Proceedings of the Standing Senate Committee on
Agriculture and Forestry
Issue 3 - Evidence - Meeting of October 27, 2011
OTTAWA, Thursday, October 27, 2011
The Standing Senate Committee on Agriculture and Forestry met this day at
8:04 a.m. to examine and report on research and innovation efforts in the
agricultural sector (topic: Innovation in the agriculture and agri-food
sector from the producers' perspective).
Senator Percy Mockler (Chair) in the chair.
The Chair: Good morning; I declare the meeting in session.
I would like to welcome everyone to the Standing Senate Committee on
Agriculture and Forestry.
My name is Percy Mockler, and I am a senator from New Brunswick and the
chair of the committee. At this time, I would ask all other senators,
starting on my left, to introduce themselves.
Senator Mercer: Senator Terry Mercer, from Nova Scotia.
Senator Robichaud: Fernand Robichaud.
Senator Fairbairn: Joyce Fairbairn, from Lethbridge, Alberta.
Senator Mahovlich: Frank Mahovlich, from Ontario.
Senator Plett: Don Plett, from Landmark, Manitoba.
Senator Eaton: Nicole Eaton, from Toronto, Ontario.
Senator Rivard: Michel Rivard, Laurentides, Quebec.
The Chair: I thank the witnesses for accepting our invitation to
share with us and all Canadians their knowledge and views of the farming
community that they represent. No doubt they have taken into consideration
the committee's order of reference. A report on developing new markets
domestically and internationally, enhancing agricultural sustainability and
improving food diversity and security will be presented to the Senate.
The purpose of today's meeting is to gain an understanding of innovation
in the agricultural and agri-food sector, while taking into account the
perspectives of farm producers themselves.
We have, from the Canadian Produce Marketing Association, Ron Lemaire,
President; and Jane Proctor, Vice President, Policy and Issues Management.
We also have with us the Executive Vice-President of the Canadian
Horticultural Council, Anne Fowlie.
I am informed by the clerk of the committee that the first witness to
present is Mr. Lemaire, followed by Ms. Fowlie. Following presentations,
senators will ask questions. Mr. Lemaire, please proceed.
Ron Lemaire, President, Canadian Produce Marketing Association:
Honourable committee members of the Standing Senate Committee on Agriculture
and Forestry, on behalf of the Canadian Produce Marketing Association, I
thank you for the opportunity to present today.
The Canadian fresh fruit and vegetable market contributes approximately
$5 billion in measurable economic activity in Canada and provides direct
employment for over 90,000 Canadians across the country. The CPMA is a
not-for-profit association that has represented the interests of the fresh
fruit and vegetable trade in Canada for the past 87 years. Supporting a
vertically integrated supply chain, we represent over 770 companies from
farm gate to dinner plate — in other words, growers and shippers to food
retailers, food service and most everyone in between. As an example, members
include Prince Edward Island Potatoes, BC Tree Fruits, Loblaws, Metro, Sysco
and Gordon Food Service. Within our membership, CPMA represents the
interests of 456 Canadian companies, including over 150 Canadian growers,
shippers and packers. This diversified Canadian membership provides CPMA
with a unique perspective on the issues and challenges facing Canadian
agriculture at both the primary production and market levels.
While no single solution or magic bullet will solve the long-standing or
historical challenges faced by the fresh fruit and vegetable market, we need
to look to new policy and economic models that will support Canadian
companies to be more competitive both domestically and internationally. On
this, I would like to focus quickly on some identified areas of
opportunities within the context of the three areas of interest as outlined
in your order of reference.
In terms of developing new markets domestically and internationally, the
lack of sound market information for the fresh fruit and vegetable sector is
a current gap and potential opportunity for the government to support
business planning, trade negotiations and the sustainability of the Canadian
fresh fruit and vegetable industry within our global marketplace.
I must note that the current Infohort system is underfunded and under
resourced. Industry and government are currently working in the dark and at
a competitive disadvantage when it comes to market information on a domestic
level. Accurate market information is essential to support our needs for
market and economic analyses to build business and cultivate opportunities.
Additionally, innovation in the Canadian marketplace is required to meet
the ever-changing diversity of the Canadian mosaic. Immigration, an aging
population and globalization are some of the factors influencing eating
habits, trends and food spending in Canada. The introduction of new products
in Canada, food as nutraceuticals and other innovations, ranging from
packaging to production technologies, will ensure the long-term
sustainability and viability of Canadian agriculture, if Canadian
agriculture has the support to keep pace; and this support is fundamental.
The positive for the fresh fruit and vegetable industry is that we are
seeing a growing trend of Canadians looking to whole foods to address health
and wellness. The question we must ask is this: Are we, as Canadian
policy-makers and producers, supporting this trend with the appropriate
policy and environment for Canadian innovations to flourish and lead the
market domestically and internationally?
Grower access to new production technologies, including crop protection
products, is essential to remaining competitive. The Government of Canada
must be agile and proactive to support the rapid pace of change that the
fresh fruit and vegetable industry functions within every day. To this end,
we encourage the continued cooperation between the Pest Management
Regulatory Agency and their international counterparts to ensure that
Canadian industry has access to the products and technologies that ensure
competitiveness and a safe and secure supply chain for Canadians.
Additionally, the government must work closely with industry in other areas,
such as the modernization of the fresh fruit and vegetable program,
including food safety, grades and standards, and traceability.
Furthermore, for an industry to be competitively sound, financial risk
mitigation tools must be available. Financial risk mitigation has been an
issue since the late 1980s. In 2005, the issue gained more prominence as it
was reported that the fresh fruit and vegetable trade held the highest rate
of bankruptcies at 2.3 companies per $1 billion. This figure does not
include deliberate closure or termination of companies in the trade either
to avoid payment of suppliers or legitimate business termination, including
insolvency. The impact on Canadian business, specifically the primary
producer within the fresh fruit and vegetable market, was and still is
Additionally, the 2005 Hedley report, submitted by industry to the
Government of Canada, identified illegal to unethical practices on the
issues of non-payment, slow payment and insolvency. This report demonstrated
the need to develop a tool for a financial protection program similar to the
Perishable Agricultural Commodities Act, or PACA, trust in the United
States. Why do we need this? The benefits are simple. It is about people
being paid fairly and in a timely manner, all of which indirectly impacts
consumer pricing and food security and directly impacts producer incomes.
The solution, however, is not simple but essential: Improve the current
marketing regulations. The Hedley report provides scope for change. As an
example, this could include amendments to the CAP act and improved market
information be made available to industry for improving greater transparency
and information symmetry in the markets.
Currently, 60 to 70 per cent of Canadian fresh fruit and vegetable
exports go to the United States. Canadians enjoy the benefit and security of
PACA when trading within the United States. Without a reciprocal risk
mitigation tool available in Canada, there is a risk that the U.S. industry
may pressure the United States government to remove Canada's preferential
treatment under PACA, thereby putting Canadian growers shipping to the U.S.
at risk. While industry is appreciative of the work currently under way by
Agriculture and Agri-Food Canada, more needs to be done quickly.
Trade barriers within North America are another concern for CPMA and its
members. On this, CPMA supports a North American perimeter approach, as
developed by Prime Minister Harper and President Obama, as we hope this will
support the removal of trade barriers between our two countries.
Finally, and perhaps our area of greatest concern, is the rising levels
of childhood obesity and associated disease. Fresh fruit and vegetables play
a significant role in the health of our children and all Canadians.
Statistics Canada data from 2010 has shown a decline in the number of fruit
and vegetable servings Canadians consume. We need the Government of Canada's
help to stop this decline. Access to fresh fruit and vegetables and the
perception that fresh fruit and vegetables are costly and difficult to
prepare are all factors that impact food security. Consumer education and
bringing Canadians closer to the farm are important steps to addressing the
issue. Examples of this can be seen around the globe — the U.K., Ireland and
our neighbours to the south have all invested at the national level in some
form of fruit and vegetable program. We must recognize that every dollar
spent today on programs that put another serving of fruit and vegetable in a
Canadian's stomach will exponentially reduce the amount spent by government
on future health care costs, address food security issues and support the
delivery of a year-round supply of healthy and tasty fresh fruit and
vegetables for our children and the overall population.
In closing, CPMA is co-hosting, with our partner the Canadian
Horticultural Council, a fall harvest event on November 22 and 23 in
downtown Ottawa, which will focus on many of the issues I have outlined
today. This event will include meetings with your colleagues in Parliament
and will aise awareness of the issues impacting industry and the significant
role the Canadian produce industry plays in the health of Canadians and the
financial viability of Canada. Thank you.
