Foreign Affairs Committee on Nov. 1st, 2023

[The Chair, Liberal, Ali Ehsassi]

I call this meeting to order.

Welcome to meeting number 80 of the House of Commons Standing Committee on Foreign Affairs and International Development.

Today's meeting is taking place in a hybrid format, pursuant to the Standing Orders. Therefore, members are attending in person in the room as well as remotely by using the Zoom application.

I'd like to make a few comments for the benefit of members and witnesses.

Before speaking, please wait until I recognize you by name. You may speak in the official language of your choice. Interpretation services are available.

Although this room is equipped with a powerful audio system, feedback events can occur. These can be extremely harmful to interpreters and can cause serious injuries. The most common reason for that sound feedback is that an earpiece is too close to a microphone.

With regard to the speaking list, the committee clerk and I will do our very best to maintain a consolidated order of speaking for all members, whether they are participating virtually or in person.

In accordance with the committee's routine motion concerning connection tests for witnesses, I'm informing the committee that all witnesses appearing virtually have completed the required connection tests in advance of the meeting.

I would like to point out that Mr. Matthew Hollingworth from the World Food Programme, who is joining us from Kyiv, is having some connectivity problems. The IT specialists have assured me that they're going to continue trying to improve the connectivity so that we all have the benefit of hearing from Mr. Hollingworth.

In the interim, we will get started with the other witnesses, and hopefully we will have good news as far as Mr. Hollingworth is concerned.

We will resume our study on the situation at the Russia-Ukraine border and implications for peace and security, pursuant to Standing Order 108(2) and the motions adopted by committee on Monday, January 31, 2022, and Tuesday, May 30, 2023.

I'd now like to welcome our witnesses.

From the Global Institute for Food Security, we have Ms. Alanna Koch, who is the chair of the board of directors, and Mr. Steve Webb, who is the chief executive officer.

From Producteurs de grains du Québec, we have Mr. Benoit Legault, who is the general manager.

From the United Nations World Food Programme, we have Mr. Hollingworth. We are attempting to make sure he has adequate connectivity.

We will start with Mr. Steve Webb and then go to Mr. Legault.

I would ask the witnesses to make sure that they don't go over five minutes for their opening remarks. The same is true when members are asking questions. If they're getting very close to the end of the time slot, I will put this card up. That is an indication that they should be attempting to wrap it up within 20 to 30 seconds.

Mr. Webb, the floor is now yours. You have five minutes for your opening remarks.

[Steve Webb, Chief Executive Officer, Global Institute for Food Security]

Good afternoon, Mr. Chair. Thank you for the invitation to be here today.

As mentioned, my name is Steve Webb. I'm the CEO of the Global Institute for Food Security at the University of Saskatchewan. We also refer to ourselves as GIFS. GIFS works with partners to discover, develop and deliver innovative solutions for the production of globally sustainable food.

Mr. Chair, insecurity and the lack of food security are very closely linked. Food security equals global security, and food insecurity is global insecurity. In fact, Dr. Norman Borlaug said, “You can't build a peaceful world on empty stomachs and human misery.”

Russia's invasion of Ukraine underscores this statement. Today I would like to touch on its implications for food security and how Canada can respond effectively.

A first implication is access to food. The global food system had barely recovered from the COVID-19 pandemic when this conflict followed, further threatening its sustainability. The war in Ukraine has impacted about 30% of global wheat and fertilizer production, placing added pressures on the food industry's ability to feed a large and growing population with even fewer resources. There are now over eight billion people in the world. Add to this the challenge of feeding this population with limited resources, and it's clear that we cannot afford threats to food or fertilizer accessibility and affordability.

Another implication is that we're witnessing a multi-dimensional problem, not just with food and energy but also with a realignment of relationships at the international level. The conflict is resulting in workarounds to access food, and not necessarily sustainably. These realignments create challenges for Canada's response to feeding the world sustainably.

Yet another implication of this conflict is pressure on supply, distribution and global trade. Food prices have skyrocketed across the world, and distribution, imports and exports have been impacted. An example is the Black Sea grain initiative and the uncertainties it has resulted in, as well as the impact of these uncertainties on the trade and distribution of food.

