Transport Committee on March 31st, 2022

[Christian Buhagiar]

Mr. Chair, through you to the member, it's a wonderful question and I appreciate it.

The first thing that I want all of the members to appreciate is that this is not a unique situation to Canada. It's not a unique situation to Canada's ports. I think that's important for us to recognize. All ports globally are finding the same challenges.

However, here's the issue: All ports, for the most part, operate the same way. They operate in a way where there is not a synchronization between all of the parties that exist within a port. It's still a relatively manual process. It is labour-intensive. It relies on there being enough chassis to take the container and move the container before something else can move.

There is a lot of discussion now around whether or not that remains, in today's world, the best way to manage, schedule and off-load ports. Again, it's not just here in Canada. It's at every port.

[Matt Jeneroux, Conservative, Edmonton Riverbend, AB]

Christian, can you give examples? What's happening in the Port of Vancouver? We went as a committee a few years back and toured it. At the time, it seemed like the trucking industry was where a lot of the holdups were.

Could you be specific to something like the Port of Vancouver and what the holdup is in that particular port?

[Christian Buhagiar]

No, Mr. Chair, I can't. I think it would be unfair for me to speak about Vancouver.

Again, Vancouver is no different from any other port in the sense of how it operates, is synchronized and how the different players and pieces function in ports. People don't realize that in a port, you have a number of different actors who are all working together.

[Matt Jeneroux, Conservative, Edmonton Riverbend, AB]

How quickly are things getting off the boats, then?

Again, with those tankers out there in English Bay.... I'm picking on Vancouver, but as you say, it's everywhere. Are they getting off the boats and then sitting in the ports? Are they waiting out in the ocean? I'm trying to figure out where the solutions are that we can really focus on during this study.

[Christian Buhagiar]

Yes. I think you've asked the right question. The challenge is that the answer isn't one piece within that. I think that's what I would really want the members to appreciate. The synchronization of all of that has to change fundamentally in how it operates. That will come through automation, which will allow the right scheduling so that things can move faster. It's not that they're not being as effective and efficient as they can be within the construct that they have. We probably need to change the construct.

Now, I will say, and I've been slapped on the wrist before for saying this, that when we talk.... I was at the supply chain summit, with my colleagues who are on the phone, and I raised the issue of automation in the ports. That immediately raised concern from the labour unions who were also participating. My point was that this isn't a question about reducing the human capacity. I'm not here to try to suggest that we shouldn't have union workers and that we shouldn't have more, but they don't have the tools, the automation tools, to be able to do things. This is a fundamental shift in how all ports need to operate. Is Canada going to step up and invest and push the envelope to make those changes, or are we going to wait for someone in Europe or someone in San Francisco to do it? That will be the challenge.

It's a complex issue. These are all complex issues. That's the challenge. I wish I had silver bullets. We don't, though.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Buhagiar and Mr. Jeneroux.

Mr. Badawey, you have five minutes. The floor is yours.

[Vance Badawey, Liberal, Niagara Centre, ON]

Thank you, Mr. Chair.

I really appreciate this discussion. I'll be concentrating my questions on Mr. Buhagiar.

Back in 2019 the Standing Committee on Transport, Infrastructure and Communities presented a report to the House of Commons. It was entitled “Interim Report on Establishing a Canadian Transportation and Logistics Strategy”. I would recommend that all the witnesses today take a good read and then possibly send us—me in particular, as one member of the committee—some of your thoughts on that strategy.

The reason for that, Mr. Buhagiar, goes to your comments with respect to what you're speaking about. I want you to comment a bit more on it and dig a bit deeper into the weeds. I want you to comment on the need for redundancy, whether it be rail, road, air or water, but primarily rail and road, because we see a lot of the port-related infrastructure to some extent at par with expectations, as well as air. I will get back to that in a second.

The second area is the importance of infrastructure investments, and add to that all the investments of new capital projects. Equally important is maintaining and managing the assets that we currently have. For example, there's the St. Lawrence Seaway system, and the Welland Canal in my neck of the woods, but also the Asia-Pacific, Halifax, Montreal, CentrePort and the list goes on. How important is it to have strategically located trade corridors that can take advantage of that multimodal network that's available throughout the country?

