Proceedings of the Standing Senate Committee on
Agriculture and Forestry
Issue 10 - Evidence
OTTAWA, Tuesday, May 11, 2004
The Standing Senate Committee on Agriculture and Forestry met this day at 5:50 p.m. to examine the issues related to the development and marketing of value-added agricultural, agri-food and forest products, on the domestic and international markets.
Senator Donald H. Oliver (Chairman) in the chair.
[Translation]
The Chairman: Honourable senators, first, before I begin, I would like to welcome honourable senators and observers. I would also like to welcome Canadians who are tuning in via the Internet.
Today, we continue our study of the issues related to the development and marketing, both in Canada and abroad, of value-added agricultural, agri-food and forest products.
[English]
Over the last few weeks, honourable senators, we have listened to various witnesses who have explained to us the issues surrounding the development of marketing in value-added agricultural, agri-food, and forest products. This evening we have invited the Ontario Maple Syrup Producers Association to provide us with an overview of the issues the industry is facing in relation to value-added product opportunities for farmers.
Appearing on behalf of the Ontario Maple Syrup Producers Association is Mr. Mark Wheeler, the past-president and current member of the board of directors. As well, Mr. Wheeler operates the Wheeler Sugar Bush, one of the largest producers in Eastern Ontario, with 13,500 taps located in Lanark County.
I now invite Mr. Wheeler to begin his presentation.
Mr. Mark Wheeler, Member of the Board of Directors, Ontario Maple Syrup Producers Association: I would like to introduce my colleague, Don Dodds, the Provincial Chair of the Research and Technology Transfer Committee for our association. He is also a maple syrup producer from Lanark County. I have prepared a few notes to get the discussion started.
When one thinks of Canada, one thinks of vast wilderness, Mounties, the beaver and maple syrup. In fact, our flag bears the leaf of the Acer saccharum, or the sugar maple. This distinction of maple syrup as a Canadian product is well earned. Maple syrup can only be made in the northeastern United States and southeastern Canada. Canada is by far one of the world's leaders in all to do with maple syrup, from exports to production. In 1998, Canada produced 82 per cent of the world's maple syrup, with the remaining amount made in the United States.
In Ontario, approximately 2,200 maple syrup producers tap more than 1.2 million taps, leading to revenue in excess of $12 million per year. At the high point in the maple syrup industry, actually in 1921, Ontario farmers tapped more than 3 million taps on nearly 20,000 — as opposed to today's 1.2 million — and at that point there were nearly 20,000 farms. Cane sugar, along with urbanization of Canadian society, has been a main reason for this. That being said, there are still well over 3 million — some say close to 12 million — potential taps in Ontario. In an era in which the sustainable management of forests and the importance of good land stewardship, maple syrup farming is a fine example of an environmentally sound economic activity.
When a maple syrup producer speaks of value-added to another maple syrup producer, the assumption is that they are speaking of pure products traditionally derived by the further boiling of maple syrup into pure maple sugar, pure maple butter, pure granulated sugar or maple taffy. These activities are traditionally done on the farm and add a modest amount of value per litre of maple syrup.
As of recent years, value-added has also come to include maple candyfloss, maple jelly, the promotion of recipes that use maple products, and other creative marketing efforts. Retail or farm gate sales of maple products increase a producer's profit margin significantly. Some examples include on-line and direct marketing sales, displays at farmers' markets and shows, and the corporate gift market. Furthermore, maple syrup's history in the lives of Canadians and the sweet smell of fresh maple syrup in the spring draws hundreds of thousands to local sugar bushes for a taste of syrup and maybe a feast of pancakes.
In most cases, Ontario maple syrup production is a supplemental income carried on as part of another primary agricultural activity. Only a handful of farms in Ontario make a majority of their income from their sugaring operations. The average size maple operation in Ontario is a hobby size of 200 taps. The small scale of many operations allows for limited amounts of money for expenditures on quality-control programs such as Hazard Analysis and Critical Control Point, HACCP, equipment upgrades, professional marketing services and advertising. Maple- related research is limited to government-funded projects and small-scale projects by small groups of cooperative farmers.
Few Ontario farmers have the level of production to supply the large orders of product required to make exporting on their own viable. In most cases, producers sell their syrup in bulk drums to larger packers at a much lower price than a retail price would attain. Some producers who have sold small quantities in the U.S. have actually stopped selling because of the increased red tape due to the new U.S. bio-terrorism act.
I welcome your questions.
The Chairman: That is most interesting. Thank you very much.
When I go to study French in Quebec in the spring, we usually go to one of the sugaring offs where we can have the maple taffy and buy a selection of various products. It is a huge retail part of the business. I was interested in two of the things you said. First I would like you to explain why the U.S.'s Bio-Terrorism Act of 2002 changed the way of doing business. Second, I am interested how in the sales of maple products increase a producer's profit margins significantly. In what way, how and how significantly? Can you explain that?
