International Trade Committee on April 21st, 2016

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

I can come back to another question, if you like.

Obviously we have a number of member countries in the TPP. What opportunities or threats do you see on the importing side from the member countries importing to Canada?

[Cam Dahl]

I don't see trade as a threat. Trade going both ways is a good opportunity. I'll use the U.S. as an example. The U.S. is both our biggest customer and supplier for cereal grains. We're their biggest customer, and that benefits both of us.

In truth, I do not see threats. I see the opening up of opportunities. I don't see a threat.

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

How do you see expanding a Canadian consumption of pulses? You mentioned that there's a significantly heavy reliance on trade. We know and understand the health benefits of pulses. How do we encourage more Canadians to consume pulses?

[François Labelle]

I think this year is a perfect year for that. We're gaining a tremendous amount of traction this year, as it's the International Year of Pulses.

We just need to get it out in front of consumers to understand the health benefits, the environmental benefits, and so on. It's interesting now that in just about every circle we travel and everywhere we go, people are talking about pulses. That's where we start gaining traction. We have to talk about them and get people to accept them. And they are.

[The Chair, Liberal, Mark Eyking]

Thank you very much.

That wraps up your time, Ms. Ludwig.

Mr. Fonseca, you have five minutes.

[Peter Fonseca, Liberal, Mississauga East—Cooksville, ON]

Thank you to all the panellists for your presentations. It's just been terrific on this western tour that we've been on to hear about all your success.

What I want to focus on is what Ms. Ludwig was talking about in terms of some of the non-tariff barriers that come about. You talked about levelling the playing field, which we think is great with the MRLs, and the opportunity to be able to do that through the trade agreement and through being at the table.

Some of the other places where we'd like to see a levelling of the playing field would be with labour standards, environmental standards, etc. Do you think that your industry at the table would be able to make that push? We heard about food safety and how you're going to be able to address that if you are able to be at the table with your counterparts from around the world, but how about with some of the other standards where, we've heard, we're playing on a different playing field?

[Patti Miller]

Certainly on the environmental standard component, as we touched on before, I think the Canadian industry has a lot of success we can share. Canola was one of the first crops in Canada to be certified as internationally sustainable for canola production in the European market. We are working with a lot of the different sustainability organizations to show them, and measure, how Canada stacks up against other grain canola seed producers around the world. As I've said, we have an amazing story to tell. I think environmentally, that footprint is very good.

As an industry, through a sustainability round table, we are also starting to work to quantify a lot of the other social aspects that come into sustainability measures like labour practices, health and safety, and that regulatory framework. We're starting those measurements, but I believe Canada has a good story to tell and can show leadership around the world in those areas.

[Cam Dahl]

I think one of the areas, not opening up the agreement.... One of the areas where Canada can have a role to play is in capacity building in some of the regulatory structures in member countries, to give member countries that ability to have that strong, rigorous scientific assessment. We have a very strong, good regulatory system, and I think Canada does have a role to play in helping build that capacity out to our trading partners.

[Peter Fonseca, Liberal, Mississauga East—Cooksville, ON]

Cam, I know you said that in terms of not opening up the agreement, but if the agreement were to be opened up, what changes would you advocate for? That's for you or any of the panellists.

[Cam Dahl]

From my perspective, I think the risks of opening up that agreement would far outweigh any potential benefits that I could think of. The risk of opening up an agreement that has taken this long to negotiate with this many members would be the end of the agreement. To me, that would be a risk that is too large to take.

[Peter Fonseca, Liberal, Mississauga East—Cooksville, ON]

We've heard from other witnesses that there are some challenges with some of the countries with currency manipulation.

Is that something you've looked into with the countries that are part of the TPP? Is that a concern? Is that something you would see as a risk?

[Patti Miller]

It's not something that we have looked into, but 60% of our canola exports go into the TPP bloc of countries, which are Japan, Mexico, U.S., Vietnam. We've been trading with those countries for years.

[Peter Fonseca, Liberal, Mississauga East—Cooksville, ON]

Those are some of the countries that come up that may manipulate their currencies to their competitive advantage, and that would be a challenge for some of the industries we've spoken with.

You don't feel that would be a concern of yours.

[Patti Miller]

Our industry has grown on the basis of exports to those countries.

[Peter Fonseca, Liberal, Mississauga East—Cooksville, ON]

Recently the minister was talking about how CETA is moving forward and how they've structured their trade agreement.

