Bill C-18 Committee on Nov. 2nd, 2011

[The Chair, Conservative, Blaine Calkins]

Thank you, Mr. Anderson.

Mr. Valeriote, your time has expired already.

I was assessing the nature of the exchange between the minister and Mr. Valeriote. I do believe that they were engaged in a good discussion. I believe the minister had his opportunity to answer his question. I believe Mr. Valeriote had his rights as a parliamentarian respected in asking his question.

Our next questioner would be Mr. Zimmer, for five minutes, please.

[Bob Zimmer, Conservative, Prince George—Peace River, BC]

Thank you, Minister, for coming out tonight.

To me, personally, this bill rights a wrong, where western Canadian farmers have long been denied the freedom to sell their grain to whomever they choose, even to the extent that some hardworking farmers have gone to prison for that. The opposition has criticized our expediting an efficient process to pass our freedom for farmers bill.

Can you tell us why it is important to pass this bill as quickly as possible for the benefit of farmers?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

As we've said all along, Mr. Zimmer, it's about certainty and clarity, including for the farmers who are doing fall work right now. In your part of the country, they're putting on fertilizers and chemicals to get ready for next year's crops, and they need to know what they're going to put in their air seeder and go out and do the seeding. We're making sure they have the knowledge that they will be able to market their own commodity after August 1, 2012. It's the same thing with the whole grain value chain: They need to know what's going to be required of them.

To that end, both CN and CP are doing over a billion dollars worth of renovations on their main lines across western Canada, because they know there are going to be demands on them to move more product more quickly than they do now, because we won't be dragging our sales out at the rate of one-twelfth every month, as the Wheat Board does now. There will be a lot more moving off the combine and a lot more going to market positions earlier, getting us away from starting our trucks and our augers at minus 40 degrees in January. It used to drive me nuts. I'd wait for a malt car until it was the coldest, wettest, or muddiest day of the year. Now we'll be able to put that product into market position ahead of time.

[Bob Zimmer, Conservative, Prince George—Peace River, BC]

You've explained that very well, but further to it, could you expand generally on how this bill provides for market certainty for the farmer?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Western Canadian farmers have proven over and over again their expertise in marketing. They've built world-class systems in canola and pulses and other specialty crops. They've done the same thing with livestock, cattle, pork, and so on. We know they can do the same with wheat, barley, and durum. We know they will work together and start to do more value-added commodities.

There are changes required around the world. Even when I talk to entities that are dealing with the existing board now, they always ask, can I have a little more choice in what I want? It's been too prescriptive to this point. Certainly, that's where the Canadian International Grains Institute comes in; it does a tremendous job of showing other countries what they can do with our product.

I was at the largest flour mill in the world in Jakarta, Indonesia. They had stopped buying Canadian wheat. They're now back up to a $200 million per year system, simply using good, top-quality Canadian wheat to blend with everything else they buy, to make sure that the bread rises.

So we know there are markets out there. We know we can get a premium for our product and that we are not going to have to wait 18 months to get a final payment. You're going to be able to sell it to whomever you want, deliver it when you choose, and make that contract with your buyer. Whether it's with a farmer-owned terminal out there in western Canada or with Viterra or Cargill, you choose.

[Bob Zimmer, Conservative, Prince George—Peace River, BC]

Do I still have some time?

[The Chair, Conservative, Blaine Calkins]

You have more than two minutes.

[Bob Zimmer, Conservative, Prince George—Peace River, BC]

I guess my next question speaks more personally and is related to my riding. We've heard what you've said about the opinion of Canadians on the ground is.

My relatives in Manitoba weren't allowed to vote. For whatever reason, they didn't receive a ballot, and even then the ballot didn't list the third option that we're providing—the hybrid option, I like to call it.

What are you hearing on the ground? What has been the best news with the progression of Bill C-18 and what it's leading to? What are the good stories you've heard about what is going to come?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

I've been hearing a lot. I listened to Jeff Nielsen talk about there being 20,000 commercial farmers in western Canada and that 66,000 ballots went out. Who did they go to? I get all kinds of stories from farmers about estates getting a ballot—a guy had been dead for three years and still got multiple ballots—and landlords who aren't farming. Anybody who had inputs could actually apply for a ballot.

That's the old description. The people we need to talk to are the actual producers, people who have their shoes on the ground and in their tractor cab and are actually making decisions and moving forward with their farm enterprise in western Canada. Those are the people we need to talk to, and we do that every weekend.

I made that comment in question period the other day. We go home on a weekend. I did that yesterday in Alberta. I met with about 50 farmers in Leduc, talking about the great opportunities moving forward. They're pumped; they're ready to go. They have their fall inputs in. They're going to actually start to grow....

We've had tremendous slippage of our wheat and barley acreage in western Canada. We're down to almost half of what we used to grow because guys have gone to other rotational crops. They're going into canary seed and triticale and myriad other things simply because they need a rotational crop for their canola, to offset clubroot or whatever it is. They're just moving away from the wheat, durum, and barleys.

