Good morning, Mr. Chairman and committee members.
My name is Jim Gowland. I'm a cash-crop producer from Bruce County near Walkerton, Ontario. For well over 30 years I have farmed with my spouse Judy, my corporate business partner. We currently produce approximately 2,200 acres of field crops, including soybeans, wheat, corn, and white beans.
Similar to other Canadian producers, our farm maintains a sustainable crop rotation that maximizes yield and quality attributes, cost-effective utilization of equipment capital, and sophisticated technology practices that ultimately result in our long-term business profitability.
Our farm business success can be attributed to taking advantage of opportunities that add value in the above-mentioned crops we produce. For my presentation today, I will focus on the crop of soybeans, which is our farm's largest and most value-added crop.
For the purposes of this hearing on the EU, approximately 60% of our 900 to 1,000 acres annually of non-genetically-modified, non-GMO, and identity preserved, IP--the other IP in the world--soybeans enter the European Union market.
I also have been privileged to have been previously involved externally, off our farm, in provincial soybean organizations and was also the founder of a national soybean organization. Those organizational responsibilities allowed me to be part of numerous national and international market development and trade experiences over a decade.
Specifically to our farm, and under proper management and segregation practices, the added value generated to our operation for 900 acres of non-GM and IP soybeans is well in excess of $60,000 to $70,000 of increased returns annually.
In comparison to regular crushed-commodity soybeans, the above amount would reflect an increased per acre value of approximately 15% to 20%. We consider this premium as a return on management and investment.
When I evaluate the importance of the EU market in our farm operation, the gross farm gate amount with premium included would represent approximately $300,000 annually. The balance of our value-added soybean production finds its way into Japan and Asia.
Within the Canadian soybean industry as a whole, the importance and impact of the EU market is a tremendous success story, as soybeans are the top export commodity from Canada.
As reported in Government of Canada 2010 statistics, Canada produced approximately 4.34 million metric tonnes of soybeans in 2010, with over 2.6 million tonnes exported from Canada. That represents 60% of Canadian soybean production. Of significance is that the EU imported 1.173 million metric tonnes of the above 2.6 million metric tonnes, or more than 44% of Canadian soybean exports.
As a dollar amount, EU soybean imports represent $575 million of revenues to the Canadian soybean industry.
It's very difficult to quantify and qualify the value-added or premium component for Canadian soybean producers, but it could easily represent an industry aggregate of at least $50 million annually for producers.
In addition, with the high demand for Canadian high-quality soybeans by export markets and a strong Canadian domestic demand for soybeans for crushing into meal and oil, strong domestic cash-basis levels are also improved, which is another very good monetary benefit for Canadian soybean producers.
Although the EU is a Canadian success story for soybeans, the EU is a very competitive and strict marketplace with stringent regulations. I believe that Canada has turned and can continue to turn the regulatory requirements of the EU market into more opportunities.
That being said, the Canadian grains and oilseeds industry and the Canadian government must continue to work hard together in trade negotiations with the EU and specifically with non-tariff trade barriers such as manageable low-level presence policies. It is equally important to develop low-level presence guidelines here in Canada.
As a Canadian producer, I commend all those for the positive outcomes to date of these Canada-EU negotiations.
Most certainly, I thank you for the privilege to present today. Thank you.