Evidence of meeting #15 for International Trade in the 40th Parliament, 2nd session. (The original version is on Parliament’s site, as are the minutes.) The winning word was quebec.
A recording is available from Parliament.
Liberal
John Cannis Liberal Scarborough Centre, ON
I don't have any more time for questions, but I really want to know a little bit more about it. If you could send me something on it, I'd really appreciate that.
Conservative
The Chair Conservative Lee Richardson
We may get back to that.
I'm going to move now to Mr. Guimond.
Claude Guimond Bloc Rimouski-Neigette—Témiscouata—Les Basques, QC
Thank you, Mr. Chairman.
I would like to welcome our guests.
I am very happy to see that all the members are taking an interest in the topic of today's meeting, namely the cattle industry. I am very much concerned about one other aspect of the industry, mainly traceability. As Ms. Marchand was saying, for several years now we Quebec farmers have been working on the establishment of this system, which operates very well and which deserves to be exported to the rest of Canada.
In my opinion this meeting is of particular importance, because it is being held just before our trip to Washington to gain a better understanding of what is happening on the American side and to try to influence them in this debate and the restrictions relating to the marketing of meat in the past few years. For example, in recent years we had the mad cow disease crisis.
As Mr. Read was saying, we are going to try to better understand the pros and cons of the American COOL standards.
My first question is for Mr. Read. Would it be advantageous for Levinoff-Colbex if we insisted more on traceability, working together with the rest of Canada?
General Manager, Levinoff-Colbex S.E.C.
We've always thought that having traceability just shows the control and the concern about the livestock and our herd in this country. It's a foundation; it could be a foundation to make sure that borders stay open, because we all know the downside if borders close.
As long as we want to be export dependent, then I think we should move this forward. I'm that close to using the word “mandatory”, because I believe it could, in the long term, bring value to our product. The issue you have is that if you want to be a leader.... All the pros say that if you can trace back, it will make you a real leader in the world.
In the province of Quebec, they're able to do that under the ATQ. They've made great efforts. Linda and her staff have done a great job. They're able to do that from the calf from seven days, and so on and so forth; I won't go through her presentation again.
As we move forward, I think it might become a reality that it will be a requirement by other countries: if you can't trace it, you can't sell it. We've heard that domestically. The cost of doing it is the inhibiting factor. Today, when you want to compete globally, there is no value in it. The United States, our number one competitor, does not do it, and they're able to sell their meat worldwide. But I think if we want to be a leader, this is where the industry has to move forward and continue to move forward.
Does that answer your question?
Bloc
Claude Guimond Bloc Rimouski-Neigette—Témiscouata—Les Basques, QC
My next question is for Ms. Marchand.
In Quebec, there is quite a debate about mandatory traceability. We have discussed this issue here within our committee with representatives from western Canada. The Americans are talking about voluntary labelling.
What is your opinion on the difference between mandatory traceability and voluntary traceability?
Executive Director, Agri-Traçabilité Québec Inc.
Well, I will be speaking to my own interests here. In Quebec, we decided to set up a mandatory system because the morning a health crisis erupts, we need to have all the information within an extremely short period of time. When we took the decision in Quebec to establish the current system, we didn't try to reinvent the wheel. When we first began discussing this issue in 1998, there had been many crises in Europe, if you remember, such as mad cow disease, foot and mouth disease and swine fever.
We organized a number of technical visits, during which we had the opportunity to meet with veterinarians and epidemiologists who had worked on these diseases and had tried to minimize their impact with the little information that they had. Once we had returned back home, they recommended to us that if we wanted to establish an efficient and effective system that would allow us to minimize the impact of such diseases and respond quickly, we should establish a mandatory system. We realize that this is a very tough requirement, but the morning that a crisis breaks out, the borders will be closed extremely quickly, and then it will be up to us to demonstrate that we can deal with the crisis. But if we don't have all the information we need, forget about it. And massive amounts of money will have to be spent to re-open these borders.
Bloc
Guy André Bloc Berthier—Maskinongé, QC
My question is for Ms. Marchand and Mr. Read.
The traceability system established in Quebec is important if we want to minimize to some extent the impact of a health crisis on both human and animal health. However, this system is very expensive. I realize that Colbex has had its fair share of difficulties in recent years.
How do you perceive the costs of these measures to ensure greater food safety for our fellow citizens? How do you see the federal government playing a role to minimize these costs and provide greater support to the industry?
Executive Director, Agri-Traçabilité Québec Inc.
A traceability system does indeed have a cost, but that cost is negligible compared to the cost of a crisis.
We often insure our houses against fire, when there may never be a fire. Yet we will have paid insurance premiums all our lives because we feel we have an obligation to protect our property. The purpose of the traceability system is to protect human and animal health, but we must never forget that a traceability system makes it possible for us to add information and provide added-value that protect our markets, and may help us develop other markets.
When we received the group of veterinarians from Japan who came to audit the Quebec system, Quebec exporters had an opportunity to access other markets, because information was available from a third party, and the information the exporters needed could be confirmed.
