Evidence of meeting #33 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 pei.
Liberal
The Chair Liberal Mark Eyking
Before we move on, I have a question for the lobster people.
Out of P.E.I. and going to Asia, are most of your lobsters live lobsters? How do you ship them? Do you put them all in containers and take them to Halifax or Moncton? Do they fly direct? How do they get from here, technically, from your wharf to the tables in Asia?
Executive Director, Prince Edward Island Fishermen's Association
Our ratio has typically been 80% processed versus 20% live product. That's maybe changing a little bit in the last few years because more live storage is being added. That's certainly infrastructure that we need, to make our plants more efficient and also to give us more opportunities. Typically, the product is transported to Halifax. When Halifax is busy, it has to go all the way to Toronto, but Halifax is a primary market. It is done typically by 20-foot or 40-foot container loads, and they're obviously refrigerated to keep them frozen.
Liberal
The Chair Liberal Mark Eyking
Thank you.
We're going to move on. Madam Ludwig, I think you have the floor. Go ahead.
Liberal
Karen Ludwig Liberal New Brunswick Southwest, NB
Thank you very much for these excellent presentations.
I just want to go over quickly what I've heard this morning from the panel, starting with Mr. Donald, the need to diversify markets, looking at the value of the Growing Forward program, continued research in the area of potato production. Mr. MacPhee, one of the things that resonated with me was succession planning, which we had talked about in an earlier panel, and the need for youth to enter into this market. In the area of lobster production, it would be resources, the inability, responsible fishing, fair labour, enforcement of the owner-operator model, education, Japan, the higher value products, product modification possibly for lobster, if we're looking at infrastructure requirements. Mr. Eyking just asked if it was a 40-foot refrigerated container.
What resources do all of you access in P.E.I. to support trade? Are you accessing the trade commissioner service, the provincial services, Trade Team PEI? What are the ones that you find of great benefit? What are some of the opportunities for us to help support all of you in those areas for our programs?
General Manager, Prince Edward Island Potato Board
I guess I can start off. I would say all of the above, and we certainly do. On your list, I just want to point out at the start that I can't stress enough the importance of addressing phytosanitary-type issues—
Liberal
General Manager, Prince Edward Island Potato Board
—when it comes to potatoes, because it becomes very political. I heard you ask an excellent question earlier about non-tariff trade barriers. There are lots of opportunities for those with potatoes. So I can't stress enough the importance of adequate resources at the CFIA in the plant health division to address those.
As well, market access is very important, I would highlight. There are many countries where there are opportunities today. Again, quite frankly, we can deliver as good or better quality potatoes from P.E.I., from a plant health and quality perspective. Our major trading partners are doing business with these countries, significant business, that we should be doing business with as well. There needs to be more attention within the market access division to working through the issues around potatoes.
Liberal
Executive Director, Prince Edward Island Fishermen's Association
Certainly, we understand that version three of Growing Forward is currently under discussion. There is some discussion of a similar program, I believe, to include the seafood industry. We've kind of been left out of some of those programs in the past, and we would really encourage all parties to support that type of initiative. We have a great brand out there in terms of the Canadian brand, but we also have to back that up with proper promotion and marketing.
We're quite new to this. Certainly ACOA and the provincial support, Trade Team PEI, have been excellent in helping us, because we're on a steep learning curve, but there have been great support mechanisms. I know that Mr. King, from the processors association, will speak this afternoon. I'm not here to speak on his behalf, but certainly investments in infrastructure, like live holding capacity, increasing that capacity, makes our plants run more efficiently, gives us the option, if the live market's strong, to put more product into the live market, and gives us more flexibility. The processing plants on P.E.I. need us, as harvesters—
Executive Director, Prince Edward Island Fishermen's Association
—and we need them also, and we want to keep those jobs here in Atlantic Canada.
Liberal
Karen Ludwig Liberal New Brunswick Southwest, NB
On the processing side, what do you do with your no-claw or one-claw lobsters?
September 27th, 2016 / 11 a.m.
President, Prince Edward Island Fishermen's Association
They go to the processing sector mainly, or if the company is processing tails, raw tails, we use some of that.
Liberal
Karen Ludwig Liberal New Brunswick Southwest, NB
You may want to look into the clawing up expansion that was announced recently in Nova Scotia. It was specifically regarding processing, but looking at no-claw or one-claw lobsters, and just different ways to remove the meat in a very high pressured heat.
Thank you.
Board Member, Environmental Coalition of Prince Edward Island
This plays into what Mr. Dhaliwal was asking before. I had looked into the Growing Forward program for my own start-up venture, to invest in simple things like a greenhouse or a tractor, and the help that I could get through that. That's an important capital investment that I can access in order to start the business. I think more things like that would help younger people get into the market, because I can't afford to take on the debt of a $1.5-million tractor, or 3,000 acres of land, or 1,000 acres of land. But you can make a living on 10 acres of land and a $10,000 tractor. It's just a matter of scale and getting to a high-value low-quantity market, rather than a low-value, high-quantity market, because we're a small province.
We can't compete with Iowa and other large-scale.... There's a limit to it. We can compete to a certain degree, but I think in order to really compete in the future, programs like Growing Forward that help young people get into high-value markets is really important.
Liberal
Karen Ludwig Liberal New Brunswick Southwest, NB
I will wrap this up quickly, I'm not sure if I can stress strongly enough how important it is that a young person is here on our panel, because you are our future and the future of our industry. Often young people think outside the box, and we really need your input at all times regarding any of these panels and any of our sectors that we're discussing.
Board Member, Environmental Coalition of Prince Edward Island
Thank you. I appreciate that.
Liberal
The Chair Liberal Mark Eyking
Thank you, Ms. Ludwig.
We're going to wrap up this round with Mr. Ritz.
