Mr. Speaker, it is a pleasure to stand here today to speak to the motion.
Since the motion addresses agriculture, I would like to recognize my much older brother Alan on his Groundhog Day birthday as well as his outstanding career as a rancher, grain farmer and businessman. He was my first farming partner from a time long ago when we were both teenagers.
Last year, Canada's 60,000 grain producers exported some 40 million tonnes of world-class grain products worth over $20 billion. That is important for agriculture because it represents about half of all agriculture and food exports, but it is also important for Canadians who live in cities. A strong agriculture and food sector drives one in eight jobs in our country and almost 7% of our gross domestic product.
Canadian grain farmers depend on exports to sell 70% of their wheat, 75% of their pulse crops and 85% of their canola. That is why the rail service is so critical to Canada's hard-working grain farmers.
Regarding today's motion, our government has taken steps to address each of the five points, namely: recognizing that improved rail service is essential to farmers' livelihoods; recognizing that the ongoing review of the Canada Transportation Act will provide an opportunity for improvements; the need for all stakeholders to sit down together; the need to correct the imbalance of power along the chain; and ensuring government and industry work together. We have addressed these points and we continue to do so. Let me elaborate.
We recognize our rail service is essential to the livelihood of Canadian farmers. Likewise, we have moved to address the imbalance of power along the logistics chain.
Canadian farmers pay over $1 billion to move regulated grain by rail. On the prairies, grain travels an average of 1,400 kilometres to reach a port position. Our farmers and our economy depend on efficient, effective and reliable rail service to move those crops off the farm to our valued customers in Canada and around the world. That is why a year ago our government took action when our farmers were facing the prospect of moving a record crop.
First, we introduced an order in council mandating the railways to move a minimum volume of one million tonnes of grain a week, backed by penalties. Two weeks later we introduced Bill C-30.
The Fair Rail for Grain Farmers Act has put into law clear and achievable solutions to ensure grain and other commodities get to market in a predictable and timely way. The act amended the Canada Transportation Act to include the authority to set volume requirements in order to mandate that certain grain volumes be moved. The legislation also gives us the ongoing flexibility to monitor and adjust volume requirements as needed. The act also created the regulatory authority to enable the Canadian Transportation Agency to extend inter-switching distances for all commodities on the prairies.
Bill C-30 amended the Canada Grain Act to strengthen contracts between producers and shippers. The amendment will provide the Canadian Grain Commission with the authority to regulate grain contracts between farmers and grain elevators.
Bill C-30 also enacted regulatory power to add greater specificity to service level agreements as requested by all shippers.
In addition, we required additional, timelier and more detailed data from the railways to increase the transparency of railway, port and terminal performance across the supply chain.
In August, the regulations came into force and we renewed the minimum volumes to ensure continued movement through the fall.
In December, we did the same, while committing to increased monitoring throughout the winter months.
These measures are concrete and comprehensive and they have been delivered. The grain is moving faster than last year and faster than the five-year average.
Speaking to the second point of the motion regarding the review of the Canada Transportation Act, this process was up and running in the summer. We accelerated the review by a full year to focus on long-term structural issues affecting all rail transport, including grains.
A discussion paper was released in September for industry comment. Since then, the CTA review panel has been busy throughout the fall and winter, meeting with a number of stakeholders to get a clear picture of the challenges facing the western Canadian grain handling and transportation system.
We will continue to bring the whole value chain together to manage future challenges and create a rail supply chain that has greater capacity, predictability and accountability for the industry and, most important, for our global customers.
As far as urging industry to work together to improve the system is concerned, we have delivered on that as well. We have established a number of opportunities to bring together all the players to develop solutions for the longer term. We have also formed the Crop Logistics Working Group, bringing the entire industry together to focus on the performance of the supply chain for all crops in this new and exciting marketing freedom environment.
We moved forward on recommendations from the working group around performance measurement and government support, with a $3 million industry-government investment in a study on supply chain improvements. We also launched the commodity supply chain table, with stakeholders from the agricultural, forestry, chemical, and petroleum industries, as well as railways, ports, grain elevators, and shipowners. The group is exploring solutions to the challenges facing Canada's rail-based supply chain. Together, these initiatives will ensure that Canada's grain industry can to shape a strong logistics system for the future, one that responds to the needs of the Canadian grain sector.
However, we are not stopping there. This government has an overall plan to create a modern and competitive grain industry that will open up new opportunities for farmers in the 21st century. The cornerstone of our reform is marketing freedom. This landmark legislation restored to farmers a basic business freedom they had been denied for 69 years, the freedom to sell the crop they paid to grow to the buyer of their choice, the same freedom that helped create the canola and pulse industries, which made them juggernauts of Canada's farm economy over the past two decades. The overwhelming majority of western grain farmers have embraced the opportunities opened up by marketing freedom, which allows them to make decisions at the speed of business.
In the post-monopoly era, Canadian wheat is finding new customers in Asia, Africa, and South America, where sales of Canadian wheat in 2013 and 2014 surpassed the previous five-year averages. Meanwhile, instead of one buyer for farmers' wheat, there are now dozens of grain companies competing for their crops, as we saw with the deregulation in Australia. Since marketing freedom came into force, the number of grain dealers licensed by the Canadian Grain Commission has risen significantly.
In December, we took another key step for Canada's grain industry when we introduced BillC-48, the modernization of Canada's grain industry act. This proposed legislation builds on major reforms we made to the Canada Grain Act in 2012. It would modernize the regulatory framework for the grain industry to reflect current practices. It would enhance producer protection and grain quality and safety assurance. Enforcement of the act's provisions would be improved and less burdensome. Efficiencies would be realized in producer protection. This proposed legislation would benefit producers, the grain industry, and all Canadians in a big way.
Trade is also critical to the competitiveness of Canada's grain industry. Internationally, we have continued our aggressive trade agenda by pursuing free trade agreements and ensuring a science-based approach to trade issues, like low-level presence of genetically modified crops. We have concluded major agreements with 38 countries, including the European Union and South Korea, opening up key markets for our producers and processors.
Once the trade agreement with the EU is fully implemented, our grain farmers will have virtually tariff-free access to half a billion consumers from Italy to Scandinavia. To give traction to these trade agreements, the Minister of Agriculture and Agri-Food continues to travel with industry for face-to-face meetings with our customers in key markets. These missions help to promote the qualities of Canadian grains to every corner of the world, while bringing back valuable feedback from our customers to ensure that our grains continue to command a premium in the world.
The other key element in our grain modernization plan is innovation. We are keeping our wheat producers on the leading edge of innovation through investments in the wheat genome and disease-resistant varieties. That includes the national wheat improvement cluster. We have matched funds, bringing in investment up to $25 million. We have dealt with the Western Grain Research Foundation, again bringing all of these things together to help our farmers.
In conclusion, the future is bright for Canada's grain industry. The Food and Agriculture Organization estimates that over the next 35 years, farmers will need to increase their annual production of cereals by a billion tonnes. To meet the world-class demand, they need a world-class transportation system. This government remains committed to ensuring that Canada does, indeed, have a world-class transportation system.
