moved:
That this House do now adjourn.
Mr. Speaker, it is a pleasure to rise the second time today to talk about agriculture and to get a few more things on the record. I am more than pleased to see that the minister is joining us today. He has been dedicated on this file. We cannot take that away from him.
I will be splitting my time with the member for Newmarket—Aurora.
For a number of producers who are watching tonight, the urgency started 18 months ago. They have been living on a wing and a prayer ever since that.
Government programs have been announced, and they have come and gone. Not a lot of producers were able to trigger what they needed in a timely and bankable way. The light at the end of the tunnel disappeared the other day with the injunction by R-CALF in the United States.The light blinked out for the time being, and we have to reignite it.
Part of that will have to be done within our own borders. We have to start to develop programs that are domestically driven and that will see our industry survive, in spite of not getting into our major exporting partner in the United States. It may be a while before that comes around.
A lot of anger and frustration is out there as well as a lot of backlash, which people are talking about now. The Americans are not the bad guys. We have a tremendous amount of allies across the line. We need to ramp up our work with them. I am sure the minister will run through that list later.
The retail association, the consumers association and the American Meat Institute are calling this a blow to free trade. Those are their words. They all are looking for that cross-border shopping to recommence.
The packing industry in the States is facing as big a blow as the Canadian packers at this point. The packers are not getting enough product in to keep their lines open. They are down to three-quarter weeks. People are being laid off. A lot of hurt has been created by the R-CALF injunction, some 10,000 members of a 1.5 million member organization. It is economically and politically driven. Science has no bearing at all on that injunction.
We saw the work up from the judge in Montana. A lot of the things he talked about were just pure nonsense, and will be refuted. The unfortunate part is we are relying on the USDA, secretary of agriculture Johanns and the President of the United States to intervene on our behalf.
The government could and should be doing things. We need a stronger presence in the States. Let us buck up and start to realize that we are in this in a common way. Let us get down there and make those points. I know they have been done on an ad hoc basis, much the same as the programs were on an ad hoc basis. We need consistency at the political and diplomatic levels. We have it at the bureaucratic level. We have to ramp that up a little or we will face the same types of things.
There has been a huge ripple effect and a lot of collateral damage over the past two years in the livestock sector. It is not only cattle. We talk about cattle because that is the mainstay of that trade. However, a tremendous number of other sectors have been negatively hurt, and we are not carrying the flag for them in the same way. We think that they got drawn down with the cattle and that they will get built back up again once the cattle moves.
When we talk about processing for livestock, every facet of livestock needs more processing. Our pork producers are facing the same things trying to export live hogs, but as soon as they are processed, there is no problem. We need to ramp up the processing. Our buffalo producers were just starting to get their feet back under them, but they have been hit and sucked down with this as well.
The problem that needs to be directed or solved in the near future is in our processing sector. We have let slaughter capacity and processing go over the last 20 years.
We have had heavy-handed regulations. The Canadian Food Inspection Agency inspectors have not been as user friendly as perhaps they could have been. I guess the minister may have to drive them a bit harder to do that. We have seen a couple of plants squeak into production, only after they have jumped through a lot of hoops and hurdles that were put in their way. They did not need to be there. They dragged it out, and they could have got there a lot quicker.
We have a few other plants that would like to open, but they have seen the trials and tribulations of other plants so they are pulling back a bit. As I said, there is that collateral damage on other livestock sectors.
We have to ramp up our processing and slaughter capacity. The government has talked about that. The only thing we have seen to that end is the loan loss reserve, $37 million or $38 million announced in September, topped up again in the budget by another $17 million, but nobody can trigger it. The forms are not even available yet. We met with the Canadian Bankers Association the other day. It said it was still working out the details with the government.
We have again lost six months in getting some slaughter and processing capacity going because we are playing around with the loan loss reserve, which means somebody will finally get some money. When and if they ever get built and go broke they will finally get some coverage. That is not going to trigger any expansion. Nobody is going to buy that one. That is something that definitely needs to be done.
