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Proceedings of the Standing Senate Committee on
Agriculture and Forestry

Issue 36 - Evidence - Meeting of June 4, 2013


OTTAWA, Tuesday, June 4, 2013

The Standing Senate Committee on Agriculture and Forestry met this day at 6:15 p.m. to examine and report on research and innovation efforts in the agricultural sector.

Senator Percy Mockler (Chair) in the chair.

[Translation]

The Chair: Welcome to this meeting of the Standing Senate Committee on Agriculture and Forestry.

[English]

I will take this opportunity to welcome our guests, and we will introduce them formally in a few minutes.

My name is Senator Percy Mockler from New Brunswick, and I am Chair of the committee. At this time I would like to ask senators to introduce themselves, and we will start on my left.

Senator Mercer: I am Senator Terry Mercer from Nova Scotia, and I am the deputy chair.

Senator Plett: I am Senator Don Plett, and I am from Manitoba.

Senator Buth: JoAnne Buth from Manitoba.

Senator Eaton: Nicky Eaton, Ontario.

[Translation]

Senator Maltais: Ghislain Maltais, from Quebec.

[English]

The Chair: The committee is continuing its study on research and innovation efforts in the agriculture sector. Today we are focusing on innovation in the agriculture and agri-food sector from the agricultural supply and bioeconomy perspective.

I would like to bring to the attention of the witnesses that in our order of reference from the Senate of Canada we were authorized to examine research and development efforts in the context of developing new markets domestically and internationally, enhancing agricultural sustainability and improving food diversity, security and traceability of our products.

Today, honourable senators, we are honoured to have witnesses from Monsanto Canada, with Mr. Mike McGuire, President.

Mr. McGuire, thank you very much for accepting our invitation. We know you play an important role — your company and your personnel — in moving Canada forward in agriculture.

Accompanying Mr. McGuire is Trish Jordan, Vice-President, Public and Corporate Affairs; and Brian K. Treacy, Vice-President, Regulatory Affairs.

I am informed by the clerk that Mr. McGuire will give the presentation.

Mr. McGuire, following your presentation senators will ask questions.

Mike McGuire, President, Monsanto Canada: Thank you, Mr. Chairman and members of the Senate committee. Thank you for the opportunity to appear before you on the important topic of investment and innovation in agriculture. I am Mike McGuire, President and General Manager of Monsanto Canada, based in Winnipeg, Manitoba.

I am a Canadian who grew up in Ontario. I have been employed in various positions of responsibility within Monsanto Canada and Monsanto's head office in St. Louis for the past 26 years. I have been in my current role, leading our Canadian business, since July 2011.

Monsanto is an agricultural company. Our only customers are farmers and our mission is globally focused on enabling both small holders and large-scale farmers to produce more from their land while conserving more of the world's natural resources such as water, soil and energy. We have summarized that mission as one that is geared toward helping farmers produce more, conserve more and improve their lives, as well as the lives of those who depend on agriculture around the globe.

I thought I would use my time today to give you some brief background on Monsanto in Canada, speak to you about the challenges farmers face with respect to producing food for a growing world population and share with you why we apply science, innovation and technology to help improve agriculture, make it more sustainable and support farmers with the tools they need to be successful on the farm.

I will also speak to the importance of science-based regulations to attract investment and ensure that farmers, who operate in a global agricultural market, have access to the tools they need to remain competitive.

Monsanto Canada employs approximately 280 full- and part-time people in 15 different locations and facilities across Canada. In addition to our Canadian head office and our trait-integration facility located in Winnipeg, we also have an eastern business office located in Guelph, Ontario, a government and regulatory office in Ottawa, a seed manufacturing facility in Lethbridge, research farms in Saskatoon, Yorkton and Edmonton, breeding facilities in Carman, Manitoba; Oakville, Manitoba; Guelph and London, Ontario; and a seed production facility in Cranbrook, British Columbia.

It is at these facilities that our research into enhancing seed germplasm and introducing favourable traits in crops that include corn, soybeans and canola takes place and where we field test the commercial products that have come out of our extensive research pipeline.

These traits include weed and pest resistance, yield enhancements and stress tolerance traits such as drought. These innovations are important to farmers as they help them increase yield and profitability. They also hold considerable potential for the future of agricultural production and are innovations that farmers tell us they are looking to apply on their farms.