Global access to safe and nutritious food, which speaks to GIFS' bold vision, is threatened. We must do everything we can to bounce back from these challenges and help reinstate a food-secure world.

In view of these implications, here are some ways GIFS sees Canada responding effectively.

Not only is Canada one of the world's largest producers and exporters of food, but we also do so in a manner that is economically, environmentally and socially sustainable. We need all these tools in the tool box to meet the rising demand caused by various challenges, including Russia's war in Ukraine. This means we must embrace safe and trusted innovation. Our innovative, sustainable farming practices have already made Canada a success and given us some enviable data points. A recent study commissioned by the Global Institute for Food Security shows that sustainable practices in Canada have delivered a net carbon footprint for non-durum wheat over 120% lower than that of competitive jurisdictions. Innovation has made the difference, and it has helped make us one of the most secure and sustainable food producers in the world. We should keep it that way.

The next recommendation is to drive major capital investment in infrastructure such as telecommunications, rural connectivity, ports and rail systems. Investment in our infrastructure ensures Canada remains competitive and regains its reputation as a reliable food supplier.

Mr. Chair, our next recommendation is the creation of a transparent, predictable, interactive and enabling regulatory framework. All other recommendations hinge on this success. Our agriculture and food sectors are impacted by regulatory bottlenecks that limit producer and consumer access to the latest proven innovations. The recent private member's bill by MP Kody Blois is an example of a pragmatic approach to ensure Canadian farmers and producers have access to the latest innovations in order to remain globally competitive.

For example, for the agriculture and food sectors, regulations need agricultural, health and environmental approval through the jurisdictions. A highly functional regulatory framework is a competitive advantage for Canada, one that builds trust not only here at home but also globally. Let's build this.

Thank you, Mr. Chair, for this opportunity. I hope you found these comments useful and I look forward to further discussion.

[The Chair, Liberal, Ali Ehsassi]

Thank you very much, Mr. Webb.

We now go to Mr. Legault.

Mr. Legault, you have five minutes as well for your opening remarks.

[Benoit Legault, General Manager, Producteurs de grains du Québec]

Good afternoon.

Thank you very much, Mr. Chair.

Thank you to the committee members for having us today.

My name is Benoit Legault. I am the general manager of Producteurs de grains du Québec, which represents 9,500 grain producers in all regions of Quebec, who cultivate over one million hectares of land, generate an annual revenue of $2 billion and create nearly 20,000 jobs in Quebec.

We are always happy that political representatives show interest in getting the point of view of grain producers in eastern Canada, who represent 20% of grain sales in Canada. In Quebec, specifically, grain producers supply a series of agri-food sectors dedicated to the production of meat, flour and bread, oil and margarine, alcoholic beverages and ethanol.

Although Quebec grain producers export half a million to 1 million tonnes of corn and approximately 1 million tonnes of soybeans, the impact of their efforts on food production and food security depends largely on the price of their commodities and their inputs, which are directly linked to international markets and prices. For inputs, transport issues mean that effective relationships with suppliers in the Atlantic region are crucial so that our farmers can produce at competitive costs in the east of the country.

As a representative of grain producers, we support the principle that geopolitical conflicts should not interfere with the efficient and cost-effective movement of food, agricultural commodities and agricultural inputs. In this sense, obviously, we believe that the end of the trading relationship with Russia goes against this principle. Eastern Canada remains dependent on agricultural inputs from abroad, particularly for nitrogen, a crucial element for maintaining and increasing crop productivity. The reflex is to focus on developing production capacity in eastern Canada, but as you know, that is an enormous challenge given that the production of nitrogen is a heavy industrial activity requiring significant capital investment. Furthermore, it does not necessarily meet certain environmental objectives in Canada, since it produces a lot of greenhouse gas emissions, or GHGs. This situation represents a huge risk to our security and ability to produce food in eastern Canada.

