International Trade Committee on March 9th, 2023

[Jan Slomp]

Thank you.

[The Vice-Chair, Conservative, Kyle Seeback]

We're now going to Monsieur Martel.

Mr. Martel, you have five minutes.

[Richard Martel, Conservative, Chicoutimi—Le Fjord, QC]

Thank you, Mr. Chair.

Mr. Gobeil, on November 14, 2022, in an article published on Radio-Canada's news wire for Saguenay—Lac-Saint-Jean, you said that you were happy with the compensation granted by Ottawa for the losses resulting from the signing of the Canada-U.S.-Mexico Agreement, or CUSMA. You said that this ended more than three years of negotiations with the government.

I would like to know whether those negotiations with this government actually happened. In fact, we keep hearing that the government doesn't usually negotiate.

[Daniel Gobeil]

Good afternoon, Mr. Martel.

Yes, the negotiations happened. We made many representations in the first round of negotiations for compensation, because the government was supposed to announce compensation for the three agreements in that first round. In the end, it announced an initial compensation payment for the impacts of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, or CPTPP, and the Canada-European Union Comprehensive Economic and Trade Agreement, or CETA, and then another one to finalize the negotiations.

That said, yes, the dairy producers from Quebec and across Canada worked with the government to help announce this compensation.

[Richard Martel, Conservative, Chicoutimi—Le Fjord, QC]

I would like to ask Mr. Lampron the same question.

[Pierre Lampron]

Thank you for your question.

It's important to understand that we want to turn the page, and I think the bill helps us do that. We've given up enough. Canada has signed 15 free trade agreements, and only the last three provided access to our dairy market. That means we can engage in trade without those concessions, but little by little, they crept into the last three agreements.

As Mr. Gobeil said, we are glad it's over, but we don't want it to happen again. We don't want the sector to need compensation every time a trade deal is signed. That's not the model we want. We've committed to achieving net-zero emissions and other things, but producers need stability and predictability so they can plan for the future. That's why we are glad, but we don't want any more agreements like that.

I want to be crystal clear. That's not the model supply-managed dairy farmers want.

[Richard Martel, Conservative, Chicoutimi—Le Fjord, QC]

Mr. Gobeil, you are supposed to receive a total of $1.7 billion in compensation, to be paid out over six years, until 2030, if I'm not mistaken. Are you certain you're going to get the money? It may have been in the economic statement, as you said, but there's nothing in writing, and we don't know whether the compensation will be in the government's budget.

Do you have a written agreement? Is it supposed to be in the upcoming budget?

[Daniel Gobeil]

Yes, we are very confident. For CUSMA, producers will receive $1.2 billion in direct assistance, and we are certain we will get that money. As Mr. Lampron mentioned, the government made a commitment in the economic statement.

What we care about, Mr. Martel, is meeting the needs of the market and producing milk for Canadians. The compensation model doesn't work for dairy farmers or any other supply-managed producers. Every entrepreneur in Canada wants to grow their business. Some want to achieve that growth by going after export markets, but we want to grow by meeting Canadians' dairy needs.

These agreements take that ability away from us. With all these agreements being signed one after another, there has been no growth for those in the dairy sector who invested in farms, not anywhere in the country. That is why we need to stop following this model.

[Richard Martel, Conservative, Chicoutimi—Le Fjord, QC]

Thank you, Mr. Gobeil.

Mr. Lampron, I'm curious. Did you get a commitment from the Minister of Finance that the budget would include the $1.7 billion in compensation over six years?

Do you have an agreement on that?

[Pierre Lampron]

Your implication that we won't be getting our money is starting to stress me out. I believed we were getting it and we could move on, but your persistent questions are making me think twice.

We will look into it to make sure. In my mind, it was a sure thing. Farmers are expecting that money. I don't think the government can toy with farmers like that. It made a commitment.

We'll take a closer look, to see if there's anything we could be missing.

Thank you.

[Richard Martel, Conservative, Chicoutimi—Le Fjord, QC]

How much time do I have left, Mr. Chair?

[The Vice-Chair, Conservative, Kyle Seeback]

You have 20 seconds.

[Richard Martel, Conservative, Chicoutimi—Le Fjord, QC]

Those payments are expected to start in January 2024 or at the end of 2024. It's hard to keep track. When is the department going to announce a date? There isn't much in the way of details.