The Chair: Thank you, Mr. Lemaire.
Anne Fowlie, Executive Vice President, Canadian Horticultural Council:
Good morning and thank you. It is truly a privilege for us to share
information with you.
The Canadian Horticultural Council, established in 1922, is a national
association representing producers, packers and storage intermediaries of a
diverse assortment of over 120 fresh fruit and vegetable crops. Membership
includes provincial and national horticultural commodity organizations
representing more than 25,000 producers in Canada as well as allied and
service organizations, provincial governments and individual producers. Our
mission is a commitment to advance the growth in economic viability of
horticulture by encouraging cooperation and understanding to build national
consensus on key issues and deliver clear and united messages and
representation to you and other colleagues and international parties.
The industry is highly diversified, as in agricultural production, and is
one of Canada's largest agri-food industries. For example, Canadians spend
more than $14 billion on fruit and vegetable products, fresh and processed,
which accounts for 25 per cent of all retail food expenditures, so certainly
it is not insignificant. It is indeed one of the larger agricultural
production sectors, with over $5 billion in cash receipts. It is the major
source of cash receipts in British Columbia and Prince Edward Island and
accounts for more than one half of crop receipts in all provinces outside of
As in all farm sectors, horticulture has been greatly affected by
globalization, the strengthening of the Canadian dollar, increasing
regulatory costs and, of course, the concentration at each end of the supply
As an organization, we have achieved a certain measure of success over
time. The Seasonal Agricultural Worker Program began as a partnership with
producers, the Canadian Horticultural Council and the Government of Canada
over 40 years ago. It thrives today, and many producers are in business as a
result of it. The memorandum of understanding for the partnership was struck
between the Government of Canada and the Canadian Horticultural Council and
remains in place today.
In reference to the pest management centre within Agriculture and
Agri-Food Canada, the council and its efforts were integral to the
establishment of this all-important facility, which is contributing to
With respect to food safety, the CanadaGAP On-Farm Food Safety Program
for growers, packers and storage intermediaries is the only food safety
program in Canada to have been successfully benchmarked to the Global Food
Safety Initiative. This is a tremendous credit to producers, to the minister
and the department and to the Canadian Food Inspection Agency.
We are very pleased that you are considering the issues in your order. I
will begin with a few comments on improving food diversity and security, as
we like to refer to that, by Canadians for Canadians. It is a priority that
will be achieved only through dialogue, understanding and strategic
What is required? You have already heard my colleague, Mr. Lemaire, touch
on a number of things, and I will as well: providing adequate funding for
research and innovation; taking appropriate actions to develop and implement
policies and programs that foster producer profitability, and this includes
traditional and non-traditional risk management programs in the very
broadest sense; ensuring a favourable regulatory environment that is
conducive to commerce, and timely access to new crop protection
technologies; and, of course, supporting and promoting food safety and
However, it begins on the farm, and prosperity at the farm gate will
drive prosperity beyond the farm gate. A consistent, safe, nutritious,
quality product produced in a sustainable and competitive manner, which
includes timely access to new and innovative technologies and a host of risk
mitigation tools, marketed at a reasonable price with full and timely
payment will provide long-term benefits. This is the true recipe for
innovation and sustainability.
Research and innovation are critically important to maintaining the
competitiveness of Canada's horticultural sector. The announcement of the
Canadian Agri-Science Clusters Initiative was received with enthusiasm and a
sense of opportunity for horticulture and indeed all of agriculture. Its
stated purpose is to encourage key agricultural organizations to mobilize
and coordinate a critical mass of scientific and technical capacity in
industry, government and academia in order to create, design and implement a
national program of applied science, technology transfer and
commercialization plans in support of sector strategies and priorities to
enhance profitability and competitiveness.
In 2009, horticulture rationalized its needs and priorities vis-à-vis
research and innovation into five theme areas: health and wellness; food
safety and quality; production and production systems; environmental
performance of the horticultural system, which includes pest management; and
energy management and efficiency. We believe these to be well aligned with
the Government of Canada priorities.
Our mandate with respect to our science cluster is to ensure appropriate
linkages with science and technology stakeholders to contribute to an
accelerated pace of innovation in horticulture; facilitate the adoption of
new technologies across horticulture; provide a forum to address and access
the new agri-innovation program under Growing Forward, which we hope will be
sustained in the next agricultural policy framework; and protect the
interests of members and their investment through appropriate IP protection
and the acquisition of licensing rights, where appropriate.
The result of this program is that it enables industry and researchers to
collaborate and work toward the goal of enhanced profitability and
competitiveness through the use of scientific and technical resources to
support innovation strategies. Innovation is critically important to
producers in order to maintain competitiveness. The potential benefits and
synergies that will be accrued through the cluster by improving coordination
of applied research initiatives among various Canadian research
organizations are of great value to the industry, as well as the public
The suite of initiatives now under way through the agri-science cluster
may be found in the annexes in the document you have received.
I mentioned production research, and we certainly cannot underscore that.
I will use a few examples. One I am familiar with, because I worked for 20
years in the potato industry in New Brunswick, is wireworm, which is a
national problem. The devastation that wireworm has been causing in the
potato industry in P.E.I. has been accumulating and the dollar value
associated with these losses is increasing substantially. Estimates are that
approximately $3 million in claims, or 20 per cent of the total crop
insurance claims paid out to Island farmers, have been due to wireworm
damage, and that is just in Prince Edward Island. It is an issue in all
Carrots are also affected. In P.E.I. and Nova Scotia, fields have been
abandoned because of the damage. This is just one example of the need for
research and technology because, as I said, it begins at the farm. Without
those quality raw products to then take along the supply chain to sell as
fresh or further process into other products, we do not have that
competitiveness and that economic driver that the sector is.
Key to enhancing agricultural sustainability are risk management, which
includes pests and disease, and looking at new ways of producing things. As
we move toward many new types of food and technologies, we will be looking
at other ways of production and marketing. It may not be necessarily by the
traditional barrel of potatoes, but perhaps by grams or pounds of nutrients
from blueberries or other crops.
There will need to be different risk management tools associated with
that. The types of things we need to be thinking about as we look ahead
include a favourable regulatory environment; food safety and traceability —
and let us keep it to the science; bio-security; and for our sector in
particular, we look very much to developing and establishing a national
plant pest response strategy. One does not exist for the plant side. There
is one for animals but not for plants, and we are fortunate that the
minister recently approved a project for us to begin the first steps in
looking at that.
On industry challenges and opportunities, I have spoken to some of the
production-related challenges. They are often overlooked, but that is where
it started. There is also access and commercialization of new varieties;
storage and post-harvest management; and marketing and education.
Regarding developing new markets domestically and internationally, in
2009, Minister Ritz announced the creation of the Market Access Secretariat.
They just held their annual meeting earlier this week. The minister attended
to release their first report, which shows some positive success. This was
an initial response to industry's recommendations as to how to strengthen
Canada's market access approach.
A number of our commodities are participating in programs that are
enabled through agri-marketing and are looking at the development of
long-term international strategies. Those include apple, greenhouse, potato
and tender fruit.
Some of the sector challenges and barriers are that the regulatory and
standards playing field is not level. Canada has world-class regulatory
standards in the areas of health, food safety, labour and environmental
considerations. Canada complies with these regulatory standards and absorbs
the associated costs and implications. However, many other countries do not
have these in place. As we look to negotiate international trade agreements,
perhaps it is time to include some language that can help us come closer
together with some of our competitors.
There are many non-tariff trade barriers, which include phyto-sanitary
regulatory requirements, the high cost of foreign inspectors to visit Canada
when opening new markets, and lack of free trade agreements with some target
markets. One thing to remember with respect to target markets is that one
shoe does not necessarily fit all because there are many industries that can
compete but are at varying sizes and states of maturity.
How do we address some of these challenges? My colleague spoke to the
deficiency we have in strategic market intelligence. I cannot stress that
enough. It is so evident in many things that we do, not the least of which
over time has been using U.S.-generated import information to defend
ourselves in trade actions against the U.S. It is not appropriate.
Training for exporters on regulatory requirements and shared adaptation
and development of material from the brand Canada campaign is gaining
traction. Now we can use that domestically; it has been a great move to be
able to do so.