Moreover, food security is an issue of better meeting international demand. A further rise in protectionism in an already unstable trade environment and various non-tariff trade barriers are hampering the efficient movement of agricultural commodities. Canada certainly has a role to play not just in standardizing trade rules, but also in promoting them to encourage the efficient movement of agricultural goods.

It is difficult to measure and understand what the final outcome of this war started by Russia will be. Russia is completely changing the landscape of trade and movement of agricultural commodities as it deploys new geopolitical and trade strategies, particularly with China. These unpredictable strategies are disrupting grain production and marketing around the world, including in Canada and Quebec.

Agricultural producers believe that the unstable geopolitical environment—with these conflicts, these divisions and the rearrangement of relationships between states—is a real threat to our production capacity, here and abroad. Producers, especially the next generation, feel overwhelmed and demotivated by this elusive reality, which is difficult to fit into a business plan.

As a representative of agricultural and grain producers, we have certainly not developed a Canadian vision regarding the management of international relations to ensure peace and security, and food security. We are simply returning to safe values, namely those that provide producers in Quebec and Canada with the conditions for a productive and profitable agricultural heritage. Above all, these conditions must be attractive to the next generation in order to properly respond to the challenge of food security.

In this sense, it is important, in our opinion, to do the following: not impose measures that restrict the movement at lower cost of agricultural commodities and agricultural inputs in and to Canada; develop a certain autonomy in the production of necessary inputs in eastern Canada; ensure standardization of international trade rules and always promote this idea at the international level; ensure that we have exemplary risk management programs and funding that enable us to properly address the issue of geopolitical upheavals without forgetting climate change; make substantial investments in innovation and access to new technologies; develop the necessary tools so that the information necessary for efficient production and marketing circulates well between actors in the agri-food sectors here and around the world; and finally, have a vision of agriculture and food that allows sustainable growth in agricultural productivity.

These are the main messages that Quebec grain producers asked me to convey to you today regarding the issue of food security in the context of this war launched by Russia against the Ukrainian population.

Thank you for your attention.

[The Chair, Liberal, Ali Ehsassi]

Thank you, Mr. Legault.

Now I just want to inform Mr. Hollingworth of this.

We did try to connect with you again. I know you went through the trouble, but given that you're joining us from Kyiv, unfortunately the interpreters are telling us that it's not possible, given the quality of the sound, for them to do their job.

You're obviously free to remain with us. If you would like to respond to any of the questions that are put to the witnesses, we would be grateful if you submitted written responses so that we can rely on your expertise and insights.

We offer our apologies for this connectivity problem.

Now we will go to the members. We start off with MP Hoback. You have six minutes.

[Randy Hoback, Conservative, Prince Albert, SK]

Thank you, Chair.

Thank you, witnesses.

Mr. Hollingworth, I feel bad for you. I would really like to have heard your testimony, for sure. Hopefully you can submit it by paper and at least we can read it.

I'm going to start off with you, Mr. Webb. I'm going back to my good old days at Flexicoil and Case New Holland when DowElanco was marketing all sorts of products in western Canada.

Canada was on the leading edge with no-till and zero-till practices and reducing inputs and diesel fuel usage and stuff like that. Then we took that technology to Europe, and Ukraine especially, and eastern Europe.

When we look at what's happened with the war, where do you see Ukraine's potential now, going forward? We've always had the issue, and now we can't get the product out of Ukraine. Poland is refusing to allow grains to be shipped through Poland because they claim there is a disruption to their market in Poland.

How do you see that being resolved in some way, and what kind of future do you see around that?

[Steve Webb]

Thank you for the question.

I'm glad you mentioned the innovation that started here in Canada regarding the development of no-till and minimum-till technology. One of the things we've seen here in Canada, particularly in western Canada, is incredibly high rates of adoption—over 90%. We haven't seen that in other jurisdictions, and that's one of the reasons that drive our sustainability numbers.

Regarding the situation in Ukraine, it continues to deteriorate, and access to help move product in Ukraine into the global market is being restricted, as you mentioned, on a variety of fronts. Again, I am not an expert in this area, but I cannot see a resolution to this until the conflict itself is resolved or alternative methods are used to ensure that the production in Ukraine gets to the global market. It represents a significant portion of oilseeds in particular, like those behind Mr. Hollingworth's picture. There was a picture of sunflowers—and that oil is important—as well as wheat from Ukraine.