Mr. Wheeler: The new act has had the biggest impact on the smaller producers — by small, I mean sales of under $1,000 per month. As a result of the act, there are extra brokerage fees and the cost of using an agent in the United States. There are extra regulations and professional fees. Finally, maple syrup is a heavy-weight product and is expensive to ship. As a result of all of these factors, one can no longer sell the product at a reasonable price.
There is also the retail price. For example, a four-litre container of maple syrup would retail for about $50. If you package that into smaller specialty containers, you can earn up to $120 or $150 on four litres of syrup. When maple syrup is sold on the bulk market it is sold by the pound, and the price this year works out to about $20 or so per four litres.
The Chairman: That is, for that same four litres, instead of getting $50 you would get about half; is that right?
Mr. Wheeler: Extra. You would get $50, sold in a four-litre can, and around $20 to $25 in a 35-gallon drums.
The Chairman: In your business, do you have a retail outlet? Do you sell the maple syrup and sugar in your outlet?
Mr. Wheeler: Yes.
The Chairman: You value-add right on your farm?
Mr. Wheeler: Yes. The ice storm was a major impact and hurt production levels so we had to ensure we were well diversified. My operation has been diversified to include the pancake meals and the experience with taffy on snow, along with interpretive trails through the sugar bush to increase visitors' awareness of the forest.
The Chairman: What is your biggest profit-maker in the whole chain of the things you do for value-added?
Mr. Wheeler: The pancakes are used to draw people in to purchase our syrup. The maple syrup sales are the biggest money-maker because people purchase the syrup when they have their pancakes. They can enjoy the whole process of seeing how the syrup is made, tasting it on their pancakes, and taking it home to their family and friends.
The Chairman: Does your operation run 12 months of the year?
Mr. Wheeler: Yes. We are the only one that I know of in Ontario that is a 12-month operation. We are fairly close to the capital and so we have a fairly good year-round tourist market about one hour from Ottawa. We keep our trails and our restaurant open, and we are able to retail our syrup year-round.
Senator Fairbairn: I think it is fair to say that when any of us travel anywhere in the world, we pack some little maple syrup treats in our bags. They are hugely appreciated wherever we go. You said that 82 per cent of the world's syrup is made in Canada so it truly is a unique product. Could you tell us which countries purchase that 82 per cent?
Mr. Wheeler: The single largest importer of Canadian maple syrup would definitely be the United States; second are the Pacific Rim countries — Japan and Taiwan; and third are Denmark and Germany where sales are increasing quite rapidly. They are the major importers.
Senator Fairbairn: Does your organization combine with others in its trade promotion abroad or do you do it on your own?
Mr. Don Dodds, Chair, Research and Technology Transfer Committee, Ontario Maple Syrup Producers Association: More than 80 per cent of the syrup that is consumed in Ontario is imported from Quebec. We do not join with anyone because the market is here. We just have to get the product to the market.
Senator Fairbairn: You import syrup from Quebec?
Mr. Dodds: Yes. The consumers in Ontario buy it. Of the syrup consumed in this province, 80 per cent comes from Quebec.
Senator Fairbairn: Why does it not come from Ontario?
Mr. Dodds: We cannot supply the market.
Senator Fairbairn: You said that the main reason for the reduction in the number of taps was cane sugar and the urbanization of Canadian society. Does this tell us that the land where the maple trees are is progressively being turned into subdivisions?
Mr. Wheeler: Yes, to a small extent that is happening. The idea is that each farm in Southern Ontario and Southern Quebec had a sugar bush on it. Those trees are still there along the roads.
Senator Fairbairn: The farmers are no longer there.
Mr. Wheeler: They are busy doing other things and specializing in other areas of the farm. Making maple syrup is hard work.
Mr. Dodds: I have a wee bit of grey hair so perhaps I could relate back to when it happened. I started out to school in the early 1940s. All the farmers along my road had maple syrup as their sugar supply. They processed that into block sugar, which was the favourite in our area, because it was non-perishable. That was the only way they could keep it. They would scrape it onto their porridge and other foods.
Today's society has evolved such that wives and husbands work and they just do not have the time to tap trees. We have 12 million taps in Ontario waiting to be tapped.
Senator Fairbairn: Mr. Wheeler, you mentioned the ice storm. How devastating was that for the sugar bush? Statistically, it was such a frightful and destructive event. How devastating was it for the sugar bush?
Mr. Wheeler: On our farm, immediately after the ice storm because of the stress caused to the trees, we had to reduce our taps and therefore reduce our production by 50 per cent. Six years later, we are still removing trees in the sugar bush that are still dying because of the ice storm. We are not finished with the effects, yet, but when all is said and done, Lanark County and surrounding area were among the hardest hit in respect of damage to the trees. I think that 30 per cent to 40 per cent would be a conservative estimate of the tap reductions.
