputs for granted in Canada. We need to be more serious about this. The national food security strategy, which is supposed to come soon, should commit clearly to a critical inputs strategy that looks at ensuring the supply is there and looks at regulatory changes to make it easy to produce more and at permitting changes to make it easier to produce more.

For too long, it has been easy to ensure that farmers have fertilizer, pesticides and other important products. We need to realize that the world has changed, and we need to take this far more seriously than we have in the past.

Conservative

Steven Bonk Conservative Souris—Moose Mountain, SK

I'm in southeast Saskatchewan. We're right on the border with Montana and North Dakota. Let's take a crop like canola, for example. They can produce that crop 15% to 35% cheaper—according to estimates I've seen—than we can in Canada, just because of regulation.

Do you have any advice to give this committee on how we can make the Canadian agriculture sector more competitive?

Managing Director, Canadian Agri-Food Policy Institute

Regulatory change comes up over and over again. This is something that this committee should not stop talking about. It should not stop holding the government to account. Officials in this government need to act. They need to make changes.

This is a man-made challenge we have in Canada. We can talk a lot about the impacts of climate change and volatility, but the impacts of the regulatory environment are imposed by government officials in Ottawa and in provincial capitals across the country. This is something we need to do more on to deliver more serious change.

Conservative

Steven Bonk Conservative Souris—Moose Mountain, SK

In your opening remarks, you mentioned that one of your four pillars was innovation. Recently, we had an announcement from the Liberal government that they're going to close seven agriculture research centres across Canada that have been world-leading in some of the innovations they've brought forward, such as zero till, for example. Also, I believe that up to 60% or 80% of the seed varieties we use in western Canada are developed at these research centres, yet the centres are being closed.

Can you comment on that? You mentioned innovation. Do you think the closing of these stations will have a negative or positive impact on Canadian agriculture?

Managing Director, Canadian Agri-Food Policy Institute

Certainly, cuts in innovation spending have an impact.

One of the problems is that we've seen cuts over the last decades, and when spending on agriculture innovation goes down, we only feel the impact many years later. The closure of research sites makes this very up front. We will see the impact of that very clearly and presently, and the impacts of long-term cuts will have long-term negative consequences.

We need to double down on innovation. Again, something we have taken for granted is that farmers will always have access to new varieties, and we'll always have new technology available. Over the last 10 or 20 years, we have not had the track record we had 20 or 40 years ago in giving farmers the tools they need. We need to do this more seriously. I would like to see the federal government and the provincial governments commit to a more meaningful and substantial ag innovation strategy when Minister MacDonald meets with his counterparts this summer.

Conservative

Steven Bonk Conservative Souris—Moose Mountain, SK

When it comes to business risk management tools, what are you envisioning in your four pillars that you mentioned? BRM was on top.

Managing Director, Canadian Agri-Food Policy Institute

That's right.

Conservative

Steven Bonk Conservative Souris—Moose Mountain, SK

Go ahead.

Managing Director, Canadian Agri-Food Policy Institute

We need to give farmers more choice and more tools. Effectively, we try to treat all farmers the same today. We like to think that one set of programs can give farmers all the tools they need, but we know that farms today are very different.

It's not about just one region or the other or one commodity or the other. Farms are in different business cycles, and they need different tools. We need to recognize that and find more ways to give farmers more innovative risk management tools that are better suited and more effective against the risks in this new and volatile world we're in.

We can't just say, “AgriStability and crop insurance are your two options.” We need to look at a different world. It doesn't mean that we take those tools away. If a farmer still wants to use crop insurance or a farmer wants to use AgriStability, we should probably let them, but we need to create a space where we're giving them better and more innovative tools to use instead.

Conservative

Steven Bonk Conservative Souris—Moose Mountain, SK

From your vantage point, from the institute you represent, what would be your take on Alto and the confiscation of valuable farmland in Ontario and Quebec?

Liberal

The Chair Liberal Michael Coteau

You have 20 seconds left.

Managing Director, Canadian Agri-Food Policy Institute

It's unfortunate.