[Pierre Lampron]

As Mr. Gobeil said, we received a compensation package for the first agreements, and those payments were made, as promised. We hope things will continue that way. In the first years, everything went fine.

Thank you for your concern.

[Richard Martel, Conservative, Chicoutimi—Le Fjord, QC]

Thank you, Mr. Lampron.

[The Vice-Chair, Conservative, Kyle Seeback]

Mr. Virani, you have five minutes.

[Arif Virani, Liberal, Parkdale—High Park, ON]

I'd like to thank all the witnesses for their contributions.

Welcome back to Parliament, Mr. Turp.

I'm going to start with.... Obviously, this is an important system of Canadian policy, which was created by the government of Pierre Trudeau in 1972.

I want to start with David Wiens.

If I heard you correctly, you talked about climate targets in your opening statement. When I think about food and food purchasing ideas, in my simplistic mind.... We hear about thinking globally but shopping locally—reducing the carbon impact of a product we can get locally, as opposed to one we get from somewhere around the world. It sounded to me as if you were talking about climate targets and efforts on the part of farms in Canada to get to net zero.

Can you elaborate on how protecting supply management helps with meeting climate targets?

[David Wiens]

Thank you for the question.

We set a target to be carbon-neutral by 2050. Of course, it's going to take more work to get there. We are doing very well. At this point, we have about half of the average carbon footprint of dairies around the world. We're off to a good start. This means farms across the country are going to have to continue to make changes and innovate. Of course, this cannot be done without the revenue we have now, on a per-farm basis. It's impossible.

Environmental sustainability comes with economic sustainability. Once that begins to erode, there will be things we can now do, very proactively, that we won't be able to do. That is a huge concern for us. As it begins to erode, a lot of these actions we want to take are delayed. Of course, that makes it more difficult to reach those targets.

[Arif Virani, Liberal, Parkdale—High Park, ON]

Thank you.

I want to turn to my second question. I will address it to Mr. Slomp, but I would appreciate it if Mr. Gobeil and Mr. Turp could also weigh in. I will build on this climate point.

Mr. Slomp, you mentioned the atmospheric river in B.C. last year and how extreme climate events can have devastating impacts on food security. Notwithstanding that atmospheric river, the folks in B.C. were still able to meet and provide what they were allocated. It created a stable supply chain. Mr. Gobeil mentioned this, and Mr. Turp talked about it as “food sovereignty”—this idea of national food security and food control and the ability to nourish your own people.

When we're dealing with supply chain disruptions, either from an unlawful war in Ukraine or atmospheric climate events.... Can you elaborate on how protecting supply chain management ensures predictability, in terms of the supply of food and the price of that food?

Perhaps Mr. Slomp can go first, then Mr. Gobeil and Mr. Turp.

[Jan Slomp]

The provincial marketing boards are always working on supplies to processors and, indirectly, to retailers. They have a tight-knit organization that makes sure these things are done on a daily basis. The system, very predictability, produces on the basis of needs.

We also have interprovincial relationships among those marketing boards that allow for interprovincial transportation, if needed. They back each other up. In the case of a drastic event, we have a secure system in place to guarantee a steady supply to Canadian consumers. The other sectors that are always looking for export opportunities don't have that. They totally rely on the grocer to do that for them in that process.

We have the system in place to deal with more erratic events in the future.

[Arif Virani, Liberal, Parkdale—High Park, ON]

Would you care to add anything, Mr. Gobeil or Mr. Turp?

[Daniel Turp]

I would add this. During the pandemic, we saw what happens when you rely on exports. We realized that we needed greater sovereignty over food and medical supplies.

Thanks to the supply management system we currently have, we don't have to depend on exports. If that system comes under fire, we'll see more and more exports coming in, and farms will disappear. If that happens, we could become export-dependent and struggle with food sovereignty.

[Daniel Gobeil]

Thank you for your question.

My fellow witnesses gave some great answers.

I talked about supply management earlier. It's about sharing the costs as well as the risks. Those risks are weather-related, but also productivity-related. Mr. Turp touched on this. During the pandemic, we saw how products could be missing from the supply chain. The effects of the flood in British Columbia were felt right across Canada's dairy sector.

[The Vice-Chair, Conservative, Kyle Seeback]

Monsieur Gobeil, I'm going to have to stop you there. We're about 40 seconds over time.

Monsieur Savard-Tremblay, you have two and a half minutes, please.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

I'm going to give my time to Mr. Perron for this round.