Senator Fairbairn: I wanted to get that information from you because I was quite shocked this year when winter came upon us that it was so difficult to find firewood for sale. People wondered why the supply of firewood was so low. I guess so many trees had been destroyed by that storm and the young trees were still not mature enough for cutting. Such a storm has long-term effects on industries that rely on forests.
Mr. Wheeler: Absolutely. I sell a little bit of firewood on the side. We log, cut and split firewood for customers. During the ice storm, there was a great deal of firewood on the market because people were cleaning out their backyards and acreage. There was a generous supply of free firewood around. Many people added fireplaces into their homes for fear of future ice storms. It is good to have wood as a heat source when the electricity fails. The forest industry and logging in general are feeling the impact of the higher oil and gas prices. Many people are turning to wood because it is a cheaper source than gas and oil. Those two factors combined have made the situation as difficult as for someone wanting to purchase firewood.
Senator Hubley: This is an interesting subject. We all have a sweet tooth and, certainly, maple syrup is right up there. I am interested in the amount of research on product enhancement or development of new products. You mentioned a few things that you developed recently: maple candyfloss, maple jelly, recipes, and so on.
Research is an important catalyst for innovation and adding value to products, either through increased production yields or the development of new products or new product uses. Who is doing the research for the maple syrup industry? Where is that being done?
I wonder if you might elaborate on a comment in your presentation that maple-related research is limited to government-funded projects — would you give us an idea what those are? — and small-scale products by small groups of farmers. What kind of research would be taking place there?
Mr. Dodds: There have a lot of ongoing research. Dr. Tom Noland, from eastern Ontario, is conducting a major study on the impact of the ice storm. It began on last fall and is continuing this spring. We hope to have the results for our July annual meeting.
The only way we can study the impact of the ice storm is to measure tree health, and tree health is measured by the starch stored in the root. We can look at all other things, but the best indicator we have is starch levels in the root. I should know where the funding is coming from. I do know that Dr. Noland applied for funding in specific areas. OMSPA, the Ontario Maple Syrup Producers Association, came up with some money and, at the field level, 15 farms are contributing their bush and whatever he would need.
In the value-added field, I would have to admit that OMSPA has been lazy. We have been trying to deal with other serious factors. If you have looked at the CFIA Web site lately, you see some information on lead-contaminated syrup. We want to produce the safest syrup in the world in Ontario, and we are taking this one on head first, at the expense of some of the research.
The Chairman: Where would the lead contamination come from?
Mr. Dodds: The lead is leached out from many sources — anywhere from the old galvanized spout to the bucket to the tank in which it is stored in to the pans where it is boiled, if they has been soldered with lead solder. Sap is slightly acidic. You may not think that when you eat it. Syrup is acidic also. Because it is slightly acidic, it leaches it out of there. The present level as set by the provincial government is 0.5 parts per million. The one on the Web site in the last two or three days is, who knows? I do not know what it is, but it is above that. They do not usually get posted there unless they are over 1.0 something.
We have major research projects in Ontario on lead. We strategically picked 15 producers, and they sent in samples of their syrup. The first run-off of syrup every morning and the last run-off every night was put in the freezer, stored, picked up by Ontario Ministry of Agriculture and Food, OMAF, and taken to a lab for testing. We expect to have those results next Monday. They will be interested to see how we approach this lead problem in Ontario.
Tragically, I guess, the small producer with between 200 and 300 taps, who has no other revenue and cannot afford to diversify to make more money, is making it difficult for all the large producers, because of the image of maple. We will certainly be knocking on some doors for some incentive to clean that up and make it a health safe product. Our first goal is to make maple syrup safe for young children. Lead is cumulative over a lifetime. We do not want problems.
Who is doing the research? The major research in Canada is done at the ACER Centre in Quebec. We work jointly with them on some projects and separately on others. Our big problem is that we do not have the money to translate the good research they do into English for the Ontario producer and vice versa. We do some good research. It is a difficult problem.
Senator Hubley: In respect of this lead situation, what sort of steps have you had to take and what impact has that had on your overall industry? Have you changed the way you make your maple syrup, or have you had to replace the containers that contain lead with other containers?
Mr. Dodds: About three years ago, Mr. Wheeler and I went across the province conducting best management practices workshops. We told people not to leave their sap in the bucket for a long time so the lead would leach out. We explained that they had to get it out of there quickly. We also told them that they had to dump the sap if it sat there for two or three days. It could not be processed Those workshops were well-received. Lead testing continued. Some of them cleared right up; some did not.
OMAF continued to sample those people whose products tested above the lead level. Many of them cleaned up because of good management practices. Those who did not will have to replace their equipment. That is the only solution. It is leaching out. They have done the management, so it is now a financial problem that has to be dealt with by them.