Canadians live in some of the best, most fertile farmland in this country. We've seen provincial governments go out of their way to take farmland out of production. There was opposition to that. There needs to be opposition to federal efforts to take farmland out of production too.

Conservative

Steven Bonk Conservative Souris—Moose Mountain, SK

Hear, hear.

Liberal

The Chair Liberal Michael Coteau

Thank you very much.

Next we'll go to the Liberals for six minutes, with MP Chatel.

Liberal

Sophie Chatel Liberal Pontiac—Kitigan Zibi, QC

Thank you very much, Mr. Chair.

I would like to welcome all the witnesses who are here today.

Mr. McCann, I'd like to first thank you for coming to Shawville, in my riding, to meet with producers, farmers and processors, as well as a number of people interested in the issue of food security, which was one of our themes.

What exactly have you heard from people on the ground when it comes to the issue of food security?

Managing Director, Canadian Agri-Food Policy Institute

What I have heard is that they're facing a challenge.

On the one hand, producers want to produce more food. They want to be a part of the local economy and help ensure local food security. On the other hand, they're facing a challenge. They want to make sure they can get their food directly to consumers or markets, but the supply chains and local infrastructure are a problem for them. There needs to be an action plan on that.

What is too often missing in Canada is a plan that focuses on local markets, local value chains. Action is too often taken at the national level. Agriculture is effectively a two-tiered system in Canada: one tier is focused on domestic and international markets, and the other is focused on local markets. We should be doing more to support the local value chain to ensure that producers, such as those in Pontiac, can play a greater role in food security.

Liberal

Sophie Chatel Liberal Pontiac—Kitigan Zibi, QC

Thank you very much.

Mr. Graydon, you were talking earlier about productivity as an important factor in Canadian food security. We need to do more here in Canada to become not a distribution market but a processing market.

We have long defined the agri-food sector as a sector with high potential for growth. For example, we implemented a superdeduction to increase investments in technology and machinery. We also have the regional tariff response initiative, which enables investments in the agri-food sector and in greenhouses as well.

If you had one piece of advice for the government regarding this economic potential in food processing, what would it be?

Chief Executive Officer, Food, Health and Consumer Products of Canada

The advice would be to continue the investments that have been made that stimulate capital investment. A lot of it is foreign capital investment. Multinationals that have access to capital have made some very significant contributions to the expansion of capacity here. In the last nine months, we're probably looking at in the neighbourhood of $2 billion in capital investment in major plants across the country. Some of the initiatives that you outlined have stimulated some of that confidence in the Canadian market. We need more of it. We also need mechanisms to stimulate capital investment in the small and medium-sized enterprises, which really do struggle to find access to capital.

Liberal

Sophie Chatel Liberal Pontiac—Kitigan Zibi, QC

Would you say that the FCC investment, the $7-billion fund, a large part of it being dedicated to investment in the agri-food sector, can be a way to access capital? If not, what else should the government do?

Chief Executive Officer, Food, Health and Consumer Products of Canada

The program FCC has put together has certainly contributed. There's $7 billion or $8 billion accessible to the marketplace. The importance is in finding the ease to access and making sure that it's not so complex. Many of these small and medium-sized enterprises do not have the infrastructure to figure a lot of this stuff out, so you have to make it easier for them. If there's less complexity, I think accessibility to that money will get translated into investments.

While the agricultural community talks a lot about agri-food, this needs to become part of the dialogue across government in all aspects of it. We are, and have the potential to be, a powerhouse, but it has to be an all-of-government discussion. It cannot just be an agricultural discussion.

Liberal

Sophie Chatel Liberal Pontiac—Kitigan Zibi, QC

Thank you very much.

Ms. Proud, when it comes to one aspect of food security, we're obviously looking at the entire supply chain, including grocers. In Canada, the market has five major chains. In your experience—I'm talking not only about your experience enforcing the code of conduct, but also your experience working with stakeholders—do you think it would be worth exploring more competition?