As far as a vision goes, it includes securing market intelligence;
looking at sanitary and phyto-sanitary preparedness, including prevention
and response; having an appropriate dispute resolution; and knowing up front
what a lever of compensation may be starting out.
Finally, there is the health advantage, which my colleague also concluded
with. We see that as a tremendous opportunity for our sector in particular.
Healthier Canadians will place less demand on publicly funded health care,
and we have a unique opportunity to contribute to that.
We are in the food production business, but we also see ourselves very
much in the health business. We are the only group that truly can say "eat
more," and there is a lot of data to back that up. Hippocrates had it right
a long time ago, when he said: "Let food be thy medicine and medicine be
thy food." He was not too far off all those years ago.
We have an event coming up in a few weeks, as my colleague mentioned. We
hosted one nearly a year ago. At that time, Dr. Colin Carrie from Health
Canada made an encouraging comment to everyone present when he said
horticulture has an unprecedented opportunity to impact the lives of
Canadians. That very much reflects the feeling we have coming from our
With that, I look forward to your questions and dialogue.
The Chair: Thank you very much, Ms. Fowlie. Before beginning the
question round, I just want to share with you that on the marketing side,
last week I saw potatoes in a New Brunswick warehouse that had white flesh,
red flesh and now blue flesh. They were looking at it also on the health
side for food across Canada.
Senator Robichaud: Thank you for your presentation. Senator
Mockler forgot to mention that there are also red potatoes. Where I grew up,
we had to have red potatoes with fish. They went very well together.
You talked about market intelligence; actually, you both mentioned it.
How do you suggest going about it? On one hand, producers and associations
such as yours certainly have a role to play. But on the other hand, how
could government agencies help you with that?
Mr. Lemaire: The current issue we have is the change in resources
and in the structure and collection of the data. Historically — and this
goes back 20 to 25 years — we had government officials, through Agriculture
Canada or the Canadian Food Inspection Agency, available in the markets to
collect data. Data collection is a very resource-intensive process. Some of
the best practice in the collection of market information can be seen in the
United States, where there is a fairly intensive resource allocation in the
field, at wholesale markets and at the farm level, to understand storage
data, production data and market pricing.
Those resources have been reallocated, as time has passed, to other
priority areas. We have moved to a voluntary information system. The
Infohort system, currently operating under Agriculture and Agri-Food Canada,
is a voluntary system and collection of data. It is totally inaccurate.
We have been working with Agriculture Canada, the Canadian Horticultural
Council and the Canadian Produce Marketing Association, the CPMA, to try to
find solutions. One of the challenges comes back to the information that is
being provided. An example is prices at the wholesale level being priced at
what would be on their sales sheet. They are not true market prices. There
could be a difference of $20 a case. What happens is that market information
is showing what the wholesale price is, but then negotiation happens
relative to what the actual price will be once sold. That actual price is
not being captured. When we sit down and start talking about true pricing —
what product is being sold for in the market — we are not able to capture
that data. Additionally, we are not able to capture true market- pricing
data that is coming from the farm, wholesale or retail.
All of this does help the primary producer to understand what the market
activity is, how they can get the best price for their product within the
market and, when they look at other economic drivers, whether they are
actually growing and providing the right product to Canadians. We have to be
ahead of the curve relative to that changing mosaic. Right now we are seeing
a wide change in Canadian eating habits due to a change in the Canadian
landscape. People have new appetites for different foods. The Canadian
producer has to be in a position to support those changing appetites and to
introduce their products to that changing dynamic in the Canadian
marketplace. Without the appropriate market information to understand what
is being sold, eaten or consumed and how it is really priced, it is
difficult to develop a business strategy for the production and supply chain
of a product, to market that product through as one piece.
Senator Robichaud: It is the chicken or the egg. Where do we
Mr. Lemaire: I totally agree; that is a very good point. The piece
of the puzzle comes back to setting the structure. We currently do not have
an appropriate structure to collect data, and that is a starting point. The
structure has moved to a position where it is not functioning to meet the
needs of government and of industry.
Work is happening, through the Horticulture Value Chain Roundtable, to
determine what industry requires and what information could be collected.
The Quebec Horticultural Council is leading some of that market-data
collection. They are running a pilot project, and it is very labour
intensive. We are finding that it does come back to investment. What are we
investing in the collection of that data to improve our business and trade
practices to be more productive on an economic level?
Ms. Fowlie: You are absolutely right. It starts with producers.
But we need to trust them and ensure the information is used correctly. As
my colleague mentioned, the necessary structure is not in place. A number of
years ago, the Canadian Food Inspection Agency was involved in data
collection. That is no longer the case. The same goes for Statistics Canada.
This is key in terms of risk management, because if producers do not know
the real price on the market, they sell for less. And that affects the
entire market, not only where they are, be it Grand Falls or Charlottetown,
but Toronto and Montreal, as well. We need the right structure and
coordination. We need to take a close look at structures that are working
Senator Robichaud: You would need supply management, a structure
of that nature, would you not? Okay, thank you.
Senator Plett: Ms. Fowlie — and I would like both you and Mr.
Lemaire to answer this question — you referred, in your presentation, to
buying Canadian for Canadians. We are upset when President Obama comes out
and says, "Buy American." I think we are very dependent on exports. I want
you to go more into to whom we export and how much. If we really promote
buying Canadian for Canadians, are we being a little hypocritical when we
then want to export our products?
Ms. Fowlie: Is that not always the name of the game when
negotiating trade agreements? We want access, but we have to give access as
In the document you have, I did include some charts that indicate the top
10 export markets for Canada's fruit products, vegetable products, and
potato and potato products, which are categorized separately. Certainly, the
United States — no surprise there — is our key trading partner.
It is no surprise that, as Canadians, we are maybe a little shy and not
as enthusiastic as we could be about our own products or about buying our
own products. I think some of that can begin at home. Perhaps there are a
few things to learn from our colleagues to the south. I am not looking to
cause trade disruptions or anything, but there are things that we can do
here, possibly through a number of our food institutions and food service
purveyors. Perhaps there is not always the extent of Canadian product
available that there should or could be.
If I digress slightly in talking about health and what is going on in the
U.S., it is because what has happened there is phenomenal. In January they
re-released their food guide. All the messaging and visuals suggested make
your plate half fruit and vegetable. That fits well with what we look at
buyers to do within our sector to try and contribute to Canada's health
agenda. Part of the issue is that it is not short-term — or low-hanging
fruit, if you will excuse the pun. Rather, it is a long-term investment and
philosophy that has to be adopted. In the U.S., 18 per cent of GDP is going
to health care costs. That is not sustainable for them. Canada's percentage
is not that high yet, but that it could be the trend and where we are going.
The solution is a philosophy and is multidisciplinary and
multi-departmental in that a number of departments and ministers need to
champion and collaborate on this.
Mr. Lemaire: Relative to the local movement program demand, on a
global level we are seeing an increased demand within geographic areas of
interest in their own local production, which is positive. We need to
capture and leverage that. Also, we have to recognize that within the
Canadian climate, we do not necessarily produce the range of products that
our changing Canadian population is demanding. For example, we do not
produce citrus or bananas. There is a balance between what we are importing
and what we are selling domestically. Industry has begun to adjust and work
Canadian retailers want to sell local product. It is part of their vision
and mission to include the highest quality and volume of product in the
market. Part of that process includes understanding when production is
available at the beginning of season and how easily or well they can provide
that product throughout the season, while ensuring that, as Ms. Fowlie
touched on, the product is being produced at a high-value level, which comes
back to innovation and the production level.
Industry partners with allied industries around the globe. For example, a
tree fruit industry in Canada recognizes that while they have a certain
production level they would like to sell domestically, they also have
product that is exported. Work with the U.S. tree fruit industry is
collaborative, in peaches, for example. When our season comes in at this
time of the year, work ensures that the shoulder components are covered off
with imported product and through the off-season with local product. That is
a healthy market relative to a grower relationship and production base. To
ensure that we meet consumer needs, we build a domestic market and an export
market to ensure balance between local sales and international sales.
Ms. Fowlie: Obviously, in Canada, we do not produce oranges or
other such fruit, as Mr. Lemaire mentioned.
Imagine a salad bar and baked potato oven in every school in this
country. Kids love them. Imagine the additional volume of Canadian-grown
products throughout the school year that could be consumed in that manner.
That is a huge trend south of the border. There is a huge impetus around
putting a salad bar in every school, in part because inner city schools are
thought to be food deserts. Often people do not have access to stores and
transportation with the kinds of produce you might find in a downtown store.