Most producers, like the Wheelers and ourselves, have gone to new equipment with no solder, something called TIG welding, which is tungsten inert gas, if that means anything to anyone. It is just welded. There is no solder and there is no possibility of lead getting into the food product.
The Ontario Maple Syrup Producers Association also has put in a Seal of Quality Programme. You may be familiar with it. If not, you can find details at the Web site. It is a quality control program, which requires members to have three different batches of their syrup tested for lead. If lead levels are above the threshold, which is 0.5 per million, you cannot sell as seal of quality syrup.
Canada has different rules from our neighbours in Vermont. In Vermont, you can blend contaminated syrup and non-contaminated syrup until you get the lead level down. In Canada, it is illegal to blend contaminated products. The Ontario Maple Syrup Producers Association endorses that. We feel the only solution is to get rid of the contaminating equipment.
The Chairman: Are your regulations provincial or are some county?
Mr. Dodds: Our regulations are provincial, which really endorse the federal standards. Provincially, we do not have many standards. We have just said that whatever the federal regulations are, they apply in Ontario. That has even got us to a problem that now when we grade a syrup, we say Canada number one, extra light, and that is protected by trademark. We will not be able to do that after January 1.
Mr. Wheeler: The Seal of Quality Programme began as an industry initiative the year of the ice storm — about six years ago. The association recognized that the weakest link is the weakest link in the whole industry. One of the biggest challenges that we do face is that the biggest percentage of our operations is small, hobby operations with little to invest in their quality control programs. You can have the biggest, shiniest maple syrup producers making high quality syrup. Yet if one has a product that goes to class-one recall, advertised all over the newspapers and television, the entire industry suffers because people's perception of maple syrup as a safe product would be hurt.
The Seal of Quality Programme was put together with a set of best management practices for maple syrup. It is a voluntary program. Out of the 2,200 producers in Ontario, just over 100 members. It should also be noted that these 100 and some producers would represent a fairly high percentage of the Ontario maple syrup available, because they are the larger operations.
The Chairman: Are they able to put an indication on their label so that you know you are getting the best? If so, what is that indication? In wine it is VQA. What is it in maple syrup?
Mr. Wheeler: It is the Ontario Maple Syrup Seal Of Quality sticker.
The Chairman: When that is there, that is the guarantee?
Mr. Wheeler: Yes. We were able to obtain funding through the Agriculture Adaptation Council's CanAdapt program to help implement this project and pay for some marketing projects to promote the Seal of Quality and what that means. However, that funding dried up three years ago.
The Chairman: During the ice storm, when you had all the problems for production in Canada, was it possible for the blended Vermont syrup to be sold in Canada then, and can it be sold here now?
Mr. Wheeler: It is a difficult question to answer. It can be.
Mr. Dodds: I do not know how many. Vermont syrup is sold in Perth, right in the heart of the maple capital of Ontario, so it hurts us. Yes, it is here. Do I know if it is blended? I have no idea. We would not know the lead levels that would be in it. I am sure OMSPA does because last year they tested more than 400 Ontario producers. I am sure they picked off a few of those Vermont producers.
Senator Mercer: As a fellow who grew up in the city, I look forward to joining the Standing Senate Committee on Agriculture and Forestry to learn some things. I thought I was finally going to get an industry without problems, but you people have rained on my parade.
I recognize that Ontario only produces 4 per cent of maple syrup production in Canada, where Quebec produces 93 per cent, New Brunswick produces 3 per cent, and there is .02 per cent from the other provinces. I represent people in that .02 per cent from Nova Scotia.
In my research, I was quite impressed to find we have 70 maple producers with more than 300,000 taps, which is only about 10 per cent of the 36,000 acres of good producing maple trees in our province. When we say .02 per cent, it sounds small; but when we put in the fact we do 140,000 litres of maple syrup, that starts to be more significant. With respect to the Ontario importation of Quebec syrup is, is it also imported from other provinces such as Nova Scotia and New Brunswick?
Mr. Dodds: Yes. Delta Foods has signed a major contract with producers in northern New Brunswick. They bring it in by the tractor-trailer load into a little town called Tin Cap, just above Brockville. That is where they process it and make it into whatever, and sell it all across the U.S. as President's Choice.
The Chairman: Oh my.
Mr. Dodds: They ship to Norway in big blocks of sugar where they add water back to it and make it into syrup over there. That is the cheapest way of shipping it across. As far as Nova Scotia is concerned, I cannot answer whether we import to Ontario — I doubt it. It must have enough or a market — Peggy's Cove would use up that much, would it not?
Senator Mercer: We sell little bottles there. I want to talk about value-added. That is where Nova Scotia does come in. While we only produce, I think it was 140,000 litres, we produce the other important thing that go with the maple syrup. Oxford, Nova Scotia is the blueberry capital of Canada. We produce the blueberries to go in those pancakes that the maple syrup covers. I am looking for a way to tie our product sales together.
