Mr. Speaker, I appreciate the opportunity to comment on Bill C-300 as well as on some other important issues facing agriculture in Canada today.
Although this amendment may appear logical on the surface, it raises a number of questions and could in the long term undermine the Canadian Wheat Board as a single desk seller of wheat, barley and durum in Canada. Conservatives have a platform commitment to introduce a dual marketing system where farmers would have a choice to sell through the Canadian Wheat Board or seek their own markets. Bill C-300 is the first step in this direction.
The core of Bill C-300 is it would give farmers the right to sell grain produced by the producer directly to an association or firm engaged in the processing of grain if a majority of interests in the association or firm was held by a producer or producers in Canada. This terminology is wide open. For example, if a Japanese mill took on a Canadian farmer partner, that mill could circumvent the Canadian Wheat Board. If a group of farmers set up a milling operation, bought several times more grain than they needed, and then exported the balance unprocessed to the U.S., they would be bypassing the Canadian Wheat Board. If a group of Canadian farmers set up a cleaning facility in Canada, Bill C-300 might give those farmers the right to circumvent the CWB and then re-export the grain again.
This bill is an attempt to impose a very neat solution to a complex problem. It could trigger massive unintended consequences and set the stage for a raft of trade challenges. It could create a huge number of problems, all to solve a problem that to a significant extent does not really exist.
The Canadian Wheat Board is a self-sustaining democratic organization of farmers with a mandate to act in the best interests of farmers in the world marketplace. It is not a crown corporation, although it was created through legislation after World War II. The majority of members, 88%, believe that any changes made to the Wheat Board must be made by farmers themselves.
These are challenging times for the agriculture industry in Canada. There is tremendous pressure from major world players to modify or to get rid of not only the Canadian Wheat Board, but also our supply management system. It is my personal belief and the belief of my party that we must as a nation resist this temptation in the interests of our own food security.
For example, our supply management system works very well in Quebec and in the rest of Canada. The government does not give subsidies and producers, for the most part, can make ends meet. Tremendous pressure is being applied at the WTO on Canada to modify its supply management system. The objective of the negotiations is to remove customs barriers and other obstacles to trade, to the advantage of the poorest countries.
Developing or emerging countries, with Brazil and India at the top of the list, are calling for large reductions in American agricultural subsidies and European customs duties. Americans and Europeans, while passing the buck for the impasse from one to the other, are applying pressure on poor countries to open their markets to their industrial goods and services. For its part, Canada wants the United States to reduce its agricultural subsidies. Here in Canada, there are those who believe that by adjusting the supply management system we will have even greater access to world markets.
In a sense, our supply management system, which protects primarily the dairy, egg and poultry sectors, is closely tied to the Canadian Wheat Board. These are two Canadian-style solutions to problems faced by our farmers. There will be an enormous price to pay if we begin dismantling them.
I would like to thank our Minister of Agriculture and Agri-Food for his willingness to defend our supply management system at the WTO.
There are other positive signs that the government is taking an active role to assist those in the agricultural sector. One is the willingness of the minister to participate in tobacco industry-led forum to discuss an exit strategy that is fair and equitable for Canadian farmers.
I also urge the minister not to abandon farmers in the grain and oilseed sector. The Americans are looking after their farmers and they are making money. We must have a short and long term strategy to level the playing field until such time as we can convince other countries to reduce their subsidies.
This should involve an immediate injection of sufficient funds for disaster relief for farmers hit hard in northeastern Saskatchewan. Let us not forget that what is at sake here is the survival of our rural communities and our way of life.
The negotiating position of the Government of Canada at the WTO talks has been to defend the democratic right of Canadian farmers to choose the kind of marketing institutions that will best serve their interest. For western Canadian farmers, this means defending the Canadian Wheat Board, with its statutory authority as a single desk seller.
If farmers want to change the board's mandate, they must be able to do this through their own democratic elections or through a plebiscite. It their decision and it should not be interfered with by the WTO or by us in the federal government.
The U.S. and the European Union want us to remove that decision from our farmers. At the World Trade Organization talks, their negotiators have been clear that they want an end to our single desk authority of organizations like the Canadian Wheat Board, which in their terminology are called state trading enterprises. The WTO position of the U.S. and the European Union, which represents the position of large grain companies, would basically outlaw the ability of farmers to have an effective organization able to compete with these companies.
This bill mirrors the debate surrounding the Canadian Wheat Board. It would result in a series of undesirable consequences and would open the door to a multitude of commercial disputes.
Let us review one scenario. A group of Canadian farmers establishes a processing plant in North Dakota. Bill C-300 seems to grant to these farmers, and to all western Canadian farmers, the right to transport their grain across the border to the plant. Bill C-300 states that producers established in Canada must have a majority interest in the company that purchases these facilities.
The bill could unleash a number of trade challenges because it gives legislative advantages to some processors and not others. For example, a farmer owns a co-op pasta mill, buys durum and pays farmers a price equal to what other farmers in the region receive from the Canadian Wheat Board. Corporate owned pasta plants, which are barred by their ownership structure from accessing durum at this lower price, then decide to sue under chapter 11 of NAFTA.
Another possibility could be that U.S. farmers want to set up a pasta plant in Manitoba and take advantage of the ability to buy grain at the Canadian Wheat Board price. If they are refused, they may have a case under the national treatment clauses of trade agreements, which stipulate that nations cannot discriminate between enterprises in their own countries or foreign countries.
The Canadian Wheat Board has on occasion been inaccurately portrayed as an impediment to value added processing in Canada. There is a belief in parts of the farming community and in some government quarters that an exemption for the domestic processing market is workable, if not for the entire domestic, certainly for processing operations owned by farmers.
Let us ask some questions. Would an exemption for farmer owned processing plants provide farmers with increasing marketing choice? It would only do so if the exemption results in producer owned plants coming into existence either through new construction or purchase of existing processing capacity. Would this exemption increase value added economic activity in western Canada by attracting local investment and creating jobs in rural areas? Western Canada, with its small population, is not considered a particularly advantageous location for producer processors.
Bill C-300 does not specify or dictate where producer owned facilities must be located and does not alter the existing comparative advantages. Therefore, it is not likely to promote growth specifically in western Canada over elsewhere.
I believe we have to defeat the bill. We must let the producers, themselves, decide the future of the Canadian Wheat Board. It is my hope that today we will make that decision.
