Mr. Chair, this is my first opportunity to address the House of Commons as the member for the new constituency of Lanark—Frontenac—Lennox and Addington. On some other occasion, I will take the opportunity to acquaint the House with the many charms of this beautiful and historic district, which stretches from the western edge of the city of Ottawa all the way down to Lake Ontario west of Kingston and fills all the shield country and the farmland in between.
However, tonight let me simply say that Lanark—Frontenac—Lennox and Addington is cattle country.
In an inventory taken in January 2003 it was reported that there were 24,950 head of cattle in Lennox and Addington County, 26,550 head in Frontenac County and 31,650 in Lanark County. All told, that is over 83,000 head of cattle, which is to say there are more cattle than voters where I come from. That is leaving aside the sheep industry which is also strong in the counties that I represent.
As we can imagine, people were paying close attention on that day, 18 months ago, May 20, 2003 to be exact, when a single case of BSE was reported 1,500 miles away in Alberta and the U.S. border slammed shut to the export of ruminants. Six days later Parliament held its first emergency debate on BSE. However, in the 18 months between that emergency debate and the one we are having tonight, the government's lack of action has ensured that the situation has grown much worse for thousands of rural men, women and children across Canada.
The BSE crisis has been a direct blow not only to our beef farmers but to our rural economy as a whole. Border closings have cost the beef industry in rural communities more than $6 billion and close to 5,000 jobs. In Ontario alone the crisis is costing the beef industry $11 million a week when we factor in losses to support industries such as sale barns, livestock transporters and so on.
Beef used to be a $1.2 billion a year industry in my province. In 2002, which is the last full calendar year for which we have statistics before the border shut, Ontario beef exports to the United States were valued at $292 million in beef product and $354 million in live cattle.
That last number is significant because not one penny of that $354 million has been restored through the partial reopening of the U.S. border to boxed and processed Canadian beef. Because we lack the capacity to slaughter and process that beef here in Ontario, we cannot even fully supply Canadian tables with Canadian beef.
My remarks in this debate will focus primarily upon the absence of domestic processing capacity and what we can do to correct this problem. However, first I will focus for a moment on the cavalier overall approach that the Liberal government has taken to the macro problem of getting the U.S. border to reopen.
Throughout the crisis it has been obvious that the only complete solution to Canada's oversupply problem would be to reopen the Canada-U.S. border. That requires the cooperation of the executive branch of the United States government; in other words the cooperation of the Bush administration. Only direct intervention at the level of the Prime Minister himself could have caused the President over the course of the past year to take the measures necessary to stop his administration from engaging in what has long since ceased to be an exercise in protecting the American food supply and has become a textbook example of protectionism.
Instead, any capital that Canada might have had to encourage the President to use up some of his own domestic political capital by taking on the supporters of protectionism within Congress and within his own administration was squandered by the anti-American grandstanding that has been engaged in by persons in the Canadian government, as prominent as former prime ministerial press secretary Francie Ducros who called President Bush a moron, by the hon. member for Mississauga—Erindale who referred to all Americans as bastards, and indeed, by the former Prime Minister Jean Chrétien himself who held a press conference to explain just how badly President Bush was managing the domestic American economy.
Therefore, by attacking and belittling the Americans gratuitously, the Liberals have frittered away our capacity to get tough in trade negotiations. If the current Prime Minister were really serious when he promised to improve Canadian-American relations, he would not continue to tolerate these kinds of outbursts in his caucus in the House.
I might add that he promised, and this was during the election coincidentally, that he would have the border reopened by the end of summer. Summer has come and gone. A further four months have passed and here we are having another emergency debate with the entirely realistic possibility before us that the border will remain shut to live exports well into 2005.
By now more than half of the period that the border has been closed to live beef exports has been under the watch of the current Prime Minister. So much for his self-proclaimed capacity to establish closer links between Canada and the United States after the exit of Jean Chrétien from the political scene.
I will turn now to the need for increased domestic slaughter capacity with a focus on my home province of Ontario.
Over a year ago, during the first summer of the border closing, I started a program to distribute bumper stickers and signs with the message “Ask if it's Canadian beef”. With the help of many enthusiastic volunteers, we distributed quite literally thousands of these across the rural areas that I represented and far beyond. I set up a website, www.buycanadianbeef.com, and we ran a newspaper advertising campaign that continues to this date.
What good is it for Canadian consumers to increase the consumption if they cannot purchase Canadian product? If we do not expand our domestic slaughter capacity so that we can service both domestic and foreign product, no amount of demand for beef will reduce this country's oversupply.
Over the past 30 years there has been a 50% decline in Ontario's federally inspected processing capacity from 1,089,000 head in 1978 to 544,000 head in 2002. Between 1992 and 2002 alone, those would be the years when the Liberals governed Canada, the number of federally inspected slaughter plants in Canada dropped from 73 to 31 and in Ontario from 11 to 6. The most obvious result of this decline in slaughter and processing capacity has been an increase in exports of live cattle to the United States over the last 15 years. From 1987 to 2002, total Canadian exports of live cattle rose from 197,000 head to 1,539,000 head.
In 2003, according to the president of the Grenville Cattlemen's Association, which represents producers in a county just southeast of the one that I represent, 90% of the cow calves from our region of Ontario were going to Pennsylvania for processing before the border was shut.
This increase in processing capacity is necessary not only for Ontario beef producers, including cull cows, but for other ruminant producers as well. Ontario sheep producers in particular have been calling for an increase in processing capacity in our province.
If processing capacity in Ontario were to expand, it would also allow farmers to sell not just a primary commodity but a value added product. This particularly would be the case if we were to provide a regulatory environment that is friendly to small scale processing plants and suitable to the needs of small scale and specialized producers of high value beef and lamb. Organic producers come to mind as an ideal example of value added producers who could benefit from an increase in small scale processing.
Perhaps the most important benefit of an increase in domestic slaughter capacity would be the assurance that it would provide for the future of our industry. One frightening scenario is that the border might reopen to live exports in January 2005 and then on the basis of a single new case of BSE snap shut again in June or July, starting the whole cycle of loss and despair all over again. As long as this is a realistic possibility, the inherent value of the Canadian herd will be greatly reduced, as will be the capacity of Canadian producers to find financing for their beef production activities.
An industry that is hamstrung in its ability to access capital is an industry that will find it difficult to modernize and expand, which it must do if Canadian beef producers are to remain the most efficient in the world.