I was interested to hear Mr. Wheeler talk about selling his product. I notice that your company does not sell your products by mail order, but your products are available by mail from the Balderson cheese stores. However, because of new U.S. border regulations, Balderson cheese is no longer shipped across the border or is limited, is that right?
Mr. Wheeler: That is right. Because of a number of factors, Balderson cheese has decided it is no longer worth the hassle because it is no longer commercially viable for them to ship it anymore. They have enough business domestically.
Senator Mercer: One theme that I would like to discuss is quality control. We talked about that when we talked about wine and beef. You have raised the issue of lead. This is a problem of quality control.
The North American Maple Syrup Council gives about five awards each year. I understand that three of those awards were won this past year by Nova Scotia farmers. Indeed, a friend of mine's father, Avard Bentley in Westchester-Cumberland County, Nova Scotia, won two of them. That is pretty significant for a small piece of the pie, that we are building quality.
In these awards, I am hoping that you will tell me that it is based on not only the great taste and the production costs, et cetera, but you will also tell me it is a low-lead contaminant as well.
Mr. Dodds: There certainly would not be any lead testing done at that level. I think the fact that your region hosted the North American Maple Syrup Council meeting might indicate there would be quite a few entries from that locale that year, where people from Ontario may not have entered. That is the only reason I can see that we would not win it.
Senator Mercer: I will allow you to say that. I do not know if I agree with you on that.
The Chairman: Did you want to add something, Mr. Wheeler?
Mr. Wheeler: That type of competition is based on colour, flavour and appearance.
Senator Mercer: To follow up Senator Oliver's comment on the Seal of Quality sticker, I think that this is something that is worth pursuing here. If we have maple syrup in the marketplace that is coming from Vermont that is blended with a product that has some lead contaminants in it, we should be able to rise above that by promoting the Seal of Quality.
However, I am concerned about the Seal of Quality Programme. You say that only about 100 producers out of 2,200 in Ontario are members. Is this a program that is restricted to Ontario, and if so, why?
Mr. Wheeler: This was a project that was undertaken in Ontario. There is a project in Quebec, just launched last spring, called Syrup Pro, which is largely modelled on the Ontario Seal of Quality Programme. There are a lot of parallels between the two programs. There is nothing really significant that stands out different; I suppose the only difference is the name.
Senator Mercer: I go back to a discussion I have had at a number of these meetings where we have talked about value-added. In my province, we have a group called ``Taste of Nova Scotia,'' which brings together quality products from all parts of the agricultural industry and fishing. We present our best fish, beef, fruit, pies, blueberries, wine and so forth — all the products produced in Nova Scotia. It seems that perhaps that we should try to raise the level of security from the consumers' points of view.
Canada — whether Nova Scotia, Ontario, Quebec or New Brunswick — produces the best maple syrup in the world. Is there movement within the industry to come together and then to ask the federal government to help establish standards that will raise us above this?
Your comment was that somebody will make a mistake and put a maple syrup product on the market where the lead level is too high and some disaster will happen that affect everyone. Why not prepare for it in advance? I am tired of us talking about crises that are now before us. This might be one we could avoid.
Mr. Wheeler: There is a federal quality program, administered by the Canadian Food Inspection Agency, CFIA. It is simply federal registration. For a maple syrup operation, federal registration means that once a year a CFIA inspector visits your operation and determines whether you are meeting all the best management practices criteria. They take several samples of maple syrup to test it for lead, paraformaldehyde and adulteration. Adulteration is, say, mixing your syrup with cane sugar or some other sweetener to make cheap fake syrup. They test all of those things.
When you test that, by law you must put a grade sticker on your syrup container which is a little label that says ``Canada number 1'' or ``Canada number 2.'' The grades are extra light, light and medium.
Senator Mercer: What do ``one'' and ``two'' mean?
Mr. Wheeler: Canada number 1 is the higher quality. Canada number 2 is an amber colour — more of a cooking grade maple syrup.
The Chairman: Is number 3 dark?
Mr. Wheeler: Number 3 is dark and cannot be sold to stores.
The Chairman: Can it be sold commercially?
Mr. Wheeler: It is commercial use only.
Senator Callbeck: I would like to discuss the demand for maple syrup. You can sell all you produce; is that right? Is there a big demand for it?
Mr. Wheeler: In Ontario it is easy. In Ontario for the most part you can sell what you produce. In Quebec, they carry large surpluses from year to year because of the large production in Quebec.
Senator Callbeck: Is there a problem selling in Quebec; do you need more markets?
Mr. Wheeler: That is right.
Senator Callbeck: Does the price change very much?