When we look at the challenge facing farmers — a challenge that involves feeding, fuelling and clothing a growing planet that is expected to hold 9 billion people by the year 2050 — Monsanto does not see one answer and does not apply just one approach to improving agriculture for farmers. We are best known for our advances in biotechnology and since 1996, farmers have used our biotech seeds to increase yield in important crops such as corn, soybean and canola.

Canadian farmers are among the strongest supporters and largest adopters of biotechnology, but increasingly, small-holder, resource-poor farmers in countries such as India, China, the Philippines and parts of Africa are embracing GM seeds. Today, there are 17.3 million farmers around the globe making the personal choice to grow their crops with the benefits of biotechnology.

However, biotechnology is only part of what we do. We also apply other innovations to improve agriculture. One of these innovations is developing new ways to improve traditional plant breeding using modern science to accelerate the age-old practice of creating better plants by selecting the most desirable traits in existing plant populations. The best technology cannot return benefits for farmers unless it is used in strong seed germplasm. With tools like molecular markers, we are able to identify desirable characteristics in plants and bring them to farmers faster than ever before.

Other improvements are achieved through agronomic solutions that we offer to farmers, such as chemistries, biologicals and equipment technologies. Monsanto spends $3.8 million a day in research globally. In Canada, we are investing about $15 million annually in corn, soybean and canola breeding research — all aimed at giving farmers the tools they need to be successful. We see our contribution to agriculture as one in which we ensure that agriculture remains a vibrant and successful industry by analyzing the problems and challenges of agriculture and then applying human innovation to find solutions and bring new crop options to farmers.

The benefits that farmers have realized since the introduction of biotech traits in 1996 and those they will see in future traits will only come if we are in a position to complete the necessary lab and field research required to confirm economic and environmental benefits for farmers and safety for humans, animals and the environment. It is because of existing science-based regulatory policies, which facilitate trade and investment as well as respect for property and intellectual property, that farmers in Canada have access to the tools they need to compete with farmers in other countries around the world. In this respect I want to applaud the efforts of the Government of Canada toward defending the principles of science-based regulation. This is not always easy in light of regions such as Europe that continue to have a dysfunctional regulatory system that sometimes prevents the entry of beneficial Canadian agricultural products. Canada remains a world leader in biotechnology research and innovation because of a regulatory framework grounded in science. Monsanto and our farmer customers strongly support this focus.

I believe you have heard from groups like CropLife Canada and others in the agricultural sector who share this view. More important, this science-driven position is also supported by the large majority of farmers and commodity organizations in Canada. Our system is held up as a model for other world areas and has brought substantial industry and research investment to Canada.

We believe it is important to have Canadian federal regulatory agencies review the food, feed and environmental safety of all products of biotechnology. We believe the government should publicly defend its system and explain its safety record to Canadians. We have a fantastic track record of ensuring human, animal and environmental safety of agricultural commodities, and we should not be afraid to defend the system. That system allows farmers to produce some of the safest food in the world, and there is a benefit for consumers too in that it ensures they have access to an abundance of safe high-quality food that is affordable for Canadian families. CropLife Canada states that Canadian families save 50 per cent on their weekly grocery bills thanks to modern agriculture.

We are very concerned to see provincial and municipal attempts to impose additional regulations on agricultural seeds and technologies determined to be safe by federal agencies. One only need look to provincial and municipal pesticide bans to see this is a real issue. More recently, there was a GMO ban put in place on Vancouver Island. These actions discount the important and credible work you do and ignore the large body of scientific evidence that shows plant science innovations are safe. More damaging is that they potentially withhold beneficial crop technologies from Canadian farmers.

Federal support and leadership are needed to convey to other jurisdictions that science-based principles ensure predictability across Canada and reduce the risk of Canada losing investment. Farmers need continued access to safe, beneficial technologies. They need and want the right to retain the freedom to choose the tools that allow them to thrive, run successful farm businesses and support their families and communities.

Since their introduction in 1996, more than 2 trillion meals containing biotech crop ingredients have been consumed without a single reliably documented case of harm to humans or animals. The continued review of these technologies for food, feed and environmental safety using a science-based system sends an important message to our customers around the world that Canadian agriculture embraces innovation and technology and that these products are comprehensively reviewed and safe.

As Monsanto's lead for Canada, I advocate for Canada and Canadian farmers every day in order to attract internal investment because my colleagues are doing the same globally — fighting for investment to go to their farmers in Brazil or Argentina or China or India. As a Canadian, I want that investment to come to Canada for the benefit of Canadian farmers and the Canadian agricultural economy, but it is getting harder.