With regard to the federal government's role, in times of crisis the federal government is the first entity called upon to advocate our issues and show that we're there. In my view, this should be shared among the federal government, provincial government and industry, and we need to ensure that throughout Canada we have similar systems that meet international requirements and protect our consumers within our borders.
General Manager, Levinoff-Colbex S.E.C.
Again, coming back to the cost factor on this, we know what it costs if the border closes. But if you looked at it as a self-insurance program, then maybe you'd be going down the right road. The big thing that we would expect from people in this room is to go to our number one customer base, the globe, and get them to agree that, yes, if you do run into trouble, we will accept that; we guarantee that the border won't close if you can demonstrate control.
We have what we call a zoning thing in this country. An example is West Hawk Lake. I think you've heard about that one. But there's no guarantee the border will stay open even with that. It's based on emotion and the will of the day.
We try to bring science into our business. Please don't take any of this the wrong way. I believe in a democratic society, believe me, but politics can sometimes override science, and industry pays, whether it's livestock or manufacturing. So we need to negotiate with our trading partners, say this is what we can do, this is what we do do--ATQ, CCIA are one aspect, zoning our country. Will our trade partners accept that? What does it mean to industry? If we can prove value in it by the border, if we do have.... Let's use the avian influenza. The Americans did accept that it was zoned in southern B.C. They had trouble with the bags of chickens, but they did accept it; the borders weren't closed. China backed off for a while, but it was a short-term thing. But it was based on emotion and the need of the day. They could have just as easily said, “Call us tomorrow.”
That's what we need to do. We need to identify value in the process, and then you'll get everybody engaged--and that's work, communication, and the value in it. I would agree that we should look at it as a self-insurance program. Industry would be more than willing to work with this group or a selected group to move that forward.
Conservative
NDP
Peter Julian NDP Burnaby—New Westminster, BC
Thank you, Mr. Chairman.
What you are telling us is very interesting.
Ms. Marchand, in looking over the activity report, I saw no mention of exact costs. I know that Mr. Richardson and Mr. Guimond have both put some questions on the issue. I would like to know the amount that producers and the government were initially required to generate in order to implement a traceability system, and then what amounts producers and the government pay each year.
Executive Director, Agri-Traçabilité Québec Inc.
Here, we're talking about implementing the system. That includes developing the data base, providing assistance to all sectors in the agrifood chain in order to automate and transfer information, placing initial identifiers on all dairy cattle and beef cattle herds in Quebec, implementing four years of management and setting up a government inspection system. To cover all that, we received $21.5 million over four years.
Now, producers are essentially required to pay for the work involved in declaration, the information they are required to transfer to ATQ. This really is their time. Moreover, they are required to cover the cost of identifiers. In Quebec, to reduce the cost of our identifiers, we have decided to work through calls for tender, and to select a single supplier for a three- to five-year contract. That's because our volume is not very high, and we provide the identifiers at cost price, at no profit to ourselves.
To cover management of the data base, the Government of Quebec provides $3.4 to $3.6 million each year. For the data base, each hour I transfer a copy of all my information into the government's crisis management system. That information can be used in real time if there were ever a crisis in the following hour. This applies to the entire system, including the disaster security system, all computer infrastructure, all support personnel in the industry, and all pilot projects. When we are given a mandate to incorporate a new species, a pilot project is set up in cooperation with the entire sector, from the production stage to the slaughtering stage. Thus, when products become available on the market, we can be assured that all regulations in force have been complied with by everyone.
NDP
Peter Julian NDP Burnaby—New Westminster, BC
I see.
What sort of export and sale figures are we talking about here?
Executive Director, Agri-Traçabilité Québec Inc.
In the hog industry, in which I worked for twelve years, over 55 per cent of the annual production was exported. That amounted to over 7 million hogs a year. In Quebec, the focus is more on dairy than beef.
The export of beef in Quebec represents--
General Manager, Levinoff-Colbex S.E.C.
Of our production, about 40% is exported. But prior to mad cow, we were into Japan and all over the world with it, and ATQ was a big part of our support agency. As you can see, they put on a great presentation that the world really admired. There is no doubt about it.
NDP
Peter Julian NDP Burnaby—New Westminster, BC
I am trying to determine what the administrative costs of this system are in comparison with the sale figures, and, by extrapolation, to see how much it might cost to establish a national traceability system.
Executive Director, Agri-Traçabilité Québec Inc.
I can tell you that the system management costs have remained more or less the same each year, because the goal was to become automated—that is, to receive computerized information automatically by Internet or satellite. The goal is not for us to make the team twice the size it is. That is why we are going species by species. The more operations our system processes, the less costly it will be. This is why we are investing a great deal of effort in it.
NDP
Peter Julian NDP Burnaby—New Westminster, BC
You have a very small team, but it appears to be very efficient.
NDP
Peter Julian NDP Burnaby—New Westminster, BC
Do you not have some idea of what a system of this kind might cost if it was established nationally?
Executive Director, Agri-Traçabilité Québec Inc.
That depends on how the system is set up. Would there be a different system for each province? Would Canada be separated into two or three parts? At present, we do offer Canada-wide services for other species. We have signed the first-phase agreement with the Canadian Pork Council, and this should make it possible for all Canadian pork producers to work with Agri-Traçabilité Québec.