Do you think that it is a better structured agreement when it comes to dispute resolution?

[Cam Dahl]

Again, from my perspective, I would go back to the risks of opening up the agreement. To me, the risks are greater than any potential benefits.

[The Chair, Liberal, Mark Eyking]

Thanks very much.

We're going to move on to the Conservatives and Mr. Maguire for five minutes.

[Larry Maguire, Conservative, Brandon—Souris, MB]

Thank you, Mr. Chairman.

I would just like to say that my dad would be pretty proud, Patti, of the industry and how it has developed. He was one of the first 10 growers to grow what was called rapeseed in 1959 in Manitoba. When you're talking now of a $780-million increase in opportunity, that's tremendous for an industry and tremendous for our country, never mind the jobs you've indicated.

Speaking to my pulse friends, when I was growing pulses in the late 1980s I didn't know there were that few acres in the province as a whole, but when you consider that soybeans have been the third-largest crop in Manitoba for the last four years running, that's a tremendous change and opportunity. We need to have exports for those products.

With my experience in wheat, Mr. Dahl, and given the comments you've made about the potential increase in exports of wheat being 20%, can you—each of you—elaborate a little bit on.... From your presentation, Mr. Dahl, I gather there were a couple of things left at the end that you might want to elaborate on.

Could you each do that, please?

[Cam Dahl]

I think it's important to emphasize that there will be potential gains as well as potential losses. This is a region of the world that is not just growing in income but is growing in the middle class. It will have the largest percentage of middle class. If we leave the TPP region, the Pacific region, to our competitors and don't play in that game, it will be a disaster.

The flip side of that coin is true as well. The opportunities for growth are enormous. The opportunities for long-term, stable growth are enormous. That will bring investment in research, innovation, and development. That will bring investment throughout Canada in value-added processing, which brings jobs not just to our large cities but to our rural communities throughout the country.

[Patti Miller]

The reference to when your father started growing rapeseed is quite interesting. In the matter of basically 50 years, we've taken this crop, canola, from an idea to a multi-billion dollar industry, particularly the processing industry.

As Canadians, and particularly the agriculture industry, we've talked for years and years about needing more value-added processing in Canada. Canola has done that. Canola is an amazing example of value-added job creation. That $780 million additional a year largely stems from that processing industry.

As Cam has pointed out, we market canola oil based on the fact that it's a healthy oil. The TPP countries' growing middle class, when they have more money to spend, are more interested in the quality of their food and the impacts on their health. We see the opportunities there as phenomenal.

[François Labelle]

When you talk about the growth we've had in the soybean industry in Manitoba, as an example, for a couple of the TPP countries you look at, for instance Malaysia and Vietnam, we don't have great trade, but we were the first to start exporting food-type soybeans to Malaysia and Vietnam. In the last couple of years we've had tremendous competition from our neighbours to the south in that market, but we've still been able to retain a good percentage of that market.

If we do not ratify TPP, chances are we will lose all the efforts we've made in developing those markets, and there's potential for that to grow to substantial tonnage. It's been small, but that's just one prime example that if we look at it, we see there's tremendous growth potential for us, as well.

[Larry Maguire, Conservative, Brandon—Souris, MB]

Of course, the feeling is that then we have to sign the agreement, but we want to make sure that it's safe. I noticed that you've all talked about the science-based need for food rules, phytosanitary agreements, and that sort of thing.

The trade dispute settlement mechanisms that would be in this agreement are different from even those in the CETA and are much more modern, I believe. I could get you to expand on that, but I also noted that each of you has indicated in some way in your presentations today what would happen if we stall out and don't sign this agreement. It's not so much my first question, which was about what is the potential in the future, it's how bad could it be.

You've just indicated, François, I think, that if we stall out.... In my experience as a farm leader, if you stall out, you're living with the status quo and you're always going backwards, if that's where your target is. Could you expand on the lost opportunity? I think some of you have mentioned it.

[The Chair, Liberal, Mark Eyking]

I'm sorry, Mr. Maguire. They're going to have to be really quick, or your colleagues can finish up your question.

[Larry Maguire, Conservative, Brandon—Souris, MB]

I was done, Mr. Chair.

[The Chair, Liberal, Mark Eyking]

Thank you very much.

We only have about four minutes left. We're going to split the time, with two minutes for the Liberals and two minutes for the Conservatives.

We'll start off with Mr. Peterson for a two-minute question and wrap it up with Mr. Van Kesteren.