Evidence of meeting #28 for International Trade in the 45th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was potash.
A video is available from Parliament.
Liberal
The Chair (Hon. Judy A. Sgro (Humber River—Black Creek, Lib.)) Liberal Judy Sgro
I call the meeting to order.
Welcome to meeting number 28 of the Standing Committee on International Trade.
There is one bit of administrative work we have to do.
Committee members, you've all received a study budget for the trade with north and west Africa study. Do I have approval from our members to adopt the budget?
Liberal
The Chair Liberal Judy Sgro
Thank you very much.
Pursuant to Standing Order 108(2) and a motion adopted by the committee on Thursday, February 12, 2026, the committee is resuming its study of Canada's trade with the Mercosur countries.
With us today are long-time friends of the international trade committee. From the Canadian Meat Council, we have Claire Citeau, vice-president of international trade, and Jorge Correa, vice-president, market access and technical affairs.
From Chicken Farmers of Canada, we have Tim Klompmaker, chair, and Yves Ruel, associate executive director.
From Fertilizer Canada, we have Michael Bourque, president and chief executive officer.
Welcome to our witnesses. Thank you for taking the time to be with us today.
We will start with opening remarks.
Ms. Citeau, I open the floor to you for up to five minutes, please.
Claire Citeau Vice-President, International Trade, Canadian Meat Council
Thank you, Madam Chair and members of the committee, for the opportunity to appear today.
My name is Claire Citeau. I'm vice-president at the Canadian Meat Council, which is the voice of Canada's federally licensed meat industry. I am joined today by my colleague, Jorge Correa, vice-president of market access and technical affairs.
The Canadian Meat Council represents federally inspected meat packers and processors, as well as suppliers of goods and services to the entire Canadian meat industry. Our members directly employ more than 64,000 Canadians across the country and support approximately 300,000 jobs along the supply chain.
The meat sector is one of Canada's most trade-dependent industries. Exports account for over 50% of our beef production and over 75% of our pork production. In 2025, the sector exports were valued at more than $11 billion. This is why trade policy, market access and the reduction of non-tariff trade barriers are so important to the long-term competitiveness of our industry.
CMC supports Canada's efforts to diversify trade and expand opportunities abroad. We also support the government's ability to engage with Mercosur through formal trade negotiations, but we do not see the South American trade bloc as a priority market for Canadian beef and pork products.
Countries within Mercosur, such as Brazil and Argentina in particular, are major global competitors in beef and pork exports. Any new access there is likely to be limited and niche in nature.
Jorge Correa Vice-President, Market Access and Technical Affairs, Canadian Meat Council
For this reason, if negotiations proceed, the agreement must be carefully balanced. It should include a clear safeguard mechanism to address import surges in sensitive sectors, a robust sanitary and phytosanitary chapter subject to dispute settlement and a bilateral dialogue on SPS issues.
It should also provide for timely negotiation of export requirements and food safety approvals so that Canadian exporters can benefit as soon as the agreement enters into force.
The Canadian Meat Council believes Canada should continue to prioritize markets that offer stronger commercial opportunities to our agri-food exporters, including markets in the Indo-Pacific and the gulf region. At the same time, if Canada chooses to pursue an agreement with Mercosur, it must be done in a way that protects sensitive sectors and ensures the Canadian producers and processors are not placed at an unfair disadvantage.
In short, the Canadian Meat Council supports trade diversification, but Mercosur should be approached with caution. A Canada-Mercosur agreement can be acceptable only if it delivers meaningful safeguards, strong and enforceable SPS rules, and real benefits for the Canadian exporters.
Thank you again for the opportunity. We will be happy to respond to any questions.
Liberal
The Chair Liberal Judy Sgro
Thank you both very much.
We'll move on to Mr. Klompmaker and Mr. Ruel, please.
Tim Klompmaker Chair, Chicken Farmers of Canada
Thank you, Madam Chair.
Good morning. Thank you for the opportunity to appear today. My name is Tim Klompmaker. I'm a third-generation chicken farmer from Norwood, Ontario, and chair of Chicken Farmers of Canada.
Canada's 2,800 chicken farmers play a vital role in our economy and food system. Every day we produce safe, high-quality chicken, raised with care right here at home, for Canadians. We support trade agreements that grow Canada's economy, but not at the expense of domestic food production. Supply management ensures stability for farmers, reliable supply for consumers and ongoing reinvestment in rural communities across this country.
However, recent agreements—CPTPP and CUSMA—have already had a significant cumulative impact. Combined with WTO commitments, Canada has granted 129.6 million kilograms of market access, representing 10.8% of Canadian chicken production when these concessions were made. This is not speculative. It is real and significant access that was already provided.
