Evidence of meeting #144 for International Trade in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was crop.
A recording is available from Parliament.
4:10 p.m.
Liberal
The Chair Liberal Mark Eyking
I'm sorry, Mr. Dhaliwal, I'll have to leave that as a statement because your time is up. We have to finish this round and go to the second round. The Liberals have the lead-off on this round.
Mr. Sheehan, you have the floor.
4:10 p.m.
Liberal
Terry Sheehan Liberal Sault Ste. Marie, ON
Thank you very much. I'll pick up where Jean-Marc made the comment.
I mentioned this last week when we had the ministers here with some officials. We know that Canada is exporting $2.7 billion—I think that was the number you used—to China. Canada is also exporting to other markets, the second-largest being the Japanese market. I'm co-chair of Canada-Japan Inter-Parliamentary Group, and I know how seriously they take everything as it relates to being an island nation, about protecting themselves, about being extra-cautious and making everything science-related, whether it's admitting people or food products in various forms.
The Japanese market, I believe, is well over $100 billion. I'll throw in Mexico, too, because I think Mexico is our third-largest market at around $700 million or $800 million. Have they indicated any issue with Canadian canola to you or to anybody around the table at the same time that the Chinese were doing this?
4:10 p.m.
Senior Vice-President, Corporate Affairs and General Counsel, Richardson International Limited
No.
4:10 p.m.
Liberal
Terry Sheehan Liberal Sault Ste. Marie, ON
Did anybody else get any kind of indicator, for the record?
4:10 p.m.
Liberal
4:10 p.m.
President and Chief Executive Officer, Viterra
There've been no issues from any other markets.
4:10 p.m.
Liberal
Terry Sheehan Liberal Sault Ste. Marie, ON
Thank you. It's important to get this on record. I appreciate that everyone's on board with the science-based approach. I think the working group is an excellent idea, with members here today exploring various avenues.
You mentioned what you couldn't say as a result of the meeting. What would you anticipate in future meetings. What would you like to see discussed at future meetings, Jean-Marc?
4:10 p.m.
Senior Vice-President, Corporate Affairs and General Counsel, Richardson International Limited
If the working group is to fulfill its stated mandate, as I understand it from the simple name of the committee—the strategic working group—I think the discussion will be about sharing and getting the input of industry on a strategy for moving forward. We'll need to understand where we are on the technical side of things. After that, we'll need a game plan if and when we get to a point where we've confirmed that there are no legitimate quality issues at play, such as market diversification, finding other markets or opportunities for other actions to be taken.
We've only had one meeting to date, and it was very preliminary, but what I would like to see coming out of the group is a way to help industry understand what is going on so that we get some comfort that there is, in fact, a plan to deal with this issue in the long term, as well as an opportunity for us to provide some input into the elaboration of that plan.
4:15 p.m.
Liberal
4:15 p.m.
President and Chief Executive Officer, Viterra
I think a key part is working with the rest of the group to stress the urgency of this matter. As we said earlier, there is a huge sense of urgency here. This is something that is affecting not just producers but the entire industry and the entire economy. For us, it's key that we as industry participants in this working group provide our perspective on the importance of the matter at hand and how it is affecting the entire canola trade.
4:15 p.m.
Liberal
Terry Sheehan Liberal Sault Ste. Marie, ON
I was surprised that during question period today there weren't any questions asked about the canola issue, given that it was so important.
I agree with you, and I hope this will be raised.
4:15 p.m.
Liberal
Terry Sheehan Liberal Sault Ste. Marie, ON
We also talked about the need for action as it relates to planting and growing canola—and that is an option. The farmers want to go forward with that process. Explain to me how long it takes to grow and then after that—I'm from northern Ontario, and we have farmers around in various places and I see the silos—tell me how long you can keep canola in storage.
4:15 p.m.
President, Canadian Canola Growers Association
I started in the fall, 2018. I'm making planting decisions starting last September, basically. I'm getting calls when I'm actually combining 2018's crop, or whatever year that happens to be. Right now it's 2018.
I'm making decisions on rotation, as I mentioned in my talk. There's rotation, insects, margins, input costs, all of that is thought about and considered.
By the end of the year I have, in large part, all of my canola seed. I pay for it, because that's the best price I can get. A large part of my crop nutrition is also bought and paid for. Once that's done, it's very difficult to take seed back.
Basically, by the end of December 2018, I was committed to my acres for the spring of 2019. Crop input retail will take a bag or two back. They don't want 78 bags back from me right now. I'm really committed to what I had for plans already, based on the fall of 2018.