As Mr. McCann just said, we just came back from a round table, and we're talking a lot about a local grocery ecosystem or places where producers can be connected with consumers.

Do you think that would be a good initiative?

Liberal

The Chair Liberal Michael Coteau

I'm sorry. There's no more time. There are six seconds left.

Liberal

Sophie Chatel Liberal Pontiac—Kitigan Zibi, QC

Ms. Proud, you can send us the information in writing.

Liberal

The Chair Liberal Michael Coteau

We'll go to the Bloc for six minutes.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

Thank you, Mr. Chair.

Ms. Proud, your code of conduct is in effect: What impact is it currently having on relations between retailers and producers?

President and Adjudicator, Office of the Grocery Sector Code of Conduct

The code of conduct launched on January 1 with full implementation. The impact on retailers, suppliers and producers is really for those that have joined the code. We have 200 members.

The code sets out a framework of trade rules for how retailers and suppliers are to interact in certain areas and certain aspects. We are in very early days. What I have found over the last six months is a great willingness to discuss the code and issues related to the code, and an openness and a commitment to the principles and objectives of the code. That's all very positive, but time will tell if that willingness translates into a willingness to change practices. That's really what the code is about. I'm optimistic, based on the conversations I've had. Certainly, those who have been able to use the code in conversations have been effective.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

You mentioned around 200 members, about 38 of which are in Quebec. Why do you think so few companies are signing up in Quebec?

President and Adjudicator, Office of the Grocery Sector Code of Conduct

I think it has a lot to do with awareness building. Again, we're still in very early days with the code. My office is trying to do everything we can to raise awareness about the fact that the code exists, the importance of the code and the tools that people have available to them.

We launched something earlier in the year called “Code on the Road”. We are trying to meet people where they are to raise awareness about the importance of the code. I think over time we're going to get those numbers up. There's still some skepticism about how this code is going to play out, and we need to address that and make sure that those who should be part of the code and who will benefit from it become members.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

I'm among those who have high hopes in the code's ability to bring prices down. However, last week, the Competition Bureau pointed out to the committee that it could not address the imbalance in bargaining power between grocery stores and suppliers.

Have you already managed to make any progress on that? Do you feel that the power is now more balanced thanks to the code?

President and Adjudicator, Office of the Grocery Sector Code of Conduct

I'm very hopeful about the code generally, but the code does not address prices. That's a very important clarification.

I think the code helps businesses of all sizes get a level playing field when it comes to raising issues and having disputes addressed. That's very important. A company of any size can come to the office and deal with that without having lawyers or a big administrative burden. We can listen to their issues and try to address them. That's really where the code helps to level the playing field: People can access the office and the strength of the office to try to address the issues.

We will not fix the dynamic of difficult negotiations between very large players and very small players, but the provisions within the code try to at least create a fair framework in which those conversations can happen.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

It has been brought to my attention that horticultural associations have tried to use the code of conduct to meet with a retailer and discuss systematic problems affecting their sector. While we can understand that your job is precisely to mediate, your office did not accept that request. Why not?

Isn't part of your role to help mediate between retailers and associations such as horticultural associations?

President and Adjudicator, Office of the Grocery Sector Code of Conduct

We are not mediators. If a horticultural association, for example, has systemic issues they want to address that relate to the code, we welcome them to bring those issues to us. We will try to have conversations with retailers or others based on those issues. We do not bring parties together and mediate between them.

As part of the principles of the code, those in the industry are supposed to try to work things out among themselves. If those discussions aren't successful and there are code-related issues that our office can have our own conversations on and try to push in our own way using the tools we have, that's how the office operates. We are not a third party mediator.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

Why do you think it's still so difficult for small local producers in a remote region, such as mine, to get their products into grocery stores?

Why is it possible to find local products in some of the smaller stores but not in the major chains? What's the rationale?

President and Adjudicator, Office of the Grocery Sector Code of Conduct

That question falls a little outside of my area of expertise. I know that some of the large retailers have put programs in place to try to encourage and make it easier for local organizations and small companies to do business, but I can't comment professionally on why that continues to be difficult.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

That was a hope I had.