This year, Monsanto invested more than $1 billion in research and development to develop the most robust pipeline of products in the industry. Today, our researchers throughout the world are actively working to discover, develop and deliver the next generation of agricultural products so farmers can get more out of each acre of farmland while lessening agriculture's impact on the planet.

The world only has an additional 8 per cent to 10 per cent more arable land that could be used for agricultural production. Soil and water resources are growing increasingly scarce, so we need to equip farmers with the tools to allow them to produce greater yield on less land with fewer inputs.

Our farmer customers have been very clear about what they want from Monsanto. They want us to continue to invest in research and development to help bring innovative approaches to the farm. They want top-performing seeds and trait choices in all areas of the country, and they want a broad array of product choices across all crops.

As a company, we recognize that we can be successful only if we provide our farmer customers with products that add value to their farming operations. Since the mid-1980s, there have been more than 50,000 field trials of genetically modified crops in 45 countries around the world. In commercial terms, the rate of adoption has far outpaced the introduction of any other new technology in agriculture. Following extensive safety evaluations over many years, a total of more than 580 million acres have already been grown commercially across North America, South America, Africa, Asia, Australia and Europe. Humans and animals around the world have consumed an estimated 600 million tonnes of GM crops.

These are some of the reasons that Monsanto continues to invest in Canadian agriculture and work with the industry to find solutions to allow new technologies to be brought forward in a positive and responsible manner, respecting the individual choices that farmers want to make on their farms.

The research we have undertaken internally with academics and other third party researchers to bring new biotech traits to crops like corn, canola, soybean, alfalfa, sugar beet, wheat and vegetables indicates that Canadian farmers are searching for new, more economical sustainable options to enhance their yields and their profitability.

Biotech crops and modern plant breeding techniques have offered farmers a compelling value proposition, including product effectiveness, yield improvement, simplicity, conservation tillage enhancement, cleaner grain, no crop restrictions and a solid track record of environmental safety.

Canada must continue its leadership position in the agricultural sector by defending its science-based regulatory system and challenging unjustified trade barriers that are inconsistent with WTO rules. We have been encouraged by the positive feedback we have received from Canadian farmers and indeed farmers around the globe. We remain fully committed to working with industry and government to find manageable and effective solutions to allow the benefits of biotechnology to be shared with farmers, industries and consumers.

I want to thank the committee for taking time to look at our industry and ask the questions that will help keep it vibrant in the years ahead. The future development and investment in crop technology research in this country is obviously important to our business and to farmers, and we want to work cooperatively with our industry colleagues and farmers to continue to bring forward innovative products that will benefit the agricultural sector in this country.

The Chair: Thank you, Mr. McGuire.

Senator Mercer: Thank you for being here. You are an important witness for us. The role of your company in the agricultural sector is well known. You have underscored the 9 billion people we will have by 2050 and highlighted the fact that there is only 8 to 10 per cent more arable land that can be brought into production. If we are going to feed 9 billion people, we have to find new ways to do that, and obviously new technology will help us.

Europe's opposition to genetically modified products is an ongoing concern. Do you see any progress at all in the acceptance of GMOs in Europe? You obviously monitor it closely and would be anxious to get into that market if you could.

Mr. McGuire: That was a great question. We see Europe as a market today that is looking for improved deals. In today's environment, where biotechnology is not an option, we have actually increased our efforts in traditional plant breeding across Europe in markets where biotechnology is not available to growers.

Our commitment is to provide growers the tools that are available in any region to improve their yields. In Europe, our focus is on traditional plant breeding, and we have made great gains. We believe farmers there could benefit from biotechnologies and some of the advantages they offer to growers in other parts of the world. We believe that eventually that will come to pass but, in the current state, we believe that our best approach is to work with the tools that we have that are accepted in that region.

Senator Mercer: You can help educate me, at least, if not many of our viewers. You talk about the best technology cannot return benefits for farmers unless it is utilized in strong seed germplasm and with tools like molecular markers. Do you want to explain what a molecular marker is and how that will help?

Mr. McGuire: I will start the question and then defer to Mr. Treacy to answer the science-based questions.

We have seen an evolution of knowledge and use of new techniques to actually look inside the plant in a different way, differently than we ever could have in the past. As a non-scientist, as I started my career in agriculture 26 years ago, before biotechnology, progress was slow. Breeders looked at plants. They kicked them. They washed the ears and did tons of trials hoping to find that magic plant, and a lot of it was visual. We have moved past that to a point where we actually can use new tools to speed that process up. A lot of it is using tools like molecular markers. In terms of the science, I will defer to Mr. Treacy.