Ports modernization you mentioned earlier. We are embarking on a ports modernization review as we speak. How important is that? Of course, getting into this report, I'd like your testimony about that and the other points I'm bringing up. Integrating, distribution, data, digital logistics—I need to hear from you on that and get your testimony on the record.

Finally, my message to the analysts is that they add as an exhibit the actual Canadian transportation and logistics strategy as part of this study so that it can referenced, because a lot of the 31 recommendations can be leveraged in this study as well.

Mr. Buhagiar, the floor is yours.

[Christian Buhagiar]

Mr. Chair, through you to the member, thank you.

You certainly have our organization's commitment to look at the study, and we'll send you our feedback directly.

There are just a few things, because you touched on many of them. I think they're all valuable and I think you're spot on. Let me deal with three comments, for the sake of time.

One was your questions around what I would call secondary transport corridors, twinning of our transportation routes. Doing that is critical, but it's a challenge. We're a large country. Twinning all of our transport corridors would probably not be economical. The question then becomes one of strategically looking at where we need to ensure we have secondary corridors and then making the investments in those places.

With respect to ports, one of the challenges we have—I spoke earlier mostly about automation—is that we don't have, beyond our five international gateways, really the ability to quickly put into action other international ports.

Canada Border Services has had an issue with that in the past. I think that's an area this committee might spend some of its time on to understand how we can ensure that we have alternative international gateways, so that when our five are congested, there is an opportunity to use others. There I'm going to pick up on what is certainly your neck of the woods, the St. Lawrence and the Great Lakes. We have an opportunity with the St. Lawrence and the Great Lakes to look at how those can be incorporated into our international gateway system.

Certainly I think all of those types of opportunities to expand our transport corridors would be helpful.

I hope that was an answer, and we'll certainly follow up on the strategy comment.

[Vance Badawey, Liberal, Niagara Centre, ON]

Mr. Buhagiar, my last question is with respect to the importance of working with our binational partners too. When we look at the Great Lakes, for example, and the St. Lawrence system, the Americans share that resource with us.

How important is it for us to work with our American partners on everything I mentioned earlier in terms of the investments, the fluidity, etc.?

[Christian Buhagiar]

My quick answer will be that it is critical. The reason for that, as I suggested in my testimony, is that a national strategy is important for a supply chain, and even more important would be having a North American strategy.

In a supply chain, the larger you expand the strategy, the more beneficial it is to ensure that the flow works, so I think you're on to something. I would certainly encourage you to continue down that path.

[Vance Badawey, Liberal, Niagara Centre, ON]

That's great.

Thank you for that and thank you for being here, Mr. Buhagiar and all the other witnesses.

Mr. Chairman, thank you.

[The Chair, Liberal, Peter Schiefke]

Thank you, Mr. Badawey.

I'll now give the floor to Mr. Barsalou‑Duval.

Mr. Barsalou‑Duval, you have two and a half minutes.

[Xavier Barsalou-Duval, Bloc, Pierre-Boucher—Les Patriotes—Verchères, QC]

Thank you, Mr. Chair.

My question is for Mr. Buhagiar.

So far, we have not discussed the issue of cyber security. However, in the last few weeks, several witnesses before the committee told us that this is an increasingly important issue for supply chains.

To what extent is this the case? How could this be addressed?

[Christian Buhagiar]

Mr. Chair, through you to the member, I think this is an important question.

Let me just give you one statistic to start. I mentioned earlier that recently we did a survey of our members with respect to the Russian invasion of Ukraine. One of the questions we asked in that survey was whether or not their companies were discussing cybersecurity and business continuity with their suppliers. I can tell you that in that survey only 37% of the respondents said they were having discussions on cybersecurity with their tier one suppliers.

