Evidence of meeting #48 for Finance in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was funding.
11 a.m.
Ross Gaudreault President and Executive Director, Quebec Port Authority
Good morning, Mr. Chair.
My name is Ross Gaudreault, and I am the president of the Quebec Port Authority, not to be confused with Quebec pork.
11 a.m.
Some hon. members
Oh, oh!
11 a.m.
President and Executive Director, Quebec Port Authority
Mr. Mulcair, Ms. Gagnon, good morning.
Ladies and gentlemen, I have been the president of the Quebec Port Authority for 22 years. Here with me today is the executive vice-president, Marcel Labrecque. When I joined the Quebec Port Authority 22 years ago, the port was in a very bad state. It handled 11 million tonnes and served zero passengers. After 22 years, this year, it handled nearly 28 million tonnes—making Québec the second largest port in Canada, in terms of tonnage. Furthermore, we also served nearly 100,000 passengers.
We have a problem: we have run out of space. We need to expand. We have a three-step plan for our expansion. The first phase involves a system to improve our loading and unloading procedure, given that we are now a port of the Great Lakes, which has become the Port of Québec's source of strength over the years. That is what has made the Port of Québec so successful: the fact that we serve the American and Canadian Great Lakes. We are competing with the American east coast and New Orleans. We serve everything from the steel plants to western Canadian farmers. We truly are a port of the Great Lakes, Ontario and western Canada.
So, we have run out of space, and we plan to expand two wharfs. This absolutely crucial. We have a three-step plan. The first phase consists of outfitting the Port of Québec with more modern equipment. Indeed, when we reached the point of having no more space, ships were paying a fee of $200,000 a day. We could not allow ships to anchor. We therefore invested $30 million in a new, faster unloading system, which will allow ships to get back on the water quicker and not have to pay a $200,000-a-day fine. We ordered the new machine, it has arrived, and we are in the process of installing it, but unfortunately we could not benefit from any funding from the new infrastructure Canada program, because we had already ordered the equipment. At the time we had to borrow $30 million from the Royal Bank, and we have nearly finished installing the new machine.
As the second phase of the plan, a new liquid bulk terminal is absolutely essential, given that we provide all of Air Canada's jet fuel for Pearson International Airport. It goes through the Port of Québec. Since we have run out of space, we must build a new wharf for liquid bulk and we need to deepen our wharfs. Indeed, the success of the Port of Québec stems from the fact that it is a deep water port. As a result, Quebec can accommodate ships of up to 125,000 and 150,000 tonnes, and unload them onto lakers that sail on the Great Lakes. We currently have only one 15 metre wharf, and we need to deepen wharf 51-52 to 15 metres.
The third part of our plan consists of building two new wharfs to allow us to meet increasing business demands.
Thus, we are here this morning calling on the federal government to develop an infrastructure program adapted to the needs of Canadian port authorities, one in which the federal contribution represents 100% of the cost of structural infrastructures.
Furthermore, we are also asking the Government of Canada to acknowledge the importance of the Port of Québec to the development of Canada's international trade, by allocating a budget of $383 million over three years, funding that would allow us to complete the three aspects of phase two of our expansion project.
Thank you.
11 a.m.
Conservative
The Chair Conservative James Rajotte
Thank you very much.
We will now proceed to questions from the members.
We will begin with Mr. Pacetti, who has seven minutes.
11 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
Thank you, Mr. Chair.
I would like to thank the witnesses for their presentations. It is always interesting. One of our challenges is to ask all our questions in a limited time period.
I would like to begin with Mr. Verret. With respect to the pork market, what has been happening around the world over the past two or three years? Has there been less demand or increased competition?
11 a.m.
Executive Director, Fédération des producteurs de porcs du Québec
A little of both. First of all, in recent years, the value of our dollar has risen, which makes it harder for us to compete.
At the same time, demand continues to increase. Pork is the most commonly eaten meat around the world, more so than chicken or beef. Some 50% of the world's pork consumption is in China, which is a growing economy and where demand is increasing.
11:05 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
Are there problems penetrating markets in Asia, like the Chinese market? If I am not mistaken, Japan was once a major importer of pork.
11:05 a.m.