We know there's a hungry world out there, we know there's a growth market out there, and we know we can produce the best. It's just a tremendous opportunity to move forward.

[The Chair, Conservative, Blaine Calkins]

Thank you, Mr. Zimmer.

Moving on, we have Ms. Ashton, for five minutes, please.

[Niki Ashton, NDP, Churchill, MB]

Minister Ritz, to follow up on the theme of Churchill, you know that Port of Churchill either directly or indirectly affects 200 jobs in a community of about 1,000 people. Approximately 95% of what goes through the Port of Churchill every year is board grain. For decades it has provided a more cost-effective option for farmers. Moreover, the work that has come as a result of the board grain that comes through has meant employment for many people, who are then able to raise their families in the community of Churchill.

As you can probably imagine, given that 95% of what goes through the port is from the Wheat Board, the announcement that the Board will be dismantled has brought a great deal of uncertainty to people in Churchill. Yesterday, I had the chance to ask Mr. MacKay, the Commissioner of the Canadian Grain Commission, how many people from the Grain Commission will lose their jobs in Churchill.

Unfortunately, the answers to that question were not brought to the attention of our committee.

My question is, for the financial commitments that your government has made, when will we be hearing the details of how the money will be rolling out? When will the town of Churchill—the mayor and the town and other players on the ground in Churchill—be consulted on the way that money is going to be rolled out? When will we hear the details as to how many of the people who stand to lose their jobs as a result of wheat no longer going through the port might be hired as a result of the money committed by your government?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

All we can do is to make sure that the status quo is assured. What we've done is to dedicate $5 million a year to provide incentives for the grain—the same as the Wheat Board was doing—to move through the Port of Churchill. What that will do is to allow farmers to hold it for a little longer, to run it up there during that short window of opportunity they have. Churchill has about 250,000 bushels of storage, and they need about double that. So they need to run some during other parts of the year when the ships are in. They need a sort of “best before”, and that's problematic.

Having said that, the same incentive value is there now, but we have gone beyond the board grains. As I said, two boatloads of pulses went through there at the end of the season, and we're hopeful there will be more of that. This incentive now will apply to the canolas, the pulses, and other crops as well as to the Wheat Board crops. So it's a broader diversification for Churchill, should the board not use it any longer.

Now, I also would point out that the board was intending to move a lot more product through Thunder Bay, in buying two lakers. So maybe they were already starting to move away from Churchill. We don't know that. That would be unfortunate.

[Niki Ashton, NDP, Churchill, MB]

Right. Well, what we do know is that the Wheat Board made a consistent commitment to Churchill, and not just for the community but also for prairie farmers.

I also want to point out that there was a reference to $14 million for a new airport. The airport in Churchill has been around for many years. The railway also was referred to as being usable in the winter. The railway works year-round. I say this just so that we're clear on some of the details here.

The reality remains that people are feeling extremely uncertain when it comes to their jobs, which they fear will be lost if grain no longer goes through.

We've also heard that, given that Cargill, Viterra, and other corporate entities do not have the infrastructure in Churchill, they will likely stick with where they do have the infrastructure, which is in the other major ports across the country. This, as you can imagine, encourages the feeling of uncertainty that people in Churchill and across the north in Manitoba are facing.

The next question I want to ask, Minister Ritz, is this. You made reference to hearing from farmers. The elected directors, of course, are elected by farmers on the ground. I'd like to know whether you have ever met with the entire board of elected Wheat Board directors?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Just to follow up on your point on Churchill, when we're talking about realities, you should also know that Omnitrax, an American corporation, owns the rail and the port, and there's a VIA Rail train that runs on that same set of tracks on a weekly basis. So I just point out those facts as well.

[Niki Ashton, NDP, Churchill, MB]

Yes, I'm aware of that. It is my riding.

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Yes, exactly. Good for you.

I've met with a number of the directors from time to time. I've never been allowed to attend a board meeting. I've asked a number of times to do so. They have always said now is not a good time, or the directors don't really want to hear from you.... There are a number of different reasons that I've been told, and I was never allowed to attend a board meeting.

[Niki Ashton, NDP, Churchill, MB]

Have you ever been invited?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

I've met with the board at other places of their choosing, with some of them various places around the world, when we have been at the WTO; with some of them in Ottawa; and with some of them in other places. Ken Ritter, the former chair, was a constituent of mine. I met with Ken a number of times on board issues. At that time, Greg Arason was the chair. I met with him a number of times. I've also met with Mr. Oberg and Ian White at separate facilities throughout the years.

[The Chair, Conservative, Blaine Calkins]

Thank you.

Ms. Ashton, you've gone a little over the time. I appreciate the exchange.

Mr. Storseth for five minutes please.

[Brian Storseth, Conservative, Westlock—St. Paul, AB]

Thank you very much, Mr. Chair.

Also, I'd like to say that this is the first time I've seen this. We have the member for Crowfoot and Senator Plett, for example, who've here the whole time sitting in the back. It shows the importance of this issue to western Canadians and western Canadian farmers, Mr. Chair. So perhaps we could extend the table on this side and borrow some on that side.