I think that's a very important producer, a breadbasket, and we need to encourage the opening of that production into the global marketplace.

[Randy Hoback, Conservative, Prince Albert, SK]

Having that unpredictability and that instability in the marketplace is definitely going to have an impact or create an impact on prices when Canadians pay for food and people around the world pay for food.

Even before the war, we were concerned about lack of protein and the ability to feed the world. Now we see in Canada how depleted our infrastructure has become. For example, the port of Vancouver is ranked 298th out of 300 ports as far as reliability and operability are concerned, compared to the rest of the world.

What are the things we should be doing here that could maybe ease some of that instability occurring around the world because they can't get access to food?

[Steve Webb]

I think that's one of the reasons that, from a Global Institute for Food Security perspective, there needs to be investment in infrastructure to be able to be a reliable supplier. We do not have that reputation today because when you're at the bottom of the list, the ability to move product is hampered. It's an economic drag for us here in Canada, and a reputational drag for us here in Canada.

We need to find a solution that looks at the system we have and not try to just band-aid over one component of it. I think there needs to be a very strategic national imperative to make sure we have the infrastructure so that we can move our safe, sustainably produced product to the marketplace.

[Randy Hoback, Conservative, Prince Albert, SK]

Even if we have the production, we will still have a problem in actually getting it out of the country to fulfill the markets. Is that correct?

[Steve Webb]

That is correct.

[Randy Hoback, Conservative, Prince Albert, SK]

And I guess—

[Steve Webb]

We saw that earlier this year with labour disruptions as well as with infrastructure capacity and capability.

[Randy Hoback, Conservative, Prince Albert, SK]

All right.

Mr. Legault, you talked about fertilizer and fertilizer requirements in eastern Canada. I think one reason that there are no fertilizer facilities in eastern Canada is that there's no gas line going to eastern Canada.

If there were a gas line coming out of western Canada to eastern Canada and we had our own production of fertilizer, would it not alleviate some of the concerns and pressures you have with regard to getting fertilizer from Russia if you could say, “Hey, we can produce it ourselves or get it locally”?

[Benoit Legault]

Eastern Canada actually has access to natural gas from out west, via a facility in Sarnia, which gets the gas from Michigan.

You're probably familiar with the situation regarding the pipeline's viability, and the political and environmental concerns inMichigan around one of the three Great Lakes. As a supply source, its future is uncertain.

There was an attempt in the past to build a plant in Quebec, on the St. Lawrence River, but the problem was not so much the feedstock, but rather, the size of the investment required. What's more, in Quebec—and I assume it's the same in Ontario—heavy industrial projects can be very challenging because of all the environmental restrictions and the political landscape, which is very much geared towards reducing GHGs. All that to say, the project wasn't necessarily well received here, in Quebec. It was a very serious attempt a few years back, but it didn't get off the ground for the reasons I just mentioned.

[Randy Hoback, Conservative, Prince Albert, SK]

It puzzles me, because you can do a cement plant in Quebec and get it through the environmental process. You can do other aluminum heavy production facilities in Quebec, and they seem to find a way to get them functioning.

If you look at Line 5—you're talking about that going to Sarnia—it is up in the air as we speak, with the combination of what's going on in Michigan and the first nations in Wisconsin.

How do we ensure that you have a viable supply of nitrogen? We can ship it out of western Canada on trains when the trains decide to run, or on ships if they are not on strike. How do you see that being alleviated?

[The Chair, Liberal, Ali Ehsassi]

Mr. Hoback, you're 30 seconds over your time, so I'll ask for a 20-second response and no more.

[Benoit Legault]

I can't answer that. Supply can certainly pose a challenge, but I don't have a lot of expertise in that area. All I know is that supply wasn't necessarily a problem for the plant that was supposed to be built on the St. Lawrence River, in the Bécancour area.

[The Chair, Liberal, Ali Ehsassi]

Thank you.