I grow the crop and I'm harvesting again in September and October. In 2019 I can certainly store it. On our farm we usually try to market from fall through to the next July. I like to have my bins emptied out again by July so that I have room for next year's crop to come off again. I can't afford to have double the bin space. I try to cycle once a year.
That's not saying that I can't store longer than that with due diligence and making sure that there are no issues in the bin through storage. The summer heat can be an issue. You have to be a little more diligent, for sure.
It's not the way I'm set up, though. It's a fill-the-bins-once-a-year, empty-the-bins-once-a-year cycle. In large part my plans are set in stone, pretty well. I can make small adjustments by the end of the fall, or by the end of the previous year, for sure.
4:15 p.m.
Liberal
The Chair Liberal Mark Eyking
Thank you, sir.
That was a good question, but it should maybe have been asked at the first...but that's fine.
We have time for one more slot with MPs before we bring out more growers. We're going to the two visiting MPs, the dynamic duo from Manitoba.
Mr. Sopuck and Mr. Maguire, you have the floor.
4:15 p.m.
Conservative
Robert Sopuck Conservative Dauphin—Swan River—Neepawa, MB
I have one comment and one question, and then I'll turn it over to Mr. Barlow.
My comment is this: the head of the CFIA at our meeting last time pointed out that Canada and China use two different methods to test the quality of canola. That's an elephant in the room, in my view. That's going to be difficult.
Mr. Ruest, we've built up the relationship with China over 100 years. A lot of trade is built on the intangible factors of relationships and how that is done. Trust is built up. What China has done recently, does it destroy that trust? Even if they were to come back into the market, won't that engender a level of uncertainty that you never had before?
4:20 p.m.
Senior Vice-President, Corporate Affairs and General Counsel, Richardson International Limited
Things like this certainly put a chill on the market. I think the relationship that we have with our customers continues to be good. We have a good relationship with long-standing Chinese customers.
Our customers don't have quality concerns with our shipments—in the past, or with these that are at issue. It is an issue that is being raised by the Chinese government.
Certainly, we trade in an industry that requires predictability. As soon as you have market distortions of these types, you take away from that predictability, and this can't but have a negative impact on your outlook on the opportunities of the market.
4:20 p.m.
Conservative
4:20 p.m.
Conservative
John Barlow Conservative Foothills, AB
Thank you very much, Mr. Sopuck.
Mr. Sheehan, we've tried more than a dozen times to get unanimous consent for an emergency debate in the House on the canola crisis. Each and every time, the Liberals have turned us down. The Conservatives understand how important this issue is, but our colleagues don't seem to share our view on that, which is disappointing.
You talked about the difference between science-based procedures and the political issues at play here. I want to use an example of what we can do when we get things done. In 2018, we had samples of GMO wheat in Alberta. Japan took action and blocked Canadian wheat. We had a plan from the government at that time. It was acted upon and in less than a month we had that trade issue resolved. We're now more than a month into this crisis with no plan, no concrete action taken. I think this shows the difference between a science-based problem and a political problem that needs a political solution.
Jean-Marc, you mentioned the need to show some strength here. We're asking for a high-level delegation, including ministers, to go to China. Is that something you are hoping to see in the very near future?
4:20 p.m.
Senior Vice-President, Corporate Affairs and General Counsel, Richardson International Limited
Once we get to the point that we have absolutely ruled out the technical issues, then the matter becomes a political one to be resolved. Maybe there are issues that require high-level political discussions simply to avoid having the types of delays and disruptions that occur from a technical issue, if, in fact, it was put forward in good faith.
4:20 p.m.
Conservative
John Barlow Conservative Foothills, AB
You said that when your shipments left Canada, they were tested and everything was clean, and then they get to China. Do these ships stop anywhere between Vancouver and China? Can anything happen en route that would change the results of those tests?
4:20 p.m.
Senior Vice-President, Corporate Affairs and General Counsel, Richardson International Limited
No, we're very comfortable that the test results, the sampling at time of load, would have been representative of the quality of the cargos as they arrive at destination.
4:20 p.m.
Conservative
John Barlow Conservative Foothills, AB
Thank you.
Just very quickly to Bernie McClean, thank you very much for coming. You talked really quickly about storage. Even on the advance payments program, you still have to pay that back.
What would it cost you to increase your storage on your farm to try to store canola seed or the harvest if you're unable to sell it? What kind of money are we talking about if you had to double your bin size?