A potential agreement with Mercosur presents an even greater risk. Brazil is the largest exporter of chicken in the world and the third-largest producer globally. In 2025 alone, Brazil exported 5.3 billion kilograms of chicken, roughly one-third of its total production. Their exports alone are almost four times Canada's total production. For Canada this is not a distant issue. Imports from Brazil reached 10.7 million kilograms in 2025, making it consistently our second-largest source of imported chicken after the United States. This scale, combined with lower production costs and expanding global reach, creates disproportionate pressure on Canadian producers.
The question becomes this: How do we pursue trade without undermining our own food system? For our sector, the answer is clear. Any Mercosur agreement must maintain current over-quota tariffs to preserve effective import controls, avoid any expansion of tariff rate quotas beyond existing commitments and exclude spent fowl tariff lines from preferential access, given their direct substitution with Canadian chicken. These are practical, necessary safeguards.
This discussion is also about consumer trust and food security. Today half of Canadians recognize the “raised by a Canadian farmer” brand. Among those who do, 60% say it makes them more likely to choose Canadian chicken. That tells us something important. When Canadians understand where their food comes from, they choose to support domestic production. At the same time, Canada can't be import-dependent. We've seen the risk of relying too heavily on imports. As per our trade commitments, we import 21% of hatching eggs from the United States, but recent shortages in their hatching egg supply demonstrate how quickly external dependencies can constrain Canadian production. As Canada works toward a national food security strategy, increasing import dependence moves us in the wrong direction.
As negotiations with Mercosur continue, our message is straightforward. We respectfully urge the government to maintain over-quota tariffs at their current levels, avoid any TRQ expansion beyond existing commitments and exclude spent fowl tariff lines from preferences. This position has been consistent through all trade negotiations. It is what protects Canadian consumers and strengthens our national food security. Canada will have to be firm in its response to ensure that no concessions are offered to Mercosur.
Thank you for your time. I look forward to your questions.
Liberal
Michael Bourque President and Chief Executive Officer, Fertilizer Canada
Thank you, Madam Chair and members of the committee.
Fertilizer Canada represents fertilizer producers and manufacturers, importers, wholesalers and retail distributors of nitrogen, phosphate, potash and sulphur. Together our members contribute over $42 billion annually to Canada's economy and....
Sorry, that's the problem with being on an iPad; sometimes you touch the wrong thing.
We support more than 118,000 Canadian jobs.
Fertilizer is essential to feeding Canada and the world. It contributes to roughly half of all global food production. At 23 million tonnes per year, Canada is the world's largest potash producer, supplying approximately 40% of global exports. Canada is also the most sustainable producer of potash, with emissions 50% lower than those of Russia or Belarus.
The current conflict in Iran is a reminder that fertilizers are a globally traded commodity and highly sensitive to geopolitical shocks. The conflict's shutdown of the Strait of Hormuz has created volatility in nitrogen, phosphate and sulphur markets, pushing prices sharply higher and raising concerns about meeting demand. An event far from Canadian farms, such as the war in Russia and Ukraine, a ship blocking the Suez Canal or instability in the Middle East, can rapidly tighten fertilizer markets and drive up global prices.
Canadian potash exports to the Mercosur region are a success story. Brazil is Canada's top potash market outside the U.S. Potash is also our largest export to Brazil and Uruguay, accounting for over half of all Canadian exports to Brazil by value. This success is due to a stable open trading relationship and the capacity to supply one of the world's growing agricultural markets.
Brazil's soils are inherently potash-deficient. Potash fertilizers allow farmers in Brazil to supply vital potassium to their crops, including corn, sugar cane, soybeans and coffee.
Canadian fertilizer producers are not just selling into Mercosur; we have a strong on-the-ground presence to meet growing demand. Canpotex has a permanent sales office, which they've had since 2018; K+S Potash operates a distribution centre in São Paulo; Mosaic has a significant footprint in South America with over 6,000 employees; and Nutrien operates in South America with 3,000 people across Brazil, Argentina, Chile and Uruguay.
Canadian potash is a key strategic asset for our trade with Mercosur countries, but our prosperity as a trading nation depends on our ability to move goods efficiently to global markets. Supply chain disruptions, often due to labour disputes at Canada's railways and ports, have resulted in lost market opportunities, eroding Canada's reputation as a reliable trading partner. When Canadian potash exports stall, Russian and Belarusian producers immediately move in to secure contracts and deepen their foothold in key markets.
Following the 2023 Port of Vancouver labour disruption, Canada lost market share to Russia and Belarus in Indonesia and Malaysia, sales that have yet to fully return. Even without disruptions, getting potash to global markets is no easy feat. Canadian potash is mined in Saskatchewan, travelling over 1,700 kilometres by rail to reach the closest port of export. Vancouver remains the most efficient and most cost-effective way to ship potash to Brazil's agricultural market.