Putting a salad bar in a school does not require the infrastructure work
that a big kitchen requires. New schools being built could readily have a
salad bar set up without that kind of infrastructure. In schools being
retrofitted, the old kitchens are being removed. This is transportable,
easy, fun and healthy.
Senator Plett: We are closing school cafeterias because kids do
not want to eat there.
Ms. Fowlie: We have to make it so they will want to eat there. We
are seeing it happen.
Mr. Lemaire: If I may, I will answer the question relative to
consumption. There is an issue relevant to the infrastructure at school
cafeterias. The U.S. food service model within their schools is different in
that they can provide food in an efficient manner at the elementary and high
school levels. However, that should not be a barrier to Canadians finding a
solution. The issue comes back to taking a step before the cafeteria food
delivery at the education level. We have seen that happen with the recycling
For example, I have three young children who do not bring a disposable
drink container to school. They pour their juice or milk into a reusable
container; it is part of their lifestyle. They think about how they are
impacting the environment. We have not been effective in increasing the
consumption of fruit and vegetable to the extent that we could be. We need
to educate young Canadians, our consumers of tomorrow, that this should be a
major part of their diet. Low nutrition foods that they have easy access to
should be secondary.
Senator Plett: I guess I am from Missouri on that one. We need to
lock the school doors and tell the kids they will eat there, if that is what
we want them to do. If a McDonald's is located beside the school, the kids
would rather eat there.
I just came back from China, where we visited a school of 1,200 kids with
a New Brunswick curriculum, New Brunswick principal and many teachers from
New Brunswick; certainly all the teachers were from Canada.
They expected everybody in a kindergarten to grade 12 school to eat in
the school cafeteria. They had a card and parents put money on that card so
the kids could simply swipe the card to eat in the school cafeteria. These
kids are eating healthy. I asked about the grade 11 and 12 kids and was told
that because there was no other convenient choice, most of them were eating
at school as well. If a McDonald's is close to the school, kids will prefer
to eat there. That is an observation more than anything. Before you address
that, I see that China is on your chart.
We had a presentation by our good friends from McCain when we were in
China, where they are making a lot of French fries. They buy most of their
potatoes in Mongolia. How much of our food do we export to China, where 1.35
billion people eat a lot of vegetables and French fries? Are we doing what
is needed to tap into that market?
Mr. Lemaire: The Chinese market is a priority area for many
Canadian producers and exporters, as it is for many around the globe. It is
a very competitive market to engage. Beyond just export, some Canadian
growers-shippers and primary producers are setting up relationships with
Chinese companies to run secondary businesses there to deal with some of the
shipping issues. That process is beginning. That area needs further
investment and work on the part of the government as well as industry to
build relationships. The Chinese market is truly one of relationship
development to build commerce.
Stepping back to touch on your final comment about school food programs,
I was part of the subcommittee under the Horticulture Value Chain Roundtable
with Agriculture Canada for marketing, and we had looked at opportunities
for developing a similar concept or programs. Funding is always an issue. I
am fully supportive of the concept of introducing a salad bar or some type
of fruit and vegetable program in elementary and high school levels, but I
think this comes back to my comment relative to no magic bullet or single
bullet that can solve our issues. Addressing how our youth consume food has
to be an integrated approach that addresses not only what they are eating in
the schools. Locking the doors and keeping them in for lunch would be a
challenge, but very interesting. I think there is an opportunity of
addressing what is being served in fast food, and we are starting to see
that transition within some of our fast food partners of introducing more
sliced apples and more salads and other alternatives to their traditional
offering. That is the trend we have to begin introducing and changing, so
that when the young consumer goes to an opportunity purchase, their
selection is fresh fruit and vegetables. That takes education.
There is a combination approach that has to be introduced. One is access
and introduction to food so they taste and understand what they are eating
and they are exposed to it, where you would get that through the school
program, whether it is salad bar or some type of snack program, and two is
what they are getting on the exterior through their home life and fast food
exposure and trying to bring the entire puzzle together. The many pieces
have to be connected.
Senator Plett: I believe Quebec tried to outlaw poutine in hockey
arenas, did they not? I do not know how far they got.
Senator Mercer: I remember the riots in the street about banning
poutine. I am sure there would have been.
Thank you for being here. We do appreciate it. Mr. Lemaire, in your
presentation, you talked about 67 per cent of Canadian fresh fruit and
vegetables going to the United States. We enjoy the benefits and security of
PACA when trading with the United States without a reciprocal risk
mitigation tool available in Canada. You say there is a risk that U.S.
industry may pressure the United States government to remove Canada's
preferential treatment under PACA, et cetera.
This is the first time that I have heard about a possible threat to fruit
and vegetables from Canada. I have been on this committee for eight years
now. I am quite familiar with the problems with beef we had through the BSE
crisis and other issues of food. Is there a real threat? Are people talking
about this? Are people gathering together in the United States, as they did
to attack softwood lumber where we ended up leaving money on the table so
they could have more money to challenge us in the future? Is this real, or
is it something you are thinking might happen?
Mr. Lemaire: I can answer that, and then I will ask Ms. Fowlie
also to address the issue. Between our two organizations, Canadian
Horticultural Council has taken the lead on driving the issue forward on
behalf of the primary producers and Canadian growers who are truly at impact
To quickly answer your question, yes, this is a serious concern. There is
discussion. As I mentioned, it has been an issue since the 1980s. Within the
2000s, we have been able to address the concern on a direct financial impact
level. The United States shippers to Canada, who are also being impacted
because of non-payment, slow payment or insolvency are ready to call for
action because of their frustration that the Canadian system has not
addressed the issue for a such a long period of time.
I mentioned the Hedley report in 2005 went to Agriculture Canada
identifying this issue, and I can make that available to the committee. The
Government of Canada, through Agriculture Canada, created an additional
review. I do not have the name of that report off the top of my head. The
two were conflicting, and that puts us now in the position of nothing truly
The current activity under way through a project with Agriculture and
Agri-Food Canada is an analysis of the actual issue that we currently stand
in around bankruptcies, insolvency and non-payment and the potential
solutions. This issue has been brought forward to the regulatory cooperation
committee through Treasury to look at how we can address this under current
regulation, but the Hedley report has identified that that may not be a
potential based on how our current regulatory framework is structured.
At the end of the day, with having our products that are being exported
from the United States and imported here in Canada and those U.S. companies
not receiving payment or slow payment, the frustration levels are high, and
it has come up in every single North American trade committee meeting that
we hold within our organization.
Ms. Fowlie: Thank you for the question. It is a legitimate
As I said, I worked in the potato industry for many years. From 1978 to
1986, I was involved in marketing potatoes, and I can tell you that my
preference was to sell to Boston or New York, not Montreal or Toronto. The
reason is that if there were problems, I was sure that I would be paid,
thanks to the PACA program that was in place in the U.S.
It is legitimate. There are several large groups in the U.S., large
producer associations as well as individual companies marketing to Canada,
that are frankly tired of the situation where there is slow pay, no pay,
legitimate bankruptcy or fraudulent bankruptcy where they are not being
paid. They are saying they are prepared to go to the U.S. trade
representative. This has been stated at meetings that Mr. Lemaire has
referred to. We have seen this written in trade publications. Certainly
folks at the U.S. embassy here in Ottawa are well aware. In the booklet that
you have, in the annexes, there is a two-page document on financial risk
mitigation in the fresh fruit and vegetable industry. This was used as a
briefing note for Ambassador Doer. At the United States-Canada Consultative
Committee on Agriculture, this has been on every agenda for the meetings
Senator Mercer: You identified the problem. I now understand it is
a real problem, but what I do not understand is how we solve it. This is
come and go. There are insolvencies and bankruptcies, most legitimate and
some fraudulent. I suspect that will continue in all industries. What is the
role of the government in stopping this?
Ms. Fowlie: The role is to help facilitate implementing a
made-in-Canada solution that will provide an outcome similar to that of the
Perishable Agricultural Commodities Act. Part of what this does look to do,
quite frankly, is provide a preferential creditor status for vendors of
fresh fruits and vegetables. They are highly perishable. There is no serial
number. If there is a problem, there is nothing to go and reclaim to try and
receive any money.