Herein lies the issue again. It's a critical issue. It can disrupt supply chains, but not all of our corporations are necessarily going to have the conversations. If they're having conversations within the confines of their corporation, they may or may not be having enough conversations downstream through the tiers of their suppliers.

This is a critical issue, and I wish I had the answer for it, but I think this committee and the government need to really look at ensuring that our corporations are having those discussions and that the support is there for them and their suppliers to make sure they have resolutions in place.

[Xavier Barsalou-Duval, Bloc, Pierre-Boucher—Les Patriotes—Verchères, QC]

Since I still have some time left, I will ask a brief question to the people who deal with the transport of fruit and vegetables.

Earlier, I spoke briefly about local production. We are seeing the emergence of microproducers, that is, producers whose crops come from much smaller areas than the large lands used in the past.

To what extent could these vegetable microproducers be integrated into a larger supply chain? Do you see any opportunities for that?

[Guy Milette]

The future of these microproducers is very promising.

However, we should not necessarily seek to give these microproducers greater access to the supply chain. Rather, there should be thousands of these microproducers, because there is a regional connotation to microproduction. It meets a regional need and its distribution is local. There is pride in local production in very close proximity.

Microentrepreneurs are very much encouraged to do this. This is much more evident in the organic system than in the conventional system, since most microenterprises work in the organic sector. In fact, some microenterprises stand out.

This is a promising way forward. We hope that hundreds, if not thousands, of people will start this microproduction.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Milette and Mr. Barsalou‑Duval.

Next we have Mr. Bachrach. The floor is yours. You have two and a half minutes.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Thank you, Mr. Chair.

There was recently some news from Canfor indicating that they're going to be cutting back production at their western Canadian sawmills due to constraints in the supply chain. In the riding that I represent, this means that sawmills will be cutting back shifts and workers will have less work. That's a big concern for us.

Mr. Buhagiar, what can be done to mitigate the impact of these supply chain challenges on the forest industry?

Second, can you comment on the issue of shipping product? When you have a backlog of product that needs to get to market, who makes the decisions about prioritization? How can that be resolved, so that companies like Canfor can get their product to market in a reliable way?

[Christian Buhagiar]

Mr. Chair, through you to the member, thanks for the question.

I can't answer the first part of the question. I don't have that knowledge. Let me come to the second, on prioritization.

If we look to the earlier conversation of ports, there isn't a prioritization. There generally isn't a prioritization in the transport system. That's one of the things that came up with critical supplies during the pandemic. Things work in a very linear fashion in that world. We can't pick and choose what we want to take off a ship or what we want to put on a train and get moving. That's the challenge of the linear nature of the system. Our system isn't as responsive in that sense as we might think or hope that it is.

Those are fundamental changes that need to happen before that sense of prioritizing certain things and getting them out and on the road would even be able to take place.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

I'll use the time I have left to ask a question of Mr. Lemaire.

I believe it was you, Mr. Lemaire, who mentioned this idea of a supply chain commissioner. I wonder if that kind of prioritization might be something that someone in that role could work on. My understanding is, as it now sits, that you might have perishable product from the Produce Marketing Association that needs to get to market, where other non-perishable products are ahead of those products in the line and have been prioritized.

Is that kind of prioritization something that you would see the commissioner that you mentioned tackling?

[The Chair, Liberal, Peter Schiefke]

Give a very quick response.

[Ron Lemaire]

The short answer is yes, and then looking at what the right municipal, provincial and federal levers need to be in place to help that happen.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Lemaire.

Thank you very much, Mr. Bachrach.

Next we have Ms. Gladu. The floor is now yours. You have five minutes.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

That's good. I have the right list of witnesses now, but the questions are the same.

Let's talk to any of the witnesses who want to talk about the rail situation in Canada. We've seen numerous rail blockades, disputes and labour disputes that have impacted the supply chain in rail across Canada. That situation looks like it's vulnerable.

I'm interested to hear from the Canadian Canola Growers Association or Supply Chain Canada. What do you think the federal government needs to do to put some more resiliency and confidence in that supply chain?

[Dave Carey]

Do you want to start, Steve?