International Trade Committee on May 3rd, 2018

[David Adams]

Yes, I think that would certainly be more of an opportunity for Canada, for sure, if existing automakers weren't there.

Having said that, every production facility doesn't make a range of vehicles. Each one might make one or two models, so there's always an opportunity to export, say, a model that isn't being made by a certain manufacturer, even if that manufacturer is in that jurisdiction.

Obviously from my perspective I think if there were no automakers producing there, that would be a much bigger opportunity for Canada.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

Thank you very much.

[The Acting Chair, Liberal, Kyle Peterson]

Thank you very much.

Madam Ludwig, you have five minutes, please.

[Karen Ludwig, Liberal, New Brunswick Southwest, NB]

Thank you.

Good morning.

Also good morning to the students and teachers in the back. Welcome to Parliament. I would encourage you to come here as often as you can. Not only do we need more women in trade, we need more women in politics. There's a line that I particularly like to use. You cannot be what you cannot see. I think it's really important that you see women around this table who are representing our areas of the country, and certainly have important roles here in Parliament.

I am going to direct my first question to the canola industry. We have heard about the transportation challenges, but we've also heard about the challenges regarding labour in the agricultural sector. We heard about the need for further investment in innovation in the Canadian economy.

How do you see that playing forward, with an increased opportunity for further global markets in the canola industry?

[Brian Innes]

Yes, absolutely, there is huge opportunity for more innovation in our sector. We have expanded what we grow, based on the demand for healthy oil, and we feed our protein to livestock such as dairy cows and fish, but we see a huge opportunity in the future to take the protein in the canola and be able to transform it in a way that we as humans can have that as a source of plant-based protein for our diets.

When we look at what we produce in Canada, Canada is a global leader in canola. Seventy percent of all the canola traded in the world comes from Canada, and we have a huge opportunity to have some made-in-Canada innovation to take the protein that is currently in canola and make it into a form that can be a plant-based protein for humans in Canada and North America and around the world.

The protein industries supercluster we see as an opportunity to help us commercialize that, not just for canola, but for other prairie crops, like pulses, for example. There are incredible opportunities to take what we're doing really well and add more value to it and provide an opportunity for more plant-based protein around the world.

[Karen Ludwig, Liberal, New Brunswick Southwest, NB]

Thank you.

Certainly with my constituency youth councils—I'm going to tie this in to the students in the back—one of the areas of concern has been climate change. I represent the riding of New Brunswick Southwest, and we are under serious flooding. It's the worst situation we've had in 50 years.

In terms of climate change for the agricultural sector in the west, what impacts have you seen, and what mitigating opportunities do you see?

[Brian Innes]

Farmers are directly in touch with nature. Right now they're looking to get out on the land, to be able to seed this year's crop, and hopefully get good weather to harvest it as well. They're very in tune with both the weather and the changing climate around them.

What we've done in agriculture over the last 10 to 20 years is transform how we grow our crops in Canada. We grow them in western Canada without tilling the soil, and that means we're able to conserve more water, conserve the soil, reduce greenhouse gas emissions, as well as reduce fuel consumption. We're adapting to the changing world by growing our crops differently, and we're using technology to help us do that.

For example, zero tillage requires us to have the best crop protection products to take care of the weeds, because we're not tilling the soil to kill the weeds. We're keeping the carbon in the soil but we need to be able to control the weeds at the same time. When we look at Canada's place in the world, it's about making sure that trade is governed by science-based regulations, and that means that we do that in trade agreements, and we ensure that our regulators, the people who are the scientists, have the ability to help us solve challenges that come up with regulations that differ from one country to another.

[Karen Ludwig, Liberal, New Brunswick Southwest, NB]

Thank you.

Taking that a little further, Mr. Innes, there have been concerns about the burning of the Brazilian rainforests over the last 20 to 30 years, and the opportunities they would have given us for new penicillins, new types of research in medicine.

Having Canada involved internationally, what role do you think Canada could play, let's say in Brazil through a trade agreement, in maybe having some input in the area of science and others, in, for example, the Brazilian rainforest?

[Brian Innes]

That's a very good question. I don't profess to being an expert on the Brazilian rainforest, but I do know that in our experience in trade, when we have expanded our productivity and our ability to trade, that has actually led to better environmental outcomes here in Canada. There are provisions around the environment in trade agreements. When we look at the opportunity through trade, we see that as an opportunity to also increase our sustainability.

For example, we've increased our productivity in Canada by growing crops on land we didn't grow crops on before. We used to summer fallow it or leave it open in the summer to try to take care of the weeds, which meant the soil dried out and blew away in some circumstances.

When we look at the increased productivity we've had in Canada, which has led to us trading more in agriculture, we've done that at the same time as we've really improved our environmental outcomes. There are opportunities in trade to do both.

[Karen Ludwig, Liberal, New Brunswick Southwest, NB]

Great. Thank you.

That's all my time.

[The Acting Chair, Liberal, Kyle Peterson]

We'll go now to Mr. Hoback for five minutes, plus 20 seconds that Mr. Carrie didn't use.

[Randy Hoback, Conservative, Prince Albert, SK]

Thank you, witnesses, for being here this morning.

Again, welcome to the students who are here. I hope you come back. This is a good committee. It's actually one of the committees that functions fairly well. We work together. We do get political and partisan once in a while, but that's usually very rare. Mind you, I will get a little partisan right now.

[Karen Ludwig, Liberal, New Brunswick Southwest, NB]

We get along.