Mr. Wheeler: There was no change this year from last year. There was a fluctuation in the year of the ice storm. Whenever you have a bad year, yes, it can change, but not drastically.
Senator Callbeck: You mentioned that most of it going to the market in the United States. You also mentioned Japan, Taiwan, Denmark and Germany. How did you develop those markets?
Mr. Wheeler: The large packers developed those markets. When I talk about maple syrup producers selling bulk syrup, they sell in 30- or 40-gallon drums to the packers. In Ontario, there are at least three. In Quebec, there are several more. These large packers are the ones who would sell your brand name, specialty packaged products, to the grocery stores — the Hungarian specialty food chain, for example.
For the most part, these are not farm operations, but large-scale, commercial packing operations in industrial parks. They are buying syrup from hundreds of producers and packaging it on their own packaging line. They would participate with overseas trade fairs.
Quebec has had federally funded marketing initiatives to help promote those markets. In some cases, it actually involves going over there and establishing the market. Marketing maple syrup in Canada is easy — all Canadians know what maple syrup is. The international markets have only begun to open up in the past couple of years. There is a challenge in selling a product on a continent that never has been, or will be, able to make maple syrup. First they have to understand exactly what it is. That is probably the biggest challenge for maple syrup internationally.
Senator Callbeck: You say this in the last two years. Have they increased every year?
Mr. Wheeler: Yes.
Senator Callbeck: Is that a large increase or just a small increase?
Mr. Wheeler: I do not have those numbers offhand. You could probably obtain those from the Quebec federation.
Senator Callbeck: What are the main things that the federal government can do to help your industry? Is it in the opening of the markets? Is it in research?
Mr. Wheeler: Something we have not talked about yet, but many maple syrup producers are frightened of the Asian long-horn beetle. I do not know if you have heard about that. It is getting away from value-added. One of the biggest concerns of the maple producers is that the Asian long-horned beetle does not get out of Toronto and it is contained. If the Asian long-horned beetle does get into the hardwood forests, the maple syrup industry will be eliminated completely. We will not have to worry about value-added or marketing if there are no maple trees.
On the subject of marketing, we would undoubtedly benefit from international marketing efforts on a broad scale: raising awareness of the product and working with industry associations. Many projects thus far have been provincial in nature. You mentioned Taste of Nova Scotia; perhaps a ``Taste of Canada'' would help benefit all producers in the country.
Senator Callbeck: Have we never had an effort like this?
Mr. Wheeler: Not to my knowledge.
Mr. Dodds: There have not been any joint efforts.
They have taken the first step. The first step is trying to come up with a uniform grading system across North America. If you buy syrup in Japan, and it says ``Canada number 1, extra light,'' what do you compare that with in Vermont? In Vermont it is ``fancy.'' If you go into another state, it is a different name. We have to eliminate that confusion.
Perhaps you could support our efforts in doing that. I do not know if we will ever get there. We have spent two years at that. We have not made great strides forward yet. Vermont is the second largest producer of maple syrup in the world and does not want to give up their identity either. ``Fancy'' is the top quality, and what we call ``light'' under Ontarian and Canadian certification would be called ``light amber'' in Vermont. What they call ``medium amber'' we call ``medium.'' We need uniform standards for light transmittance levels so that consumers know what they are getting. The key would be for the federal government to initiate having the four provinces work together. When provinces each do their own thing, it does not solve the overall problems.
We need to add value in order to get diversity and ensure that young people can stay on the farm and make a living without government support programs in the future. I believe that we should be moving toward value-added, although I do not think that many maple producers in this country share that view. If we do not go in that direction, I do not think our money will be well spent. We must get all provinces working together.
Last year, New Brunswick passed us in production. We dropped to third place one year ago. However, Ontario had a better year this past year and, except in northern New Brunswick, they had a poor year. We are back in second place.
Senator Callbeck: You mentioned four provinces. The fourth is Nova Scotia, is it?
Mr. Dodds: Yes.
Mr. Wheeler: Prince Edward Island makes some too.
Senator Callbeck: That is where I come from. I read here that there are 10 maple farms.
Mr. Dodds: You would not want to tap the beautiful bird's eye maple trees.
The Chairman: I have five or six brief questions. You mentioned that one province had a bad year. As I understand it, you need cold nights and hot days to produce syrup. What was the weather like for Ontario this year? Did you have cold enough nights and warm enough days to cause the sap to rise?
Mr. Wheeler: Yes, the season was good in Ontario for that. We want warm days and cool nights, but it hurts the season when it gets hot for extended periods of time. If it does not freeze at night for any more than four or five days, you would start to get worried. When the weather gets hotter, the quality goes down.
The Chairman: How old does a tree have to be before you can begin to tap it?
Mr. Wheeler: Approximately 40 years old, which makes it about 10 inches in diameter.