We want Canadian potash to continue to be a success story in Mercosur markets. Fertilizer trade works best when it is predictable, tariff-free and insulated from broader trade disputes. One practical step to consider is addressing Brazil's vessel-based import tax, which applies to bulk shipments, including potash. This tax imposes an 8% levy on ocean freight and discharge costs. Securing relief for Canadian potash would provide a clear competitive advantage in a market in which we compete directly with low-cost producers like Russia.
Maintaining stable open market access while advancing targeted improvements like this will be key to growing exports in the region and reinforcing Canada's position as a reliable supplier. We strongly support efforts to deepen our trade relationships with Mercosur, along with Canada's broader trade diversification and export growth objectives.
Thank you for inviting me.
I look forward to your questions.
Liberal
The Chair Liberal Judy Sgro
Thank you very much.
We will start with our members.
Mr. Groleau, you have six minutes, please.
Conservative
Jason Groleau Conservative Beauce, QC
Good morning, Madam Chair and colleagues.
Guests, thank you for joining us.
I am a proud Beauceron who strongly defends agriculture. I come from a farming family. We want to help our farmers.
We've met with pork producers and other meat producers, and they don't look positively on Mercosur.
Mr. Ruel, how do chicken farmers see this agreement?
Yves Ruel Associate Executive Director, Chicken Farmers of Canada
Thank you for the question, Mr. Groleau.
As our association president said, this agreement is a threat. Brazil is a world leader in the chicken sector and in other agricultural sectors. It's the largest exporter in the world. To give you an idea, last year, it exported 5.3 billion kilos of products, about four times more than Canada's entire production, to more than 125 countries around the world. It's really a superpower in chicken production. Its production costs are extremely low, which means there's no way we can compete with Brazil's imports.
Associate Executive Director, Chicken Farmers of Canada
Certainly not Canadian producers.
Conservative
Jason Groleau Conservative Beauce, QC
Not at all, then.
Is it because of production costs? Is it because of Brazil's capacity as the largest producer in the world, as you said?
Associate Executive Director, Chicken Farmers of Canada
Brazil is the third-largest chicken producer and the largest chicken exporter in the world. I'm not an expert on Brazil, but you need only look at the statistics to realize its agricultural capacity. It's a world leader in many sectors, including various meats, as you heard my colleagues say. That's the case for the beef and chicken sectors, as well as other agricultural products. It's a very competitive and a very advanced country in the agricultural sector.
Conservative
Associate Executive Director, Chicken Farmers of Canada
That's why we say it's very important for Canada not to make any concessions. Brazil already exports to Canada under the World Trade Organization, or WTO, tariff rate quota. In 2025, Canada imported 10 million kilos of product from Brazil. It already has access to the Canadian market. As long as it stays within the current quotas, we're okay with that, because we honour the agreements Canada has signed. However, we don't want to give Brazil more access. That's very important.
Conservative
Vice-President, International Trade, Canadian Meat Council
The Canadian Meat Council echoes the concerns raised by others regarding competition. Brazil is a big competitor.
That said, we have processors and importers in our membership. We currently import products from Southern America. We see small opportunities. If we could take advantage of these small opportunities in specific niche markets, our members would agree to a limited access with strong safeguards to exercise a strict control.
However, that's not the priority. We see other opportunities around the world, including in the Indo-Pacific regions and other markets. I also want to say that our first priority remains the North American market. That's what market negotiations should be focused on, as well as the Asia-Pacific region or the Gulf region and elsewhere. Mercosur is really not a priority for our members.
Conservative
Jason Groleau Conservative Beauce, QC
Could there be a threat to Canadian jobs if our production were to drop because of increased exports?
Vice-President, Market Access and Technical Affairs, Canadian Meat Council
Absolutely. There's a direct link between our exports and Canadian jobs. That's one thing.
However, I don't think our jobs would be impacted by more imports from Mercosur countries. We regularly import from those countries, including Brazil, Paraguay, Uruguay and even Argentina. There are also Australia and New Zealand. As my colleague said, we'd like to focus a little more on other countries, such as China, the United States or the countries in the Indo-Pacific region, for all the reasons given.
Conservative
Jason Groleau Conservative Beauce, QC
I'd like to come back to you, Mr. Ruel.
We're proud of the chicken we produce. In Quebec and Canada, we produce excellent chicken. It's said to be the best.
Would lifting our barriers on a larger scale raise concerns about food security?
Associate Executive Director, Chicken Farmers of Canada
Thank you for being so proud of the chicken we produce. We absolutely are. You're right.
There are definitely concerns. As we said in our opening remarks, for hatching eggs, those used to produce the chicks for chicken farms, the current tariff quota gives the U.S. a 21% access to our market. In the last couple of years, with the avian flu issues, it's been difficult for Canadian hatcheries to get enough hatching eggs from the U.S. to supply our farms. This shows what can happen if we focus too much on a third country for our supply. If the third country needs these products, it'll use them and won't export them to their neighbours. That's been our experience over the past few years. The lack of hatching eggs from the United States has limited the expansion of chicken production in Canada.