Evidence of meeting #34 for International Trade in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was beef.
A recording is available from Parliament.
NDP
Don Davies NDP Vancouver Kingsway, BC
Thanks, Mr. Chairman.
I'm wondering about the reverse now. Of course we all want to see our producers ship more product to Japan. Do you foresee increased competition with Canadian industries as a result of the increased trade with Japan? Are there Japanese producers who are going to be competing with us in any way, in your industry or elsewhere?
Director, Government and International Relations, Canadian Cattlemen's Association
It's not something we're concerned about.
Japan has a special breed of cattle known as wagyu. Some people have heard of kobe beef. It's a breed of cattle that produces beef that is very highly marbled. When you see it, it's almost white. It's like eating butter. It's very delicious, but it's very, very, expensive. I would expect that we may see some additional wagyu Japanese beef coming into Canada, but it doesn't compete on a price point. I wouldn't say that we're overly concerned about that.
Conservative
Conservative
Ed Holder Conservative London West, ON
Thank you, Mr. Chair.
I thank our guests for attending today. With this schedule, it's been a little bit curious.
I've heard comments about South Korea, both from our guests and from members opposite. I want to remind us that we're talking about Japan. We certainly understand the importance of Korea. That's not lost on us. But I don't want us to lose focus of what we're dealing with as we deal with these things. Respectfully, I hear what you say, and it goes without saying that we take that issue very seriously.
I have a few questions. I'm going to start with the issue of trade. We're at the very beginning of this discussion about trade. A couple of days ago we had some background information as it relates to our trading with Japan. This is a really unique opportunity, I think, at this stage of the discussion, in that if we were to have any greater influence with our trade negotiators, it would be today. It would be now.
Mr. Masswohl, you mentioned that one of the first things you would like to see is an increase in the age from 21 months to 30 months. If you had a wish list, concisely, very specifically, what would you like to see? I'll ask both sides, both beef and pork, please. If you could wave that wand and say that these are the two or three things we absolutely need to increase export to Japan, what would those things be, please? You mentioned one already.
Director, Government and International Relations, Canadian Cattlemen's Association
Right.
On the age limit, that doesn't even have to wait for an agreement. We think that there's a good process in place, and it could happen before we have this agreement.
Director, Government and International Relations, Canadian Cattlemen's Association
I would wave my wand and eliminate that tariff.
Director, Government and International Relations, Canadian Cattlemen's Association
The 38.5%, and the threat of it going up to 50% from time to time, if you're successful in the market.
Conservative
President, Canada Pork International
Because of the nature, which is very different, my wish would be to find a way to modify the gate-price system to benefit Canada at the expense of our competitors and to be exempted from the safeguards.
Conservative
Chair of the Board of Directors, Canadian Pork Council
Yes.
First, we have to agree to work from the same starting point and then add what Jacques has just talked about.
It is extremely important that Canada be the first to sign a free trade agreement with Japan. That's the starting point. Efforts have already been undertaken in that regard, as well as for other markets. Certainly, Japan has requirements, but it pays more. For us, the producers, if the Japanese market has a certain requirement, but it is ready to pay for it, we are willing to step up to the plate. This is why Japan is important. It is the most profitable and the most demanding market. I want us to understand the difference.
It's all very well and good to have a market for a product, but if that market does not pay, there is no point providing the product. This is what sets the Japanese market apart. In other areas of the Asian market, we can sell other parts of the animal, such as in Korea or China, for example. We have not talked about China, but I am just giving it as an example so you can understand. There are different cuts of pork, and if they are all quality cuts, you get a better price, and therefore higher revenues. At the end of the day, we don't need government help. Do you understand?
Producers want neither government support nor subsidies. They want a market that pays. But until the market pays, it's obvious that we need help, just as other countries help their own producers.
Conservative
Ed Holder Conservative London West, ON
You've found an easy way to bring South Korea back into it, among others as well. I guess the question it would compel me to ask, then, is on that point. You know we're looking at the Trans-Pacific Partnership as well as a next step beyond. In your view, what does getting Japan locked up in terms of a free trade agreement do in terms of our ability to go forward to assist your industry with the TPP?
Director, Government and International Relations, Canadian Cattlemen's Association
There are a couple of things. First of all, we're not actually in the TPP, which is a problem.
Director, Government and International Relations, Canadian Cattlemen's Association
If we could wave that wand and get in the TPP, then that would be very beneficial for us and we could address it from that perspective.
The next point is that whether Canada is in the TPP or not, I think at this point there's no guarantee that there will be a TPP agreement. There may or may not be an agreement.
Going forward on a bilateral Canada-Japan agreement I think is an insurance policy against the TPP. If there is no TPP, at least let's move forward and have a Canada-Japan agreement. If there is a TPP that does not involve Canada, it's also an insurance policy that we don't fall behind. We can have our own free trade agreement with Japan and not be stuck at a 38.5% tariff while the Americans and Australia go down to zero.
NDP
Jasbir Sandhu NDP Surrey North, BC
Thank you.
I also want to follow up on the safety of the products aspect. You talked about the Japanese consumers demanding a very, very high level of safety for food products they import and that it's had an influence on how we manufacture or package our goods.
We talked about Canadian quality assurance programs. Can you tell me when that was developed and what sorts of steps were taken to meet the requirements of the Japanese market?
President, Canada Pork International
The quality assurance program was developed about ten years ago, and it was basically developed to address Japanese demands. They raised a lot of issues. The producers at the Canada Pork Council looked at all the demands and said they needed to provide some kind of quality assurance program to reassure their Japanese customers, and you should see the book the producers now have to comply with.
Nearly all the producers now are members of CQA, so it had a major influence in that sense.
NDP
Jasbir Sandhu NDP Surrey North, BC
The industry has embraced this program to produce quality products throughout the country.
NDP
Jasbir Sandhu NDP Surrey North, BC
Those are the products that are exported. What about the domestic products we use, local consumption? Are those products also put through the same quality assurance?
President, Canada Pork International
Yes. There's no difference. The only difference you have is on the commercial specifications. The Japanese buyer might request that the loin or tenderloin be cut in a different manner, or they could request a special breed.
When it comes to food quality, food safety, there's no difference between what we ship to Japan and what you eat here in Canada.
NDP
Jasbir Sandhu NDP Surrey North, BC
That's good to hear.
Who are our main competitors in both industries with regard to pork and beef when we're exporting to other countries?