The Chairman: As growers, are either of you on any subsidies whatsoever — government grants, supports or anything — to support your price?
Mr. Wheeler: I am not aware of any programs in southern Ontario. After the ice storm, there was help to clean up our forests. I know that FedNor in northern Ontario does assist some producers.
The Chairman: In terms of grade and quality, could you tell us again about colour? What does the customer want, and are you allowed to use colouring to lighten it or darken the syrup?
Mr. Dodds: No. The key is ``pure.'' The words ``pure maple syrup'' mean no additives of any type.
Colour preference is just like cheese. Some people like mild; some people like old. Some people like amber; some people like extra light. It is probably depends what you experienced as a child. If you had Aunt Jemima, you will prefer amber. If you were on a farm and got some extra light, which, to me, is the true flavour of maple, because it has not had a lot of active bacteria, you would like the extra light flavour. There is no answer to that question. Thank goodness that some people like each grade. That is how we get rid of all our grades.
The Chairman: You mentioned that there is a big problem with the labelling language between Canada and the United States. The Christmas tree industry has the same problem. They talk about ``fancy,'' ``choice'' and ``select'' while other people talk about ``premium,'' et cetera. There are three different languages used to describe the grade and quality of trees, and for most people it is terribly confusing. Others and myself have tried to have that clarified. It is not easy to change because people are wedded to their old-fashioned language.
Senator Callbeck asked a good question about what is required from government. I heard from you that there are a lot of more-than-40-year-old sugar maple trees in Ontario that are not being tapped. Is there any merit in a program to get people back to the market? The demand is stronger than the supply, if in fact more than 80 per cent of the maple products consumed in Ontario come from Quebec. Is there any merit in tapping some of the maple trees that are not being tapped?
Mr. Wheeler: Yes, without a doubt.
The Chairman: What would it take to do it?
Mr. Wheeler: In some cases, these maple trees are standing on Crown or county forests that are, in some cases, out of the hands of private business. Some land adjacent to our property is owned by the county, which has no policy on leasing their trees, so those trees sit idle. The county stops that from happening.
The Chairman: In terms of a business, they represent the inventory. A 50-year-old sugar maple tree in perfect condition is ready to be tapped. If you could get a reasonable lease on a few acres, it is a ready-made business. You tap it, put a line in and sell the processed product. It seems to me that it is a business waiting to happen.
Mr. Wheeler: Absolutely. We have had some problems in the last three months in Ontario. The province's Municipal Property Assessment Corporation decided to tax maple sugar camps where the syrup is made as industrial as opposed to farm. The industrial tax rate was increased 17-fold in most cases. That has been kind of a silencer in the last few months in Ontario. We hope that has been dealt with and that decision has been turned around.
We face the same thing with value-added. They would still like to call value-added activities ``industrial'' for property tax purposes, calling making maple sugar and maple butter industrial rather than a farming operation.
The Chairman: It is insofar as you have to follow HACCP though in your productivity.
Mr. Wheeler: At this point HACCP is out of the reach of pretty well every maple syrup producer that I know of in respect of the cost for the program and the size of our maple syrup industry.
Senator Fairbairn: I have a question that flows from other testimony we have head, including that from representatives from the organic farming community in Canada. Pulse Canada suggested that it would be a good thing for Agriculture Canada to bring all commodity groups together to develop a comprehensive agricultural research framework. It would look not only at value-added processing, but also at production and marketing systems, et cetera.
Would you industry embrace something like that?
Mr. Wheeler: I do not see why not. I do not see how you can go wrong with cooperation.
Senator Fairbairn: It might be useful to gather these smaller industries together to talk about marketing products under a broader umbrella.
With your products, what is the biggest draw? Is it the syrup? What about the candies and those kinds of things? Is the syrup your biggest draw?
Mr. Dodds: At our little camp, we have only 2,500 trees, and maple syrup is our biggest. We want to be very clear: We do not make candy. We make maple butter spread; we make hard sugar and the soft sugar that you call ``candy.'' If we made candy, we would have to charge PST on it, and we would be industrial. We have to be careful. We make granulated sugar, which looks exactly like brown sugar. We ship a lot of that to B.C. at our operation, and we get somewhere about $140 per gallon by processing it to that point.
Certainly, at other camps, syrup is key. If I go to a pancake house, I am going for atmosphere and many more things than the maple syrup. I go as a consumer. Sometimes you go for entertainment. They have entertainment there as well. You go for that. However, ultimately, I buy maple syrup no matter where I go.
Mr. Wheeler: The thing about maple syrup is that there are maple products. Maple syrup is a maple product. The only difference between maple syrup, maple sugar and maple butter is the sugar content.
Senator Fairbairn: Which has the lowest?
Mr. Wheeler: Maple syrup is 66 per cent sugar content, whereas pure maple sugar is close to 100 per cent pure sugar. As you can imagine, 100 per cent pure sugar is quite sweet.