On behalf of constituents like the Adair family, the Bower family, and thousands of others across my riding, I'd like to thank Minister Ritz for bringing this bill forward. Freedom for farmers is something they have been looking to have for an awful long time.

I'd like to maybe bring the minister back to when he was first Minister of Agriculture and Agri-Food. I was sitting on this committee demanding an answer as to when we were actually going to get some movement on this. So it's great to see this, Minister, as it is a historic occasion. I would like to congratulate you on this.

One of the concerns that I do have, Minister, is all the fearmongering by the opposition to this bill. The tactics they have used to scare individuals don't seem to be getting any traction in western Canada. Even at this committee, we're hearing young farmers, entrepreneurs, and small businesses coming forward saying they see opportunities within this bill.

I'd like you to comment on the opportunities that you see for businesses in my riding, such as Westlock Terminals, and the independent terminals as a whole. Could you comment on the opportunities that you see being created for them through this bill?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

There's been a huge paradigm shift, as you probably know. This is my 15th year of representing the great people of Battlefords—Lloydminster. We campaigned on this in every campaign I've been was involved in—and this is my seventh, if you count the one where I was campaign manager. There's been a tremendous and growing acceptance that this is what needs to be done.

Farmers have seen the ground shift and know that they can do a better job. They know that they need to market their own product at the time, place, and price of their choosing for their own business bottom line.

When it comes to Westlock Terminals, certainly there'll be a tremendous opportunity for them to increase their volume by taking advantage of the board's pooling capabilities. The new entity will either be able to offer a pool on any of the commodities—anything that's grown—or they can operate as a broker, but they're going to need bricks and mortar to move these commodities through.

They can buy from farmers up in your country, move it through Westlock Terminals, which, of course, is good for them because it's all dependent on economies of scale, volumes, and so on. It gives them better access to their own port, which they're a part of with Alliance in Vancouver.

I think it's a great opportunity for some of these privately owned, farmer-owned terminals to work with the new entity.

[Brian Storseth, Conservative, Westlock—St. Paul, AB]

Thank you very much, Mr. Minister.

The other question I have is regarding freight issues. As you know, I've been a proponent of some of the freight issues that we have in the system. One of the things we've heard at this committee is a concern from producers that not enough is being done to enhance Canada's rail freight system. A working group has recommended the need for action on the rail service review.

Can you please explain to the committee what the government's plan is for proceeding with the rail service review and how it will affect the transition to an open market?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

There have been a growing number of concerns about the logistics. The Wheat Board always said they championed better rates and so on, but in some cases a better rate didn't necessarily get your product to market on time. You ended paying to merge and store it, and a whole bunch of other things that negated that buck a tonne they said they had negotiated for you.

The rail freight review, of course, is under Transport Canada, not me. But we have taken it upon ourselves to put together a comprehensive agricultural package. We will continue to work with industry in that regard.

As you know, Jim Dinning has just been announced as, and accepted the role of, facilitator in that enterprise. I think Mr. Dinning will do a tremendous job. His background says that he's been a tough negotiator with industry. He's done some great work in Alberta and I know he'll do a great job for us in facilitating the rail freight review.

I think there's a tremendous opportunity to start more value added on the Prairies, as we're already seeing in a couple of announcements that we've made. We'll see our freight rates change drastically so that the commodity can be processed right there at point of production and then moved out by truck, train, air, whatever it takes.

There's a growing demand around the world for processed goods, not just hewers of wood and drawers of water, as we've been for years in western Canada. We've been forced to be. I think that whole value-added side is just going to mushroom.

[Brian Storseth, Conservative, Westlock—St. Paul, AB]

Thank you very much, Mr. Chair.

Minister, we've heard there will $450 million to $628 million more per year to western Canadian farmers. We've heard there will be up to 28,000 new jobs, from different studies and reports that have been put forward at this committee. One of the things that we continually hear is that marketing certainty is necessary for this to move forward in an orderly fashion. Can you emphasize the importance of that, and how we're going to get and maintain that marketing certainty?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

We've said all along that certainty and clarity have to underscore this. That's one of the reasons for the speed with which we're doing this. Of course, governments are always criticized for not working at the speed of commerce. In this case we are, and we're being criticized by the opposition because we're moving too fast.

But we've been in this situation for decades. I've listened to the debates and watched with interest the last couple of nights, but I really haven't heard anything that I haven't heard for the last 20 years. It's about the same arguments over and over and over, and there's not one good reason not to do this. So we will deliver this and give clarity and certainty to the marketplace in western Canada.

Farmers, we know, are adapting already. We know they have the ability to step up and make this work. We know that industry is ready to roll up its sleeves and work with them. There have been a number of tremendous public pronouncements. Viterra has said it is more than happy to work with the new entity and to move that product through the Viterra infrastructure and system. That's fantastic. That's the type of thing that needs to happen, partnering up and moving forward.

That whole value chain is going to get a tremendous commercial bump here.