Executive Director, Fédération des producteurs de porcs du Québec
Yes, Japan is a major pork purchaser. It is our biggest pork purchaser after the United States, which is our main customer. Japan is the main customer at this time. The customer of the future is China. Yes, we are having difficulty exporting to China, because our plants were closed due to H1N1, the virus known as swine flu, but what we need is support campaigns to reopen those markets. This is in the works right now.
Worldwide pork consumption is increasing and will continue to increase. We are currently facing a global crisis. Because of this crisis and H1N1, pork consumption has dropped recently, but we should see a recovery in a few years.
11:05 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
There has been no help from the government during this time?
11:05 a.m.
Executive Director, Fédération des producteurs de porcs du Québec
We have had some help from the provincial government and federal programs like AgriStability. However, in the case of AgriStability, assistance is decreasing gradually over time. When a crisis goes on for too long, assistance disappears.
11:05 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
I am not an expert in this area, but I know that recently, the government implemented a program specifically for pork producers. Do you not support that program?
11:05 a.m.
Executive Director, Fédération des producteurs de porcs du Québec
Yes, we do support it. In recent weeks, the government announced a $75 million program. This funding, however, is for the short term. However, our report deals with medium- and long-term structural aspects, not short term solutions. We will work with these programs as well as provincial programs.
11:05 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
In your first recommendation, is there a dollar amount?
11:05 a.m.
Executive Director, Fédération des producteurs de porcs du Québec
This report was prepared by a group. It must be associated with the Fédération des producteurs de porcs du Québec and the Canadian Pork Council. It will involve hundreds of thousands of dollars, but not millions or billions.
11:05 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
Quickly, please. This time has been allocated to me; it is not the Chair's time.
11:05 a.m.
As an Individual
As Mr. Verret was saying, pork producers, people from the industry and from the federation, came together this summer. The industry was facing a problem. Yes, cash is needed in the short term, but really, pork producers are wondering if the industry has a future. Financial assistance is needed, but we also need to ask some serious questions about the future of pork production. If structural changes need to be made after that, we will have the tools to do so. Producers are wondering if they should continue producing.
11:05 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
That was my question. Thank you.
Mr. Gaudreault, our committee is currently travelling across the country. Last week we were in Vancouver. Major investments have been made in British Columbia in the wake of the Pacific Gateway Strategy to the tune of over $500 million, even $700 million or $800 million. Before you answer this question, I would like to ask you another one.
Is the Port of Quebec in competition with other ports in eastern Canada, those of Halifax, Montreal or Trois-Rivières, for example?
11:05 a.m.
President and Executive Director, Quebec Port Authority
No, we are not really in competition with other ports along the St. Lawrence. We are not in the same market. We are the Great Lakes port; we send shipments to the Great Lakes on both the U.S. and Canadian sides.
11:05 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
In that case, do you not think it is time to consider a common strategy for all ports in eastern Canada to expand markets and boost international trade with Europe?
11:05 a.m.
President and Executive Director, Quebec Port Authority
The Government of Canada has set up trade corridors for western Canada, Ontario and Quebec and for Atlantic Canada. Of the money allocated to those trade corridors, very little will go to the ports. All of it is going to the railway, roads, bridges and airports. There will be nothing left over for the ports. That is why we are here today. Had we received money within the framework of the trade corridors, we would not have made a project application. There is no money for us. A decision needs to be made: do you want ports or not? That is what it comes down to.
11:10 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
If the railways are linked to roads that have access to ports, but the latter are not part of the project, then I wonder what the strategy is. However, that is not the situation in Vancouver.
11:10 a.m.
President and Executive Director, Quebec Port Authority
In Vancouver, the budget to implement this trade corridor was $2.5 billion. It was easy to make plans with that kind of money. We do not have that kind of budget. We are not getting government handouts. Every year in the Quebec City area, we generate $600 million in our regional economy. We are directly or indirectly responsible for 6,000 jobs in Quebec City, and what is more, we pay the federal government $54 million in taxes every year. We pay $100 million in taxes to the Government of Quebec. We are fuelling the economy.
I was head of the alliance that brought together the three Americas in Washington. Hundreds of thousands of dollars were spent every year to try to find a motto to illustrate the importance of ports to the economy. We found one this year, “Ports bring prosperity”.
“Ports bring prosperity”.
It is true. That is an important aspect of transport in Canada, and the least polluting one as well.