Evidence of meeting #6 for International Trade in the 41st Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was industry.
A recording is available from Parliament.
10:10 a.m.
Conservative
10:10 a.m.
Vice-President, Dairy Farmers of Canada
Just off the top of my head, in Ontario, since 2000, so over the last—
10:10 a.m.
Conservative
10:10 a.m.
Vice-President, Dairy Farmers of Canada
I'm not sure I have the numbers for Canada.
10:10 a.m.
Director, International Trade, Dairy Farmers of Canada
I don't have the exact numbers.
10:10 a.m.
Vice-President, Dairy Farmers of Canada
Ontario's pretty representative of the country. Since 2000 we've had about 10% more quota issued. That's been growth in the market over 13 years, so that's a growth rate of about 0.7% to 0.8% per year. That's not just cheese, that's all milk product.
10:10 a.m.
Conservative
Devinder Shory Conservative Calgary Northeast, AB
Another interesting fact I read somewhere is that 223,571 cows were slaughtered in Canada in 2012. Nearly 100% of the cows raised for veal in Canada are dairy calves. With more than 24,000 tonnes of veal, we'll be ready for an eager European market that is willing to pay more than $10,000 per tonne. Dairy farmers stand to benefit financially from access to this profitable and hungry European market. How can dairy farmers be opposed to access to this market? And how will this impact negatively? I'm trying to understand.
10:15 a.m.
Vice-President, Dairy Farmers of Canada
I don't think we've ever said we were opposed to greater access for Canadian meats to the European market.
The other thing to remember, too, is that the subsidies they have in the EU for farmers are not limited to dairy farmers. These are programs that are decoupled from production, so they apply to all farm production.
10:15 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
Thank you, Mr. Chairman.
My thanks to the witnesses for joining us.
I have two quick questions for you, Mr. Leduc.
First, you represent dairy producers, but your presentation dealt more with cheese producers. Are they the same or are they two separate types of producers?
10:15 a.m.
Director, International Trade, Dairy Farmers of Canada
The point we are trying to make is that the impact will be felt by both primary producers and cheese producers. Imported cheeses will directly compete with the cheeses produced by Canadian cheese makers. We expect fine cheeses to be competing directly with Canada’s fine products, particularly in the eastern part of the country, but—
10:15 a.m.
Liberal
10:15 a.m.
Director, International Trade, Dairy Farmers of Canada
We are responsible for generic promotion in Canada, meaning not only the promotion of milk, but also the promotion of dairy products, such as cheese, yogurt and butter. So the investments made by producers also benefit Canadian cheese makers.
10:15 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
In your brief, you were saying that you have invested $30 million in the promotion of cheese across Canada.
10:15 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
If we were to invest another $30 million or $50 million, any amount you like, to promote those products in Europe, would that help sell Canadian cheese in Europe?
10:15 a.m.
Director, International Trade, Dairy Farmers of Canada
We are dealing with technical obstacles in exporting the products, as I tried to demonstrate. Right now, under the constraints of the existing system, Canadian cheeses produced with milk at a lower price than the price on the domestic market will be considered subsidized under the World Trade Organization agreements. As a result, right off the bat, there is a major obstacle to entering that market.
In terms of fine cheeses, some of them could actually be exported to the European market, since they are produced at the same price as that of the Canadian market. That is already the case for the export of fine cheeses to the American market.
10:15 a.m.
Liberal
10:15 a.m.
Director, International Trade, Dairy Farmers of Canada
Yes, it is minimal. We are talking about less than 1,000 tonnes a year right now.
10:15 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
So it all comes down to cost. It has nothing to do with the type of promotion and advertising being done. It is based on price.
I have another question. You said that the processing costs are high in Canada. Does processing include the price of the primary product or is it just the processing cost?
10:15 a.m.
Director, International Trade, Dairy Farmers of Canada
One of the tables in our presentation clearly showed that the price paid at the farm is significantly higher in Canada than it is in the European Union. In addition, the price is free from all subsidies.
10:15 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
That is because of the primary product, because of milk, correct?
10:15 a.m.
Director, International Trade, Dairy Farmers of Canada
Among other things, it is because of the price paid at the farm, but also because of the processing margins that are twice as high as they are in Europe, based on the information I have. It is not only at the primary production stage, but also at the processing stage.
10:15 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
Thank you.
Mr. Masswohl, just quickly, you started your presentation by saying no transatlantic trade has been undertaken in your industry for years. So the tariffs are going to come down, some of the regulations and rules are going to change. What else is going to change so that all of a sudden we're going to have the ability to export to the European market?