Frankly, it is a little more complicated in Canada because of the
federal-provincial-territorial infrastructure and jurisdictions. Now, that
being said, just because it is complicated does not mean there cannot be a
solution, because in a number of reports and legal opinions that have been
done, there are recommendations as to the jurisdictions that the Government
of Canada has and the provinces have with respect to contract law. I can
never remember what the second one is. One is one and one is the other. Each
can delegate to the other — federal or provincial — some responsibilities,
or they can each delegate their respective responsibilities to a third
party. There are ways of doing that.
We are not looking to Treasury Board for funds for this. It needs to be a
grower-driven and maintained solution long-term, which is what it is in the
United States. If you look at the history around it, it started many years
ago because of cattle rustling; cattle were being stolen and people were not
getting paid. That was the genesis of it in the U.S.
Senator Mercer: Industry will drive this, not government; is that
Ms. Fowlie: Government has a role to play in helping facilitate
Senator Mercer: That is a much simpler role. It is a role I think
government can and should play.
Senator Robichaud: As a supplementary to that, how would the
growers, the primary producers, participate? Would they be the ones on a
check-off or something to provide funds to operate that mechanism?
Ms. Fowlie: We can provide supplemental information to you that
would have more details as to how that would work. Particularly in the
potato industry and in Atlantic Canada, there have been a lot of significant
losses over time from this type of thing. We will follow up on this with you
because we could spend a lot of time on it.
Senator Mercer: Ms. Fowlie, you talked a bit about pricing, as did
Mr. Lemaire — about producers not knowing what the price was. I am a city
boy, so a lot of this is new to me as I go through my education here on this
committee. However, in the farms I visited, I was always impressed by the
fact that every farmer had a computer in the kitchen or the office, and one
of the things that he or she was doing was monitoring the prices. They could
tell you what was going on in Chicago with respect to the price of beef or
pork or what have you at that very moment as they went through their day, as
well as the price of feed, et cetera. I am surprised there is a lack of
understanding as to what the prices are on any given day.
Mr. Lemaire: You touched on two important points, senator. First,
they are getting information on Chicago prices because the U.S. does have a
comprehensive market-data collection program. Second, they are not
collecting it on fresh fruit and vegetable data; they are collecting it on
pork and other commodities.
If we are looking at a potato producer or a blueberry producer — you can
pick any fresh fruit and vegetable commodity here in Canada — they will not
have access to that same accurate market information that you see in the
U.S. It is not available here in the Toronto market, the Montreal market, in
Vancouver or smaller markets across the country. That is part of the
challenge on our domestic delivery.
For understanding market pricing on an international level, specifically
selling to the U.S., they do have the opportunity to access more accurate
data in determining what they are selling for to their U.S. buyers.
Senator Eaton: Your presentations interested me very much because
we have just come out of spending a year looking at the forest industry.
What we learned is that some sectors of the forest industry were full of
self-help. With FPInnovations, they did things for themselves. Others came,
and it was the government should be doing this and the government should be
doing that. I guess what struck me about your presentations was I did not
hear what you guys were doing.
Senator Mercer touched on it. Businesses go out of business; we all know
that. Why would your association not have some kind of insurance for all
your members? When you complain about people not eating enough vegetables
and fruits, unlike Senator Plett, I believe it starts at home. What are you
guys doing? Why are you not flooding us with educational material? I am
I do not think it is the government's place to educate people to eat more
fruits and vegetables. I think it is a good thing to come out with what you
should be eating, but it is your industry. You have some rich players in
that industry — Loblaws, Sobeys, you name it. Why are they not on board
helping you guys? Tell me, what do you do for your producers?
Mr. Lemaire: I will take the education and marketing component
CPMA created back in 1994, through the Fresh for Flavour Foundation at
the time, a program called "Reach for it." That was in cooperation with
Health Canada, to support Canadians consuming five to ten servings of fruit
and vegetables per day. Prior to that, there were monthly promotional
activities happening through the CPMA on fall harvest events, such as
consumer awareness on how to prepare, store and can fresh fruit and
vegetables as a component of outreach.
Since the 1994, aggressive, direct-to-consumer programming that CPMA has
been involved in, we have moved and transitioned our programs from "Reach
for it" to "5 to 10 a day — For better health!" That is a new version of
the program, which is in cooperation with the Heart and Stroke Foundation of
Canada and the Canadian Cancer Society.
Senator Eaton: Where do Canadians like me see that?
Mr. Lemaire: On that note, we leverage the opportunity to use
public service announcements. The delivery of a direct-to-consumer campaign,
to be truly effective and make change, is between $8 million and $12 million
per year. As a produce industry that functions on margin, not volume, we do
not have those types of funds. We are not supply managed. We do not have a
check-off program to collect funds. We have a diversity of commodity groups
Senator Eaton: Why would you not have a check-off fund? Why would
your associate members not pay a membership fee? Why would people who buy
produce from you not throw money back in to help you sell more? Surely it is
a benefit to everyone if you sell more.
Ms. Fowlie: Part of it comes back to infrastructure. When you look
at milk and dairy campaigns, holy cow they are good. They are fantastic. We
would love to do it but we do not have the instrument in place through
supply management to have those types of check-off.
I mentioned in my presentation that a one-size shoe does not necessarily
fit all, and that applies to many things. When I look at a number of
instruments that are in place with supply managed commodities, they were at
a far different level of maturity a number of years ago when those types of
instruments could be put in place. The produce industry was not there then.
That is part of it.
Having a check-off for research and promotion is something that we are
looking at, but that is something that will take probably five years to
Senator Eaton: What you are saying is you are still very early
days of your association, is that right?
Ms. Fowlie: The associations are old; it is the margins. As my
colleague referred to, there are not those margins in the fruit and
vegetable sector at the producer end of things to be able to fund those
types of programs.
Mr. Lemaire: Relative to what we have been able to achieve — and
the figure has varied — the Canadian Produce Marketing Association, through
industry partnership and allied association partnership, has invested a mere
$150,000 per year in our direct-to-consumer outreach program. We have been
extremely creative through social media, public service announcements, the
heart and stroke and cancer relationships and other allied industry partners
to deliver the message of the "Mix it up!" campaign with fruit and
vegetables. Prior to that, there was the "5 to 10 a day — For better
health!" campaign and the "Reach for it" program. These programs have
been effective. Health units across the country utilize our posters and our
However, it does come back to the investment in the program relative to
the amount of funds currently available to primary producers not only from
the minimal margins but also through the entire supply chain. While Loblaws,
Metro and all of the major retailers that are part of our organization are
massive companies, they still function, on the produce side, within the
tight margin framework that the primary producer and the entire supply chain
function within. It is slowly added to as we move through, but the margins
are still very tight within the entire chain itself.
Are we looking for an industry solution? Most definitely. The produce
industry has thrived, grown and developed because of how we operate
together, but we operate together through a public and private relationship.
When we talk about the need to work with government, we refer to a
collaborative approach to find solutions. Every program or issue that we
bring forward, through both of our organizations, comes with a
solution-based approach. That is fundamental to our success in determining
what government and industry can do to find common ground and solutions.
You ask what we have done. On the risk-mitigation side, we had found,
leading up to early 2000, that we did not truly have a sound licensing
program, which is fundamental. Someone in Canada must hold a CFIA licence to
sell and market fruit and vegetables, but there is an issue relative to the
licensing. We worked with Agriculture Canada, at that time under Minister
Vanclief, to develop the Dispute Resolution Corporation, the DRC. At that
time, the executive vice-president of the CPMA moved to become the CEO of
the DRC. This organization, which licenses companies to sell and market
fruit and vegetables in Canada and also provides dispute resolution services
to deal with some of the issues around payment, has been a tremendous win
for the produce industry to start addressing non-payment or slow payment.
Part of that process could not have been achieved without the relationship
with, and support of, the Government of Canada, and that is where we see the
win-win relationship between public and private.
From an association perspective, we want to look at other potential
models to do that. On the risk-mitigation side, as Mme Fowlie noted, the
primary focus is on how we find a solution together. The U.S. industry,
while voicing concern, does want Canadians to find a solution. That is the
position they are taking now, saying, "Okay, what do we need to do to find
that solution?" This is happening to the point that some of U.S. industry
was willing to contract with representatives from Harvard to do an economic
analysis of Canada to determine what the solutions could be. The industry is
working together to try to find an outcome, but we have to do it together in
a public-private sense.
Senator Eaton: Thank you.
Jane Proctor, Vice President, Policy and Issues Management, Canadian
Produce Marketing Association: I wanted to touch on one of the comments
that Senator Eaton made. I certainly appreciate that we, as industry, have a
role to play in education and in helping consumers, and ourselves,
understand. However, I hope all will agree that there are opportunities to
partner between government and industry for education. I think we all agree
that the government does have a role to play in the health of Canadians.