Brian K. Treacy, Vice-President, Regulatory Affairs, Monsanto Canada: Thank you for the question. I think Mr. McGuire did a good job of explaining breeding and how it has evolved over time.

He is absolutely right. In history, we have employed breeding to advance agriculture through visual means, what we call a phenotype. The phenotypes that we see, tall plants, higher yielding, are all based on genes and traits that we call the genotype. What we can now do in the lab is link a particular visual improvement to the plant with the particular gene or trait, and we can map this a bit like a library. Without having to grow out the full plant to see the visual effect of the plant, we can now test in the laboratory multiple generations all in one year and significantly advance using information technology to link up and enrich all of these beneficial traits in the plant.

Mr. McGuire: The other way I would look at it, from a non-scientific view point, is that we understand now, with a lot of advances, whether they be in human genotyping or plant genotyping, what functions various genes have within the plant. Understanding the functions of those genes lets us link that knowledge back to which genes help contribute to higher yield so we do not have to actually grow and look for those things in the field. We have a higher probability of having those things happen knowing which genes are present in those plants and then growing them to reap an improved variety.

Senator Mercer: I am curious about this no GMO ban put in place on Vancouver Island. How does that play out with some of their existing industry? They have a growing wine industry there and are growing more and more grapes every year. Some of those grapes must be genetically modified in some way.

Trish Jordan, Vice-President, Public and Corporate Affairs, Monsanto Canada: The recent trend for some smaller municipalities or different municipalities within provincial jurisdictions tends to look at this issue more from a social perspective than a science perspective, and it has become very political. When they generate enough momentum, it has become symbolic for them to say, "Our region is going to be non-GMO."

What it does not take into consideration is exactly what you have identified, that farmers or industries within that same region may be utilizing the benefits of that technology. I think it is symbolic, and they are not able to actually engage farmers in the discussion, for whatever reason, so it will be interesting to see whether this actually has an impact on agricultural production in those particular municipalities.

Mr. McGuire: If it were dairy production in that area, those growers would not have that option.

Senator Mercer: I would imagine the unofficial crop in B.C., B.C. bud, probably has some genetic modification.

Senator Plett: Senator Mercer and I know a little bit more about the grapes in British Columbia today than we did a week ago. It was a wonderful experience.

My first question was about the GMOs and how we were doing in Europe, and the second one was about molecular whatever it was, so I think Senator Mercer read my notes. I will move away from there a little bit.

First of all, thank you all for being here. It is wonderful to see fellow Manitobans here. We appreciate that.

You did talk about our involvement globally and what we need to do to enhance and continue in order for our farmers to do better. Locally, we need to do better globally. I am curious as to how we are doing globally and what we as a government can do to help with some innovation technology so that we can play an even bigger role. Where do we fit in the grand scheme of things globally in comparison to some of the other countries that you mentioned?

Mr. McGuire: Canada has been recognized as one of the places where growers appreciate the benefits of biotechnology. As a Canadian, one of the things that we try to do as a Canadian organization is make sure that those products are launched in Canada as quickly as they are launched anywhere else in the world. A bad day for me is when American growers have the technology before Canadian growers. That is an internal perspective that the Monsanto people have. We have a passion for making sure that our growers have access and are competitive with the people they have to compete with in the world markets. That is the way we approach it. It has been great because the approach we have had through the regulatory system has been predictable, well-thought-out, well-supported, timely launches.

The Canadian regulatory system has allowed us to, probably in the last six years, launch every technology in Canada at the same time as in the U.S. We are not as big a team and do not have as many people, so it is a little bit harder for us. However, I think that we give Canadian growers every advantage as quickly as the American growers, who typically are first out of the chute. That being said, that took us up to about two years ago. Previously, a lot of the South American governments were pretty slow. Brazil was pretty slow to get things approved.

Brazil has really ramped up and supported their regulatory system to the point where they have the manpower and the resources to do a complete regulatory approval probably a little more quickly than we can in Canada. Now, we have a situation where there are some growers in other parts of the world that are probably a little faster out of the chute than even our growers. That was where I described the example of when I have to go to our head office in St. Louis and ask for investment in Canada. They say, "Maybe we could get something to market a little faster in Brazil." I am actually competing internally for funding.

We have been the poster child, historically, for getting there first, and there is a little pressure on that right now, I think.