Conservative
Gerry Ritz Conservative Battlefords—Lloydminster, SK
Thank you, ladies and gentlemen, for your presentations here today. It's all good information that we can certainly make use of.
Jordan, I'll start with you. You said a couple of things that I'll take exception to, talking about farm debt and farm assets. They're actually in better shape than they've been for 30 years, the debt-to-asset ratio. Farmers on this end...and Mary can probably tell you that. Net income has been going up steadily. This year it's down a bit, but in the past four out of five years it's been setting records. So things are good on the farm, but we want to keep them there.
There are programs available for young entrepreneurial farm ideas through Farm Credit Canada. They have a complete separate pot of money that has less demand on it. All they need is a good business plan from you saying what you want to do, how you want to do it, and they'll adjudicate it. You'll have a far better chance because they understand the need. It's a separate pot of money dedicated to exactly what you want to do. The thing you're going to have to address is how you do the seasonality of fresh vegetables. I agree with you. It's all about value, not volume. Ian made that point as well. But there are programs out there that maybe aren't well advertised, so certainly check that out.
Board Member, Environmental Coalition of Prince Edward Island
Right. Let me just comment about the asset-to-debt ratio. I forget in which years the graph started, but I've seen exports over a certain amount of time that have risen by 20 times. I think it was from the 1980s, around when the Canada-United States Free Trade Agreement was signed. In the same period of time, net income has risen six times, adjusting for inflation; so you see exports rising by over three times the amount of the productivity, and the money coming into the farm. On that same graph, there was a flat line at the bottom, and that's actually the money that's staying with the producer. There's a lot of money coming into the Canadian economy, but a lot of it is going to the middlemen.
Conservative
Gerry Ritz Conservative Battlefords—Lloydminster, SK
Sure, I've seen the ability of overlaying different graphs and coming up with an idea that you want. But talk to these guys. They'll actually tell you where it's at. That's not really reflective of what's happening out there today. Yes, the cost of farming is expensive, and yes, there's a lot of cash flow that's required, and so on, but they're also able to hang onto a lot more money than—
Board Member, Environmental Coalition of Prince Edward Island
This was Stats Canada. This wasn't like, you know....
Conservative
Gerry Ritz Conservative Battlefords—Lloydminster, SK
Yes, well, you're overlaying different things. But at the end of the day, certainly talk to the actual farmers. They'll tell you that life is pretty good.
On the whole aspect of diversification of trade, stability and predictability of markets, I'll go to the potato guys for just a second, on the phytosanitary stuff. We constantly argue with our major trading partner. The problem we have with the U.S.—and we've had this discussion, Greg—is that we'll have an agreement with USDA, but then state by state they will change it.
When you go to a TPP type of initiative, where the U.S. signs on on behalf of the states, if the states start to play silly bugger with phytosanitary, you can use the ISDS clause and actually take them to court to bring them to heel and to apply those new regulations. The ISDS is not just harmful to Canada, if you want to categorize it that way, it also creates a level playing field that we can use in reverse on some of those types of situations. We had this fight with potato wart, potato cyst, on seed potatoes and table potatoes. It's there to safeguard both imports and exports.
I had a number of other things, too, but we never have enough time.
There's never enough money for everything that needs to be done around marketing, but certainly with the new GF3, or whatever they're going to call it, coming up, there's lots of work to be done, and it has to be driven by innovation, by marketing, and so on.
Turning to the lobster guys, fisheries has always been a bit of an anomaly. You're under DFO, but the marketing is done by Ag Canada. There's always that tossing back and forth as to who's going to do it and how it's going to happen. A number of good food trade shows happen all around the world that you guys are taking part in and making connections.
Japan is a premium market, a value market. I agree with you that it's about value over volume. Canada is known around the world, commodity by commodity, as a premium supplier of quality products. We demand a little more for them, but we get them. Japan is actually buying more wheat now at a higher premium price than they did under the old wheat board regime. It's about making those connections.
There is tremendous work being done by our trade consular services. We kept increasing them, and I know the Liberals have every intention of doing that as well, because they're there to serve you. These are educated people. For the first time ever, in the last five years we have agriculture and CFIA people embedded in embassies and consulates around the world, to be there to help you, because they understand the files. It's not a Global Affairs person with an ag file; it's an actual ag person with your file. Make use of them. Make those contacts, the ambassadors, or back through the marketing side, Fred Gorrell and his guys at Ag Canada.
I know I'm out of time. It's unfortunate.
Liberal
The Chair Liberal Mark Eyking
You're out of time, Mr. Ritz.
That wraps up this panel. Thank you very much, panellists, for coming. That was a very diverse group, a lot of information, and good dialogue with the MPs.
We're going to suspend for 10 minutes and then continue with our next panel.
Liberal
The Chair Liberal Mark Eyking
We're going to continue with our TPP consultation process.
This is our third panel. We've had quite a few interesting panellists talking about the various industries and perspectives in P.E.I. on this major agreement that's in play right now, the TPP—12 countries, 800 million people, 40% of the world's GDP. Our committee has been travelling across the country. We've done seven provinces and we're finishing up in Atlantic Canada. We're also hearing from citizens. We have over 20,000 emails sent to us and we'll be receiving them into October. After October we'll be putting our report together and we'll present it to the House of Commons.
I thank the panellists for coming here. The way we do it is we'll start off hearing from each of you, for around five minutes, about your background, what you're thinking, and then we'll open it up to MPs to dialogue with you.
We have two groups. We have witnesses from the aerospace industry and from Trade Justice PEI. The seafood processors might come a little later, so we'll see what happens. If not, we'll try to get them on the next panel.
Without further ado, we're going to start off with Trade Justice PEI. If you could keep it to five minutes, it would be appreciated.