Good afternoon, Mr. Chair and committee members. Thank you for the opportunity to speak with you today.
Plant-Based Foods of Canada, a division of Food, Health & Consumer Products of Canada, is the collective voice for companies that make and market plant-based foods.
One of our greatest strengths is our unique membership, farm to fork. With almost 80 members spanning from manufacturers and retailers to ingredient processors, this presents enormous opportunity for collaboration and leveraging the diverse expertise of our members to make plant-based foods more accessible.
Advocacy, insights and enabling our members to grow and scale are our primary areas of focus. Working with government to address the regulatory challenges facing the industry is a key priority.
Plant-based food products are growing faster than total food and beverage products. Now more than a $1-billion market in retail in Canada, as measured by NielsenIQ, it is forecasted to continue to grow. Consumers are prioritizing longer, healthier lives without preventable diseases, which leads to why health continues to be the number one reason consumers purchase these foods. Over two-thirds of Canadians purchase plant-based foods frequently, with 30% indicating that they plan to consume more. This all points to the potential for a thriving Canadian industry.
The Government of Canada has identified plant-based proteins as an economic driver. The development of the protein supercluster, which was originally awarded $165 million to accelerate its growth, has now been re-funded a share of the $750 million allocated in the recent federal budget. This is recognition of the role that this industry can play and the global opportunity for Canada.
In contradiction to this, the current legislative requirements impacting plant-based foods are resulting in regulatory burden for industry. They are outdated and not keeping pace with innovation and technology, consumer demands and a global marketplace. It is challenging for those who are trying to bring innovation to market, particularly for small to mid-sized companies with limited resources and finances. Over 80% of the PBFC membership falls into this group. Unique formulations are required for products in Canada. This is particularly true for products with compositional requirements, like simulated meat, which requires mandatory fortification, and dairy products, where the ability to fortify is difficult and limited.
Mandatory fortification with specific vitamins and minerals for simulated meat and simulated poultry is antiquated and not aligned with today's consumer and their consumption patterns. With current health and environmental concerns, consumers now want a variety of protein choices with clean, simple ingredients, and do not rely solely on these products to meet their protein needs. The current regulations that evaluate plant-based products against animal-based products are inconsistent with how consumers are incorporating these foods into their diets and result in a long list of ingredient statements that consumers don't recognize.
In the case of plant-based or non-dairy products, there are no formal regulations guiding fortification, and the current interim measures are restrictive for developing products with comparable versatility to milk. A framework to permit fortification is required for plant-based foods including non-dairy cheeses, non-dairy yogurts, beverages and others, to allow for innovation in the category.
Labelling of these products is a challenge across the industry. Regulatory modernization, including labelling that makes sense and is in line with where consumers already are, needs to be addressed. Consumers are not confused by terms such as plant-based burgers or oat milk. They are already part of their vernacular as descriptions of these products.
Modernization is needed to reflect innovations in the marketplace and the latest consumer demands. The use of common names like “butter”, “cheese”, “meat” or “milk” to identify plant-based foods is prohibited in Canada, although these words describe the functionality or applicability of the food. As a result, companies are forced to find creative ways to describe the products, either through variations in spelling or using words like “type”, “style” or “beverage”.
The requirements regarding the use of common names for products whose labels clearly indicate that the product is plant-based, vegan or vegetarian, by using terms like plant-milk or plant-butter, need to be re-evaluated.
Lastly, the requirement to label simulated meat and poultry products as “simulated” is redundant and unnecessary, and confuses the consumer, since these products clearly communicate that the product does not contain meat by using designations such as “plant-based”, “vegan” or “vegetarian”.
Canada is home to an incredible number of entrepreneurial start-ups in this space. They are pioneering new foods that are leveraging Canadian crops and creating jobs at home. The bottom line is that it is easier to develop products for outside of Canada than within, and that results in a burden for SMEs and the industry.
The inconsistency in the government agenda is evidenced by the fact that regulatory modernization for these products is not even on the forward regulatory agenda to 2024. This is despite the recognition of the importance of this segment of the food industry to Canada.
Regulatory modernization is necessary to support and respond to the increased market demand for plant-based foods. The current regulatory framework is both restrictive and impeding innovation.
Thank you for the time. I'd be happy to provide any research, or written materials, as a follow-up to this.