This is my last question: Since the beginning of your mandate, have you found any breaches of the code? If so, which companies have accumulated the most so far?

Liberal

The Chair Liberal Michael Coteau

You have three seconds.

President and Adjudicator, Office of the Grocery Sector Code of Conduct

We've received complaints and we've looked into complaints, but the complaint system we have is highly confidential.

Liberal

The Chair Liberal Michael Coteau

Thank you very much.

We'll go for another eight or nine minutes. Why don't we do three, three and two? Is that fair?

Some hon. members

Agreed.

Liberal

The Chair Liberal Michael Coteau

Go ahead, Mr. Bragdon.

Conservative

Richard Bragdon Conservative Tobique—Mactaquac, NB

Thank you, Mr. Chair.

I have a couple of quick questions.

The first question is for you, Ms. Proud.

We heard the finance minister a few years ago, when he was the industry minister, make the statement that the code would lower food prices. In your opening statement, you said that the code is not meant to lower food prices. I take it his statement was inaccurate. It really doesn't lower food prices, because I think Canadians would testify that prices are going up as they relate to food.

President and Adjudicator, Office of the Grocery Sector Code of Conduct

The purpose of the code is not to lower food prices. If there's something that happens in the end because of better business relationships, then perhaps, but that is not the purpose of the code.

Conservative

Richard Bragdon Conservative Tobique—Mactaquac, NB

Thank you for that clarification.

Mr. Graydon, Canada and the United States share one of the most deeply integrated agricultural and food systems in the world. It's been that way for literally hundreds of years now—back and forth across the border. It's so vital to our producers and farmers.

Right now, at a time when food security should be paramount when on the minds of every government in Canada, do you feel enough is being done to make sure this relationship is sound? Is all that can be done to mitigate areas of friction being done? Are the proper steps being put in place to keep Canada's producers and farmers in the best possible competitive position they can be in? We know they make good products and grow great food, but the challenge is, of course, the regulatory and tax burdens they're under.

Can you speak to that, Mr. Graydon?

Chief Executive Officer, Food, Health and Consumer Products of Canada

As far as the discussions on free trade with the United States and that relationship go, things are moving along. The fact that the CUSMA-compliant parts of our business have been carved out and that we have no tariffs on the majority of our business is very good.

This is an opportunity for Canada to open its eyes and focus a little more on self-sufficiency and a little less on reliance. While the trade component is very important, we've allowed a lot of manufacturing capacity to evaporate from this country and free trade to take some of the energy out of the productivity of this country. There needs to be a better balance.

We need to trade with the United States. It's a tremendous opportunity to grow and scale our businesses. At the same time, we can't have ultimate dependency. Unfortunately, there's an element of dependency that's crept in that we need to resolve.

Conservative

Richard Bragdon Conservative Tobique—Mactaquac, NB

In your estimation, Mr. Graydon, what things should the government be prioritizing or doing to make the atmosphere much more conducive to competitiveness for our producers so they can have a more sure and level footing for doing what they do so well?

Chief Executive Officer, Food, Health and Consumer Products of Canada

The regulatory environment here needs to modernize and be better aligned with today's manufacturing. Some of the Food and Drugs Act, for instance, is 70 years old. Things have changed. That modernization is required. Red tape reduction is required. There needs to—

Liberal

The Chair Liberal Michael Coteau

Thank you very much, sir.

I'm going to MP Harrison for three minutes.

Liberal

Emma Harrison Liberal Peterborough, ON

Thank you, Mr. Chair.

I'm going to jump right in.

Mr. Graydon, you wrote an op-ed after you were here in December, and I completely agree with you. You said, “Canada's productivity problem is a depth problem, not a talent problem”. You went on to talk about the grocery store aisles and how most of the products we find in the centre aisles were once manufactured here but are now almost all imported. In your opening statement, you said that part of this is a trade corridor problem.

Would you be able to elaborate specifically on the issues we have due to trade corridor inefficiencies in Canada?