Because the products we represent contribute so much to the health of
Canadians, if they consume enough of them, that is what we are looking for.
How can we work with government where there are those mandates, within
health, for example? How can we work together as an industry? There is no
question that there is a desire within industry to work with government
wherever possible. I think that is what we are hoping to do. We are
not-for-profit associations, though you are right that we have members that
are very large companies. What we are trying to do is leverage what we can
do as not-for-profit organizations, with unfortunately limited funds, and
what we can do together with government to try to impact the long-term
health of Canadians. We know what that will achieve for us in long-term
Senator Eaton: When you go to government, do you go saying, "This
is the package we have put together; could you finance this?" Do you go
having worked together and thought out exactly how you want it done?
Ms. Proctor: We do.
Senator Eaton: You have gone with an eductaion package and a risk
Mr. Lemaire: When we approach any of our public partners, like the
federal government, for example, we bring a solution-based approach. We
identify the issue and a potential solution. If we do not have the solution,
we ask our government partners to form a working group with us to determine
a solution, if one can be found.
We have a Committee of Government and Issue Management, which includes
CFIA, Agriculture Canada, the Canada Border Services Agency, Health Canada
and the Public Health Agency of Canada. We created this group, to meet twice
a year, because we found that various departments were not communicating
amongst themselves on the issues that the industry needed to address. We
brought those departments together with industry from the Canadian
Horticultural Council, CPMA and DRC to frame industry concerns, and
potential solutions and how to find them. A good example of an issue was the
concern we had with the border and the way that inspections were handled in
what we call hot docks. Products have to be maintained in the cold chain.
When they are not, you run of risk of product spoilage and of a greater
challenge to the economic issue of the industry.
Working with CBSA, we have been able to run an education program where we
went to a Loblaws distribution centre and taught their staff what the cold
chain involved. Then, our industry went to their facilities, and they walked
us through it. From that, we have come out with a statement of work that can
be used by CBSA at the border to find best practices and to reduce the risk
of hot docking, product spoilage, or whatever the case may be. That is a
perfect example of that win-win situation in finding a solution. We are not
asking for money. There may be a financial requirement somewhere, but, in
many cases, the solution comes with a better understanding of how we
function and how we need both government and industry. It is a win-win for
Senator Eaton: Thank you.
Senator Mahovlich: I want to thank our guests. They have answered
quite a few questions.
You mentioned that exports were 60 to 70 per cent. What are our imports
of vegetables? I am not asking about citrus or bananas. However, you can get
a baked Idaho potato at certain restaurants here, and it is still popular.
How many vegetables do we import?
Mr. Lemaire: I apologize; I do not have those numbers off the top
of my head, but I can provide them to the committee. They are available
through Statistics Canada.
Broadly speaking, at a retail level, $3 out of every $4 spent on fresh
fruit and vegetables is spent on imported product.
Senator Mahovlich: $3 out of $4?
Mr. Lemaire: This comes back to our discussion earlier relative to
opportunity. The Canadian domestic market has an opportunity to attract more
Canadians to their products and to work with their buying partners to expand
their market, but there are a few pieces they have to introduce — the right
product and the right quality, at the right price. They are three very basic
elements. To get there, there are the elements that Ms. Fowlie identified
relative to being competitive in the market around innovation and
technology. These have historically been challenges for some sectors within
The Canadian mosaic is a huge influence, as I touched on. In Calgary, I
was in a retail outlet, and there were dragon fruit displays from Vietnam.
That amazed me. Why? There is a very large Vietnamese community that is
driving the demand for that product. We need to have appropriate Canadian
demographic and market information to understand what we are producing,
whether we are meeting the needs of Canadians, and if not, what do we need
to do to enable them to experience the products we do produce and to build
the market for our Canadian producers. I hope that answers your question.
Senator Mahovlich: Yes, it answers part of it. You can go to
Chinatown in Toronto and get vegetables from China all the time.
I want to go to food safety. As soon as I start making a salad, I have to
wash all the lettuce — everything needs to be washed. My wife is always
after me. Is this necessary?
Mr. Lemaire: Safe food handling is an important part at the
consumer level. The CPMA is part of the Canadian Partnership for Consumer
Food Safety Education. This group represents not only the fresh fruit and
vegetable producers but also the entire food industry, including beef, eggs
and poultry. The partnership identifies the importance of "wash, cook,
clean" because safe handling by a consumer is extremely important and is
part of our food safety continuum. Canadians must recognize that. Primary
producers and individuals within the supply chain are operating within best
practices and clearly identified food safety programs to ensure that
Canadians eat safe and nutritious food.
We see a potential breakdown when a consumer takes a product off the
shelf, brings it home, opens a bag of salad and starts cutting it on the
same cutting board that they just used to cut chicken. The partnership,
which is another not- for-profit funded by our organizations — the CPMA and
others — educates consumers on how to handle products safely. Yes, you
should handle your product appropriately to ensure that you have a safe food
Senator Mahovlich: I am from Northern Ontario and grew up on
blueberries. People often ask me: Why do you look so good? I think it is the
blueberries. I see that some research is being on blueberries and that the
results will come out in November. Are you telling me that I will be able to
get a wild blueberry in the middle of winter?
Senator Plett: You will look better yet.
Mr. Lemaire: Currently, speaking to production levels relative to
production techniques, you will notice that you can buy a Canadian
strawberry later in the season. Everyone remembers when they were growing up
that they had to eat the strawberries as soon as they got them home because
the shelf life was very short. Canadian producers have introduced new
products that enable a longer season to support needs within the domestic
and export markets.
Work is being done on blueberries, as well as a range of other products,
so that Canadians can enjoy blueberries in the winter. Whether the research
is on wild blueberries, the determination is potentially there. Overall,
there are new blueberry varieties that extend shelf life.
Ms. Fowlie: You might not get a fresh wild blueberry in the winter
but certainly you will find frozen wild blueberries.
The invasion in new varieties and growing techniques is phenomenal. We
can find many fall varieties of strawberries grown in Canada, which we did
not have years ago. The Canadian strawberry season can extend to almost the
beginning of October. The blueberry research referred to is quite
interesting. It has to do with crop protection technologies. Nova Scotia
Agricultural College has worked with camera manufacturers and tractor
Senator Robichaud, I think they are working on that in your part of the
country as well.
The electronic eyes and cameras go through the field on a tractor and
discern between the blueberry plant and a weed to apply the crop protection
product only where it is needed. It is really neat. We would love to come
back and show you a video of that and bring some of the research findings.
There are interesting and innovative things going on.
Senator Mahovlich: Thank you.
Senator Rivard: Thank you, Mr. Chair. I had a lot of questions and
was very interested in the Hedley report, from 2005, dealing with the
financial protection program. But I would say that you addressed most of
them. The only question I still have about the Hedley report is, if there
were a financial protection program, would it apply only to sales abroad —
the U.S., China or elsewhere — or would you want it to apply to the domestic
market as well?
Ms. Fowlie: We think it should be available for sales in Canada
and in the U.S. It would be to have something equivalent to the tool
available in the U.S. That is not to say that it could not apply to sales
elsewhere, but for the time being, it would be to really address what is
happening at the Canada-U.S. level and the lack of tools in Canada.
Senator Rivard: I appreciate that your industry is fragile, with
margins being low and so forth, but I wonder what kind of impact this would
have on Canadians in other sectors if the government were to intervene to
secure your debt.
Ms. Fowlie: It would not be the government securing the debt.
Senator Rivard: It would be your association.
Ms. Fowlie: Exactly. The government would not be involved, except
to help us stickhandle in terms of federal versus provincial authority. We
would be happy to send you a more detailed explanation of how it works in
the U.S. The government is not involved; the industry manages everything and
the government steps in only to provide backup.
Senator Rivard: I would like you to provide that information. In
Quebec, for instance, dairy producers do not belong to Canadian
associations, they belong to the Union des producteurs agricoles or UPA. In
the horticultural sector, as regards fruit and vegetables, does Quebec
belong to the Canadian association?
Ms. Fowlie: Yes, the Canadian Horticultural Council. The Conseil
québécois de l'horticulture is a member. Other Quebec associations are
members of the CHC as well — potatoes, strawberries, raspberries, apples. A
number of them are members.