We now go to MP Chatel. You have six minutes.

[Sophie Chatel, Liberal, Pontiac, QC]

Thank you, Mr. Chair.

Thank you to the witnesses for being with us today.

Mr. Legault, the Organisation for Economic Co-operation and Development, or OECD, released a report entitled “OECD-FAO Agricultural Outlook 2022-2031”. According to the report, “overall agricultural productivity would need to increase by 28% over the next decade” in order to stabilize production and achieve global food security. It lays out recommendations to achieve that goal, but we are not there yet. The targets haven't been met yet, and there's still a lot of work to do.

In the report, the OECD says that comprehensive action is urgently needed to support investments in agricultural innovation as well as “the transfer of knowledge, technology, and skills.” Efforts are also needed to “reduce food loss and waste, and limit excess calorie and protein intake”.

I'd like to hear your thoughts on that.

[Benoit Legault]

I certainly can't disagree with the findings in the OECD's report.

I represent grain farmers, and grain is a crop that serves as the basis for many foods in Quebec. The challenges probably aren't the same for grain production as they are for meat production or grain processing for food products.

Innovation is always a concern for processors. Every year, we call for increased productivity every time we undertake a new Canadian partnership, and develop new programs and policies. There was a lot of emphasis on innovation under the last partnership we undertook in Canada.

Obviously, we realize that public resources aren't where they need to be, and that's one of our concerns. We are feeling the impact of that in the agri-science clusters. Public investment seems to be struggling to keep up with the innovation that's required.

Quebec is unique on that front, though. Since it's a small region, there's less innovation in the private sector because the market is small for developing products. We rely a lot on public support, which plays a very important role when it comes to innovation in regions like eastern Canada, especially Quebec.

Innovation is happening, and we're seeing growth in a number of crops. However, we are starting to hit a ceiling as far as soy and small grains are concerned. We are still seeing growth when it comes to corn, but things are also slowing down somewhat.

The level of growth you talked about is huge. I'm not sure that Quebec's plant-based productivity or output will be able to achieve the level you mentioned. We definitely need to take a giant step forward to increase productivity that much. As I said, we need strong support, a high degree of innovation and technological development.

[Sophie Chatel, Liberal, Pontiac, QC]

Thank you.

I think the government made great strides with the provinces with the sustainable Canadian agricultural partnership, which included $500 million in new funding. I could also mention the resilient agricultural landscape program. According to the OECD, investing in resilience and innovation is really the way to deal with climate change, which has a major impact on agriculture.

For comparison purposes, I had a look at studies focused on other countries, mainly those in Europe. In some countries, the level of investment is nearly double. One possibility for investment is through technology.

Have you found that support is lacking on that front, whether in terms of tax credits for agricultural technology and innovation or direct subsidies?

What does your organization recommend in that area?

[Benoit Legault]

The inclination is clearly to put forward tax credits that support innovation. In the agricultural sector, with the size of businesses and farmers' bottom lines, the tax credit would have to be fairly significant. It can, however, have a limited impact, especially since we are entering a period where margins are going to drop. That's what we are observing.

Things have been fairly good in the past few years, but with the downturn, higher production costs and lower market prices, on the horizon, we definitely see farmers' margins and net revenue declining. A tax credit could be helpful, but would probably have a smaller impact.

Subsidies are certainly an important tool. The countries that make the smartest and largest investments will probably be the ones that come out on top. Of course, producers and the industry have to do their share as well.

How much investment is required? It's hard to say today. All I can tell you is that, in today's dollars, the government reduced its support for innovation.

Do we need fewer subsidies than before? Are we doing a better job innovating than we have in years past? I can't answer that, but I can tell you that, for grain producers, it's always better to invest more, as opposed to not enough. This may be a conflict of interest, I'll admit.

[Sophie Chatel, Liberal, Pontiac, QC]

Thank you, Mr. Legault.

[The Chair, Liberal, Ali Ehsassi]

Thank you, Mr. Legault and Mrs. Chatel.

Welcome, Ms. Larouche. You may go ahead for six minutes.