First and foremost is to get some cash to hard-pressed livestock producers. Agriculture across the country in the year 2003 hit bottom with a minus $13 million income and 2004 is not looking a whole lot better.
We get into a little bit of positive numbers when we put all the government moneys in. A lot of announcements have been made. The minister talks about a cumulative almost $5 billion going into agriculture across the country. Those are the announcements. The reality of cash in the pockets of producers is a third of that at best. We still have pools of money sitting here in Ottawa that have not been triggered and have not got out there to the farm gate. They are still sitting on the cabinet table and not on the kitchen tables out there.
Spring is coming. We have grain and oilseed sector guys who are worrying about how they are going to get their crops in the ground. We have livestock producers who are bringing another crop of calves on the ground and do not know whether they will be able to move them in a timely way to pay their loans and get caught up again. Agriculture in this country, for all commodities, has faced some serious hits. Let us get some cash out there on these ad hoc programs.
Of the three pillars that are required, one is the new and emerging markets that are out there. They are buying from someone, but not from us at this point. China is a huge market coming on stream with a billion people who are hungry. The big thing with China is that we are going to have to process some of it to get it over there and we are not up to that game at this point. There are things the government can be doing almost immediately to get that started. We are seeing more of the farm groups coming to bear on this and struggling for their producers.
David Rolfe is the chair of Keystone Agricultural Producers in Manitoba. He said that he has problems with the CAIS program. He is not optimistic that CAIS can ever be made effective. He says it is a bad deal. He is quoted as saying that “CAIS is essentially CFIP”, the former program, “with a deposit”. Farmers have to put cash in a bank vault somewhere in order to trigger a payment someday somewhere down the road. That is like me going out to the dealership, buying a new tractor, leaving it there and never using it. It is cash stuck away that I cannot use.
We met with the Agriculture Canada officials today, who said that it is not a negative thing. The farmer puts some cash in the bank, triggers a CAIS payout and gets money back, so it is not a bad deal. The problem is that it costs him a couple of thousand bucks with his accountant to make that happen and in a lot of cases what he triggers out of CAIS does not even pay for his cash on deposit. It is not the cashflow stimulus that everyone is looking for. There is actually a negative hit in a lot of this.
I know the minister has talked about how the government is going to do a review. In the budget, the Liberals talk about getting rid of the deposit, but the officials today told us that the most they can do by the end of March is pay back anyone down to the third value, which is what all of us called for, but some guys are trapped in a catch-22 and had 100% of their deposit in. They will get two-thirds of that back and probably will be taxed on it if it came out of certain NISA accounts, but they still have to keep that third in there until all governments figure out how they are going to keep farmers “engaged” in this business risk.
Producers are engaged. A $44 billion agricultural debt across the country keeps them engaged. Having to put a crop in the ground every year and spend the value of the equity of their farms keeps them engaged. Bringing on another inventory of cattle into their livestock sector keeps them engaged with all the costs that are involved in that. They are engaged up the wazoo.
So a cash deposit is not required; it is trying to make the CAIS program GATT green. That is what the government is trying to do. It is taking an amber program, running disaster relief through it and requiring a cash deposit to make it GATT green. That is what this is all about.
The government is penalizing our producers to stand up to the global agreements that we have signed on to, and our guys are going down. They are. They are taking this hard. They cannot stand up to it.
The Canadian Federation of Agriculture, in its meeting just last week, called for the government to implement a cull cow program. We talked about that a year ago. We talked about putting $500 an animal cash in the pockets of producers out there to get rid of some of these cull animals that are a drag on the market and pulling us down.
The numbers show that the programs are not working. The ad hoc announcements after ad hoc announcements are not doing what they are supposed to do.
The government is looking for direction. It is talking about doing the right things, but implementation is awfully slow. I am hopeful that some of our producers will survive long enough to see a difference.