Senator Rivard: Thank you. I wanted to pick up on what Senator
Plett said about poutine. We know that Quebec, like the other provinces, has
a lot of arenas. When the skating rink belongs to the city, the city can do
what it wants. I know that some arenas have stopped selling poutine in
favour of selling more fruits and vegetables to help change people's eating
habits. The fact remains, however, that a number of arenas have concession
stands, so it is tough for the city to legislate in this area. It may seem
odd, but some cities have chosen to prohibit the sale of poutine in arenas.
Our committee is tasked with studying research and innovation in Canada's
agricultural sector. We have not discussed it a lot, but some of the
witnesses we have heard from in recent weeks have told us they could
increase production and reduce waste through innovation. How do you handle
waste? Do you think research grant programs could help to solve waste
problems and increase productivity at the same time?
Ms. Fowlie: Yes, but it would really involve a partnership between
programs, producers and members of the CPMA. That is especially important
given what we are seeing as far as new varieties go and the fact that they
can really change the percentage of waste. Regardless of whether we are
talking about potatoes or apples, that is really where things are.
Innovation in the right production practices can help make chemicals and
other pest control technologies accessible. It has an impact on product
So there are many ways of managing things. But as far as certain
varieties are concerned, there are long-term considerations, especially with
respect to development. It takes 15 to 20 years to develop a new potato
variety. If you are trying to change an apple variety and you introduce a
new seed this year, it can take up to seven years before you get a crop.
I am not sure whether any of you have tried a Honeycrisp apple before.
Wow. We do it better in Canada than anybody else. If you have not had
them, it is the most refreshing. It is just like eating candy or having a
drink. They are fantastic. Get your Honeycrisp while they last. It is a
relatively new variety, so the quantities are not bulked up hugely. There
will be Canadian Honeycrisp available probably until the first of the year.
If you have not had one, get yourself a treat. We will send you the
information about where it comes from.
Mr. Lemaire: Additionally, innovation is a very wide subject area,
similar to sustainability.
You commented regarding onions, linking sustainability and innovation
together, sustainability looking at both economic and environment. One of
our U.S. members, an onion producer in the state of California, presented a
sustainability model that we could learn from here in Canada. This
organization was trying to determine what they would do with the onion waste
from their processing plant, which they traditionally would put on fields.
The cost of disposal of that material on fields was approximately $450,000
plus the issue of dealing with the soil challenges that the waste creates by
Working with the State of California and their models around energy
efficiency and production, they invested in a sustainability program that
took the onion waste, created a liquid from that waste that was then moved
through a system that generated enough electric energy to totally power
their entire facility. Not only did they find efficiencies relative to no
longer having to pay the $450,000 to spread the materials, they found the
opportunity to reduce their total operating costs and sell power back to the
grid. That is innovation relative to how industry here needs to function.
You had touched on the jurisdictional elements around how we operate in
Canada. This is one of our barriers. We need to ensure we are working —
municipal, provincial, federal, territorial — and bringing an alignment and
harmonized approach with those multiple levels is fundamental in moving
Back to our discussion on how we operate as industry, there is the need
to ensure there is a collaborative and open dialogue between all those
levels of government to finding solutions, whether it is innovation, whether
it is production, whether it is new atmospheric packaging that enables
product such as blueberries to stay on the shelf longer and or in a child's
lunch box longer and that is biodegradable and safe for the environment. All
of these are elements being developed by industry currently, but more
innovation is necessary, and how do we work with the various levels of
government to find that innovation, whether it is through sustainability at
a provincial level and federal and or economic through various other means
available to us through production.
Senator Rivard: I appreciate your comments very much. But I would
like you to provide some information if you have time — and it may already
be in your documents, but we got them just before the meeting began so we
have not had a chance to consult them yet. With respect to the innovation
programs you have, you made an excellent point about blueberry consumption
and land farming involving onion waste. Could you give us a brief synopsis
of what you are doing vis-à-vis innovation and what you would like to do in
the medium term if you had the funding?
Ms. Fowlie: That will take some time. Obviously, as a sector, we
have priorities for the various areas of crop production based on the five
themes I mentioned. We are currently working on a study into innovation
projects and research. In time, we will be able to provide some reports.
But, certainly, in terms of innovation in the long term, as Mr. Lemaire
said, everything goes. From production to packaging and storage, it really
covers all aspects.
Senator Rivard: You can provide us with whatever you can. I am not
asking what you think could be done over a generation, but rather what can
be done in the short and medium terms. What kind of government assistance
would help in terms of figuring out ways to increase production while
Ms. Fowlie: Maintaining the agriscience cluster program is quite
crucial because it is truly a partnership, and industry brings money to the
Senator Rivard: You do not know whether many federal programs are
going to be renewed from one year to the next. I would like to hear any
suggestions you have when it comes to, for example, keeping the industry
viable or sustaining research efforts, both of which require a firm
commitment from the government. That might include an annual increase of
such and such amount or, more importantly, a firm time frame. Would you be
looking at a five- or ten-year program?
Ms. Fowlie: The policy framework on research and innovation should
cover ten years. Five is not enough because results take time. You are
right, then; longer is better.
The Chair: In terms of follow-up, this matter is particularly
relevant. Therefore, I would like to have you, the experts, examine the
entire gamut of federal and provincial products available, known as
programs, given your authority at the provincial level. Would you then be
able to provide the committee, through the clerk, with your feedback on
those programs and suggestions on how producers, processors and governments
can work jointly to improve your sector, as well as the remarks you made
this morning? That is what I have in mind.
Senator Ogilvie: I want to follow up on my colleague's drawing our
attention to our mandate here with regard to research and innovation and to
seize upon an example you just gave with regard to the Honeycrisp apple and
to tie it into the willingness or reluctance of producers to invest in
research to deal with their very own futures.
I sat in on a meeting between growers and a certain government agency in
a certain region of the country in which the problem was described as
follows: By the way, to preface it and follow up on observation about the
value of the Honeycrisp, it is my understanding that on either a volume or
weight basis, it commands four to five times the price of the average apple
from the producer. That is a pretty good premium. It enters high-value
markets particularly in Europe and elsewhere. There are other competitors
for this particular market. The specific example that was discussed while I
was present was the fact that it appears that there is the odd tree within
the Honeycrisp orchard that will produce apples in a given season that are
prone to core rot. It is not possible to detect just by looking at the tree
or the surface of the apple which trees will lead to this. The apples are
all harvested. It may well be that within a given bushel of apples there may
be an apple from that particular tree which, when it lands in a high-value
market in Europe, turns out to have rotted because of the issue with the
I want to be careful here, but I will say that I am aware that some of
the producers who are sitting at that table are among the most financially
successful individuals in this particular region. Yet it was extremely
difficult for them collectively to come up with $25,000 to match the
government program that is available to help deal with this kind of problem.
To detect and deal with this problem requires a scientific solution. It
is not the case of modifying a piece of equipment or training a field worker
more. It requires clear scientific knowledge of the modern variety.
I simply want to indicate, as we are dealing here with the idea of
research and innovation, that from my own observations there is some
distance to go in your area with regard to the recognition of the importance
of research to the end-value product. Here is one that commands a huge
premium and is being produced by very large producers.
I understand the difference between supply management and your area. That
was a point very well made and I understand it. Nevertheless, the issue of
research and innovation is extremely important, and I think we are probably
at a transition point regarding the attitude of major producers to the
importance of investing in an area of their own business that they have not
recognized in the past as being important. They sort of expect government to
simply take it over and do it.
My own feeling is that as we move into the value-added products from
fruit, for example, where you can take the skins of juice apples and attempt
to press those and turn them into juices that you will argue have
antioxidants in them and so on, we are in an era where your members need to
recognize it is in their best interests to find ways to invest with the
government in research that is now high-end research, if you want to
consider the knowledge base from which it needs to be drawn. I would make
that observation to draw into my colleague's question about the importance
of innovation and research to us in this particular sector.
Senator Fairbairn: I sat up quickly when you mentioned Calgary as
we listened to what you are doing together all across the country. I am from
Lethbridge in Southern Alberta, which is near Calgary, and I was wondering
about your activities in that area. It is filled with all sorts of things,
but out on the land, I am curious about the way that you would be pulling
that together — the land and some of other things that are around Calgary.
How does that figure in your work, in what you are doing and how you are
moving in a place like that part of Canada?
Mr. Lemaire: I will start and then ask Ms. Fowlie to follow up.