Mr. Wheeler: If you are cooking with maple syrup, you still get the maple flavour whether you use maple sugar or syrup. I find that most people will just use their maple syrup because it is more multi-purpose.
Senator Mercer: When you said that you do no make ``candy,'' I thought perhaps we had found the perfect marketing tool: something that is not candy, but is that sweet.
Senator Oliver made it all sound so simple: there are all these trees out there that need to be tapped; we have a marketplace that we are not exporting much nor are we driving our exports because we are consuming most of our produce here in Canada. I look at the statistics for my own province where we were only tapping 10 per cent of the 36,000 acres of good producing maple sugar trees in our province. We are just a little province compared with Quebec, Ontario or New Brunswick.
However, I do not think it is that simple. How do we get more people into the business? How do we get people who are in the business to expand their operation and their production? In some cases, it would mean you would have to acquire new land, but if I read what people are telling me correctly, you, as a producer, are not tapping all your trees anyway. How do we get you to tap more trees to produce more maple syrup, and more of that ``non-fattening'' product that some people call ``candy?''
How do we get more people in the business? The one thing we still have a great deal of in this country, even with large urbanization, is land and trees, and a lot of land that probably would be suitable for sugar bush operations.
Mr. Wheeler: You could ask that same question of any other farming business in Canada. Probably a lot of farm owners are feeling that they are overworked and underpaid.
The Chairman: It is return on investment. That is why we are studying value-added to find a way to return more value to the farm gate.
Senator Mercer: You have to have a 40-year-old tree to start tapping. It seems to me that to have a 40-year-old tree, someone has had to own that land for 40 years. That is a significant investment to make when you are looking for return. I do not think you plant trees to tap them unless you have a very large piece of land that is not being used. It is not like Christmas trees where you can grow and harvest long before it is 40 years old.
Mr. Dodds: I just planted a partial orchard this spring and plan to plant for the next three years.
Senator Mercer: You are going to plant for three years, but you will not be around to harvest these trees.
Mr. Dodds: My granddaughter might be. There are many maple orchards in Ontario. You would be surprised at the number of producers who are taking marginal or low-quality farmland and planting them with maple.
That is a future investment. You are looking at two guys fighting the reclassification of tax issue with the provincial government at the present time. We are trying to convince them that if we plant maple orchards there will be a reasonable expectation of profit in the future from that investment, and we know it is 35 to 40 years away.
Senator Mercer: Is there a possibility that we could develop technology through research that would allow the trees to be tapped earlier than the 40 years, which would make the return on investment faster and more profitable?
Mr. Dodds: I think tree growth is predetermined by genetics and climate. Not to say anything about our neighbours, but in Quebec the trees are smaller than in southern Ontario. That is because of the differences in the climate and the length of the growing season and so on. I do not think there is anything to do there.
We can do a lot of research into what we call ``sweet'' maple — in other words, plant only the trees that produce sweeter, higher sugar content maples. That would be an initiative well worth supporting. I had a tree that gave me 13 per cent sugar. I used to brag about it until I brought a scientist in from Sault Ste. Marie. I thought, ``This is worth telling everybody about.'' He said, ``You should not tell anybody. That tree is under stress. It is dying and will not be there in two or three years.'' On average, in our bush this year, we were getting upwards to 4 per cent sugar, but a lot of trees are giving us only 1.5 per cent sugar. We need to eliminate them.
Senator Mercer: How do you relieve the stress? Do you give it a year off?
Mr. Dodds: Stress is caused by salt from the road. There is no cure.
The Chairman: Is your industry in any way subject to or limited by interprovincial trade barriers? Earlier you told us that most of the maple products consumed in Ontario come from the province of Quebec. I take it that there are no interprovincial boundaries or barriers that prevent the flow of those goods back and forth.
Could you, if you have the products, sell your Ontario products in Quebec without difficulty or without provincial barriers?
Mr. Dodds: Do you mean other than financial difficulty? For quite a few years, Quebec producers got a subsidy to tap trees, so they were able to beat us out on the price of syrup. Our costs are quite a bit higher in Ontario because we did not get that. I think it ranged anywhere from $1.50 to $3 per tap.
The Chairman: Mr. Wheeler, Mr. Dodds, on behalf of the committee, I want to thank you very much. Your dissertation has been stimulating, interesting and very informative. It goes right to the root of what we are studying. We are saying, ``What can you do with a raw product such as sap, and how can you add value at the farm?''
Mr. Wheeler, you are using raw sap, making sugar and syrup, you have your own store and you make your own pancakes — you are doing the whole chain. That is one of the messages that we can give to other farmers for ways of keeping more of the value at the farm gate.
You are also involved internationally in selling your product, and that is also exciting for us in our study. Thank you for sharing your business.
The committee adjourned.