Chief Executive Officer, Food, Health and Consumer Products of Canada

To a certain extent, many of the companies that do a good portion of the volume in this country are multinationals. It's the 80-20 rule: 20% of the manufacturers do 80% of the volume. That's a global issue. It's not just a North American issue.

This North American relationship of free trade has its values, but it has also created an environment where we're not as resilient as we should be and not as self-sufficient. We're not utilizing the opportunity of this agri-food superpower we have. Many of the agricultural products leave this country, are sent to the United States, are processed into ingredients and come back into this country with inflated costs that are applied to the operating costs or the input costs of the finished products.

Taking a better approach to getting a better balance among trade, resiliency and self-sufficiency in Canada needs to be done. We need to stimulate capital investment. We need to make it easier for these organizations. Many of them are foreign entities that have bet on Canada. We should be embracing them and finding opportunities to welcome even more manufacturing in order to continue to grow and to create the jobs that come with this.

Liberal

Emma Harrison Liberal Peterborough, ON

Thank you very much.

Ms. Proud, it's nice to see you again.

We talked a bit about the grocery code of conduct, and my colleague just talked a little about its ability to help with food security, particularly in Canada.

I was wondering if there's anything else you'd like to add about where this falls under food security.

President and Adjudicator, Office of the Grocery Sector Code of Conduct

As I mentioned in my opening remarks, it speaks to creating a better business environment between suppliers and retailers. When one does that—and hopefully the code achieves that in many aspects—it encourages more investment by suppliers in this country, as they know that they have clear business rules and a good relationship with their partners within the sector. That can certainly contribute to food security here. It also hopefully helps the smaller producers—who you've heard through this study—do more business with the grocers.

We're working hard in my office to try to identify exactly what the issues are for the primary producers so that our office can then go forward and try to address those issues. There are many issues within the sector. You've heard a lot of them. Only some might relate to the code of conduct, and we have gathered a group together to try to hear those concerns—

Liberal

The Chair Liberal Michael Coteau

Thank you so much.

President and Adjudicator, Office of the Grocery Sector Code of Conduct

Thank you.

Liberal

The Chair Liberal Michael Coteau

I will go to the Bloc for the final two minutes.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

Thank you very much, Mr. Chair.

Ms. Proud, the results of your 2025 survey, which you recently published in May 2026, indicated that small and medium-sized manufacturers, independent retailers and primary producers were uncertain about the benefits of the code.

Today, after six months of operation, what do you think are the positive effects of the code? What do you think small and medium-sized manufacturers, independent retailers and primary producers would say if they could fill out the survey now?

President and Adjudicator, Office of the Grocery Sector Code of Conduct

When it comes to small producers, as I mentioned, there are a lot of challenges within that sector, especially in having to do business with very large organizations. My office recently pulled together a fruit and vegetable liaison group so that we could specifically hear from some of the small producers—hear what their issues are and what issues may be related to the code.

I'm waiting to get that report. It's my deputy who's been managing that group and asking those producers to prioritize the issues they have that are code-related so we can go forward and have a look at them. If we can address some of those issues, we are hoping that we can make it easier for these organizations to do business and can address some of their major challenges.

I've heard about some of their complaints, but that's where we'll need to demonstrate the value to the primary producers for them to believe that there is value for them.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

I know you have answered that complaints and breaches are confidential, but can you tell us whether there are more complaints or more invitations for you to settle disputes? Can we get a general idea of the number of these complaints?

President and Adjudicator, Office of the Grocery Sector Code of Conduct

Yes. Next week, my office is going to be releasing our first-ever public report, in which we will talk about exactly what we have heard from January until now. We have received a number of complaints through our confidential process. It's not a huge number. We've received nine specific complaints.

We've looked at some. We've done some of our own information-gathering exercises. We've issued some guidance. We have had a few organizations inquire about more formal dispute resolution. All of that will be in the report that we release next week, and we will make sure to send a copy of the report to this committee. I'd be happy to come back at any time to talk about the contents of that report.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

Thank you very much.