[Randy Hoback, Conservative, Prince Albert, SK]

Mr. Innes, you talked about the TPP and the importance of ratifying that. I agree with you. We've been saying that, and I think most of the committee members here are just actually waiting for it to come into the House so we can put it through this committee. In fact, as an update for you, I think we do have some free meeting time available in June, so hopefully if we see it come through the House anytime soon, we'll have time in the committee to put it through. We're actually going to do a pre-study on the changes in TPP so we can focus on that.

We've already studied the original agreement fairly extensively. We just want to know what's different. The committee will be excited to get on to that once we finish some of the studies here and see that our House leaders actually get it into the House and through. Hopefully that will be done sooner rather than later.

I'm really glad to hear you talk about no-till and minimum till. To put it in perspective, my colleagues, if you'd gone out to the farms in Saskatchewan in the 1980s, if you had a dry season, you wouldn't have a crop. It would blow away. We can remember scenes of the dirty thirties, things blowing and blowing, and dust everywhere.

Now, if you can get four or five inches of rain, you have a crop; and if you get 10 inches of rain, you have a bumper crop. That's showing up in our canola yields for sure. That's why we need market access, because they are taking care of the land, sequestering carbon, and doing a way better job than our parents and grandparents did, just because they have better technology to do it with.

If you could take that technology, such as MacDon and Case New Holland produce, and ship it to Argentina and Brazil, they can do the same thing, then, too. It actually does create a better global footprint from carbon sequestration.

The canola sector has a very ambitious game plan to not just increase acres, but increase volumes, but there are some challenges. We heard some challenges here in previous testimony about getting product to market. Maybe you could just talk about some of the challenges that you think we still need to overcome domestically before we start really going after things such as Mercosur.

[Brian Innes]

When we look at our strategic plan for the industry, we're looking to have stable and open trade. In terms of the mandate of this committee, we're looking to improve productivity through sustainable production and we're looking at making sure we maximize the value of what we produce. Internally, here in Canada, there are many things that the industry is doing for the three pillars of the stool, and government also has a role when it comes to things such as infrastructure and the transportation system we have for rail. I'll repeat that Bill C-49 is an incredible move forward to help us have better rail service, and we hope that bill passes as soon as possible.

When we look at other things that help us grow, as well as barriers that we see here in Canada, it has to do with the limited regulatory capacity we have to enable our exports globally. We need our scientists to be able to work with other scientists in other countries. That means that regulatory agencies such as the Canadian Food Inspection Agency and the Pest Management Regulatory Agency need to have the mandate and the resources to be able to have science-based rules that help us to trade.

Those are some of the main ones we face. Certainly when we look at how we adapt to climate change, we need to do so in a way that maintains our competitiveness as well. Our industry is working very collaboratively with jurisdictions to get frameworks in place that help our processing plants and our growers do that.

[Randy Hoback, Conservative, Prince Albert, SK]

If there's one thing that really frustrates Saskatchewan farmers right now it's that they have been sequestering carbon for years and nobody is willing to give them credit for it. Then they want to throw on a carbon tax, which is actually going to increase our farmers' costs and make them uncompetitive in the global marketplace because countries they compete against don't necessarily have the same costs of the carbon taxes and things such as that, which we're putting on here in Canada. It's concerning.

Now, you talked about Bill C-49. I assume you're talking about the bill with the amendments that were made in the Senate. I assume that all those farm groups are basically saying they needed the amendments to actually make Bill C-49 work for them moving forward. Do you not agree?

[Brian Innes]

This is not something the Canola Council takes a position on, but my understanding of our members—the growers, the processors, and exporters—is that they would like the amended agreement to pass as quickly as possible.

[Randy Hoback, Conservative, Prince Albert, SK]

Yes, they'd like to see it as urgently as possible.

You talked about the possibility of opening the market for canola oil in Brazil. Actually, I think there is some potential. They like to fry a lot of foods and to have a healthier oil, just like you would like to see healthier oils in the Asia-Pacific market—over palm oil, for example.

There are some opportunities there. What would you need from the government to seize those opportunities? What would that have to look like for you to really take advantage of them? What needs to be in that agreement?

[Brian Innes]

First, we need to eliminate the tariffs.

[Randy Hoback, Conservative, Prince Albert, SK]

Do you mean the 10%?

[Brian Innes]

That would help. A 10% tariff may not seem like a lot compared to other sectors, but in a sector like canola, that's very high, especially when they are major oilseed producers themselves. Getting rid of the tariffs is number one.

Second would be ensuring that we have a commitment to science-based rules around how we regulate plant, animal, and human health, through sanitary and phytosanitary measures. A commitment to that is incredibly important. We've seen in other countries, whether in Europe or elsewhere, that these regulations can be misused and really block our exports.

[Randy Hoback, Conservative, Prince Albert, SK]

China, for example.

[Brian Innes]

China as well.

Third, I would say that when it comes to plant breeding innovation, we need to have language in there that supports our innovative sector here in Canada to bring new plant breeding innovation to market and to trade that back and forth between countries.

[Randy Hoback, Conservative, Prince Albert, SK]

Maybe I'll stop there.

[The Acting Chair, Liberal, Kyle Peterson]

Thank you, Mr. Hoback. You did use the extra time, so that's good. I'm glad you put it to good use.

We're going to go to our final questioner, Mr. Fonseca. Then, with the support of the committee, perhaps we'll adjourn a few minutes early—five minutes earlier than normal—just to give the students some interaction with some of the members of Parliament here for those five minutes. That will be, of course, off the record. We'll adjourn before that. If everybody is in agreement with that, we'll follow along those lines.