From a supply chain approach, we look at a range of elements within Calgary,
but also you can translate that across the rest of the country.
I mentioned the diversity and multiplicity of how we operate in the
industry. When we come to Calgary and talk about how we look at marketing or
promoting fresh fruits and vegetables, because we have such a limited
resource base to educate consumers on why and what they should be eating, we
take a broader-scope approach. We cast the net to identify why you should be
eating them — they are good for you, they are tasty and easy to get to —
dealing with some of the food security issues.
We are not in a position to target right down to say eat your potatoes,
your carrots, your bananas or your broccoli, where some of the local outlets
— whether it is retail, health units or others in the community — can take
our support material and deliver more targeted activity to change
consumption patterns and increase consumption. We also need to look across
that entire chain approach, ensuring that industry is being innovative and
It is a very diversified industry, from very small producers to very
well-positioned producers in the Canadian marketplace, as well as others in
the supply chain. That is what creates some challenges relative to how to
move some of the innovation forward as an industry approach. It is something
we cannot stop trying to achieve because if we do not bring the entire
industry forward, none of us will be successful.
The approach on innovation and education from the grower and shipper
through to the packer, the wholesaler and the retailer on areas from food
safety, traceability, product handling, marketing and consumer education are
all fundamental to opening and enabling the right product to be in the hands
of the consumer so that when they walk into the retail outlet or wherever
they are buying, they make the right decision to purchase a product that
will meet their immediate needs for consumption.
One of the areas we have changed our focus on from a CPMA perspective is
children. Our traditional focus for our marketing activities has been the
primary shopper — women from 25 to 40 years of age. Our research has shown
that while we have been successful with the limited investment, our greater
opportunity is the refocusing of our educational materials back into the
schools — working at a provincial level to educate children, through
curriculum support and other tools, on the benefits of eating fruits and
vegetables and linking that into what is available in your community.
To your point of bringing them closer to the farm, we lose sight of that
because of the change and the urbanization in our country. It is not like it
was even 20 or 30 years ago, where there was some connection. Someone had a
relative or friend who was a farmer or had a link to the farm. That linkage
is gone and the understanding of how that operates is gone for many
How do you make them understand what the Canadian food supply chain looks
like, where their food is coming from and why it is important to support the
produce industry for the benefit of their community and nationally?
Senator Robichaud: We talked about poutine earlier. And we need to
make the distinction between Quebec poutine and Acadian poutine. They are
nothing alike, except for the fact that they both use potatoes as a base.
Perhaps we should ask the Library of Parliament researchers to find a recipe
for each version. I encourage people to try Acadian poutine, for that
As for research and development, are there sectors where more could be
done? You mentioned fruit that producers were able to use. What avenues
should we be exploring further?
Ms. Fowlie: There are several. The first thing that we should
point out, however, is the fact that, as a community of producers, we see a
lack of communication between research centres. Researchers in British
Columbia who are doing work with potatoes, for instance, are not all that
familiar with what is happening with potatoes in Prince Edward Island. The
same is also true of apples in certain regions. There is no inventory of the
various research activities that are under way across the country. We need
that kind of information as well, but it is hard to come by.
A number of years ago, the Cark group — which no longer exists — used to
collect that type of information. We really need researchers at Agriculture
Canada, and their laboratories are pretty much the only places where
expertise in certain sectors can be found in Canada.
I use potato blight, or even wireworm, as examples. The expertise of
Agriculture Canada is the only game in the country. There are some things
there that we cannot lose, so how we collaborate and communicate within the
department, and from the department to the user community, needs to be
looked at and improved. We have a very serious concern in that a lot of
researchers are leaving the industry. The next generation is not coming on.
We have a real concern over the gap that will be there in areas like
managing pests, plant health, plant diseases and variety development. We are
losing that expertise, and that will be a huge gap. It will place Canada at
a competitive disadvantage, vis-à-vis countries that are maintaining that
Mr. Lemaire: This is an issue in both government and industry,
with retirements at the public service and the loss of skill sets in
industry. Industry itself is transitioning, and younger generations are not
moving through. The human resource side is a major area that we are both
Senator Robichaud: When you say the new generation is not coming
through to those research centres, where are they going?
Ms. Fowlie: They are either not going into the disciplines in the
first place, or they are going elsewhere. It is a combination of both.
Mr. Lemaire: We are not close to the farm any more. The choices
that many of the younger generation are making are away from the farm.
Ms. Fowlie: There are so many opportunities for the current and
coming generations to have absolutely outstanding and challenging
opportunities and careers in plant science, entomology, food sciences and so
forth, but we seem to be collectively missing the mark in drawing the
bright, young talent out there our way.
Senator Robichaud: You raise a very important point. You started
by highlighting the lack of communication between researchers, but
researcher turnover is also a problem.
Senator Plett: I want to continue a little bit along the line of
your answer to Senator Robichaud.
Land is becoming ever more expensive. I live close to the city, in a
bedroom village. Around my village, farmers are starting to develop their
land. Instead of selling it at $2,000 or $3,000 an acre, they are selling it
at $50,000 an acre if they develop it into two-acre lots. It is a better
living than farming. I know that the people who own orchards in Kelowna
would like to sell their orchards for development, and I think there are
How does that affect the vegetable farmers? If they are trying to make a
living selling their vegetables, but they could simply develop the property
into a dozen two-acre lots and retire, is that a problem?
Ms. Fowlie: It is a concern. It is a business decision that people
are making for various reasons based on their situation, but it is very much
a concern. I guess when we look to sustainability and food security, it is
very much a concern. There is no easy answer. It is a combination of things,
many of which we have spoken about here this morning. We talked about
bringing in talent for research. How do we keep that next generation on the
farm or bring new entrants into farming? For the life of me, I wish there
were an easy answer, a recipe to make some blueberry muffins or whatever it
would take, to answer that. It is a combination of things, and it will take
a lot of commitment and strategic thinking on the part of many.
Senator Plett: We had the dairy farmers here the other day. The
chair or the clerk might want to correct me on this, but they were talking
about their demand. I am not sure whether it was doubling by 2050, but it
was something along those lines. It is irrelevant what the number was. It
was a huge number, and it was going to double by 2050. Will the same thing
happen in your industry, and would that not be a very positive thing?
Ms. Fowlie: It would be wonderful if it would. I think there are
opportunities for growth here and in export markets. There are opportunities
to work with a number of other markets in exchanging technology and
expertise that we have here in Canada. That is part of what the Market
Access Secretariat is looking at doing with various countries. There were
two delegations from Russia here this summer, looking at the potato industry
and how they can work with Canada and look at exactly some of those things.
I believe there are opportunities, and there are a number of factors that
will play into that.
Senator Plett: I would suggest that you put a lot of effort into
exports. I think there are tons of opportunities with other countries,
particularly Asian countries and their tremendous populations. I encourage
you to keep on in that vein.
Senator Eaton: I used to buy tomatoes in Florida, and the Canadian
ones were the best. They had the most flavour. I have been reading about
storage and insecticides. Where does taste rank?
Mr. Lemaire: The taste is a piece of the profile on purchase.
Price is still a driving factor for many Canadians and consumers in their
purchase of fruits and vegetables. As part of that purchase profile, the
product is required to have the right characteristics for colour, texture
and, of course, taste. If we are not providing and addressing the taste
profile, it is very hard to increase consumption relative to the product.
Senator Eaton: I agree; but in the past, have we not emphasized
uniformity, packaging and shelf life rather than taste? Are we going forward
now with taste?
Mr. Lemaire: Taste is a massive piece. We run a national trade
show for the fresh fruit and vegetable industry. This coming April we will
be in Calgary. The show is a cornucopia of product pushing primarily the
taste. The taste of fruit and vegetable, compared to many other products, is
essential for consumer benefit. At the end of the day, if it does not taste
good and bounce off your tongue, you will not come back and buy it again.
The Chair: We thank the Canadian Produce Marketing Association and
the Canadian Horticultural Council for sharing their knowledge. I have a
couple of questions to which you can respond in writing to the committee; we
would appreciate it. We see super structures in food distribution, such as
Walmart and Costco. First, what impact do those stores have on local food
Second, you did not expand on interprovincial trade barriers. The
committee would like to have your comments on this and how we can help to
reduce trade barriers. That links to a supplemental question so you can
share your knowledge and comments with us on NAFTA, especially in Canada.
What can we recommend to government and partners in the U.S. and Mexico to
improve the NAFTA vis-à-vis your associations?