I do not know if you, Mr. Treacy, have any comments.

Mr. Treacy: Yes, I would like to add to that. Number one, I would like to applaud the Canadian government for enabling innovation. It is the science-based regulatory system that enables that innovation, and, to Mr. McGuire's point, Canada is a leader. When I talk to my colleagues in Brussels or in South Korea, it is a different ball game. It is not predictable. It is not based on science. It is highly political. It becomes a trade barrier or a tool for a trade barrier. That said, I would say Canada has the top regulatory system in the world. Having said that, to Mr. McGuire's point, Brazil and Argentina are really moving forward, and they are becoming a little bit faster than Canada.

Moving forward, I would encourage the Canadian government to continue with their regulations that are based on science and also to continue to do the work they are doing in policy development. I believe that they are a leader in developing policy and capacity building. Examples include capacity building in China and in developing countries in Africa and also developing international policy around — I do not know if you are familiar with it — the policy of low- level presence. This is an example where Canada has taken a global lead, and the world is watching. They respect Canada as being an honest broker globally, and so, for that, keep doing the great work.

Senator Plett: I would also like to applaud the Government of Canada, so we are certainly on the same team there.

You mentioned — and I found it a little disconcerting — that we are having some problems with provincial and municipal governments.

What can the Government of Canada do to help alleviate some of the obstacles you are experiencing? On a more personal note, is my government in Manitoba a large obstacle to you?

Mr. McGuire: I will start.

Senator Plett: You will give her the tough one.

Mr. McGuire: Ms. Jordan has been on some provincial committees on the pesticide ban.

A good day for us is when products deemed safe at the federal level have access to all markets in Canada. It goes back to my whole discussion around going to my head office in St. Louis and saying, "I want money for investment," and them wanting to ensure that the products they develop that are deemed safe can be sold everywhere in Canada, that it is predictable and that all markets are open to us. Having a second tier of what seem like approvals on products deemed safe becomes an obstacle for me and for my quest to attract investment in Canada. That is why it is an issue for us.

I think maybe Ms. Jordan can speak to where we stand in Manitoba and other jurisdictions.

Mr. Treacy: I have one point just before she jumps in.

I wanted to add something about the differences between the provinces and the federal government. From my perspective in regulatory affairs, if you approve a product at the federal level for food, feeding environment or registration for a particular chemistry and then it is banned in a particular province, in our view, it erodes the confidence in the regulatory system. People start asking questions. That is something that can be lost very quickly, and it puts doubt into the mind of the public.

Mr. McGuire: There are 300 scientists, federally, who do great work to improve the products. For local jurisdictions to politically decide to ignore that work really diminishes the value of those people doing that work.

Ms. Jordan: At the provincial level, specific to Manitoba, we have been working quite hard in terms of trying to have dialogue with the provincial government on issues around the use of biotechnology and of pesticides.

They are currently examining the issue of a provincial pesticide ban for what they call cosmetic use. We do not personally believe that there is such a thing as a cosmetic use of a pesticide. They are used for very specific reasons, both by farmers and urban consumers, to kill pests in their homes or weeds on their lawn.

I will say that we have not made very much headway with our provincial government in Manitoba. They are on a track that they believe needs to be passed in terms of implementing a pesticide ban. To our concern, again, they are ignoring the good work that Health Canada has done. They are referring to what we would call quasi-science or pseudo-science to support their position. We were recently able to meet them to again express our concerns and to ask questions about their proposal.

We also spoke to the Minister of Agriculture about the province's position on biotechnology, and, again, they hesitated to actively support it, which is surprising when you consider the adoption rates of a wide variety of biotech crops in Manitoba. They grow corn, canola, soybeans. Soybeans have expanded quite significantly in Manitoba. Clearly, the farmers have indicated that this is something that they want, and they are just concerned about the crossover of a municipal concern with the agricultural sector.

Senator Plett: Thank you very much. If there is a second round, chair, I have a few more questions.

Senator Tardif: Good evening. Food security is an important issue in many parts the world, and, as you indicated in your presentation, the world only has an additional 8 to 10 per cent of arable land that could be used for agricultural production. What criteria do you use to determine the weight that you give to the profitability factor, versus the social and environmental factors, in the products you develop?

Mr. McGuire: We have determined that many of the technologies we make available for large-scale modern agriculture are also a really great fit for small-scale agriculture. I will give you an example: If you recall, last year was a very hot dry summer in the Midwestern U.S., and there was significant crop failure. This year, we are launching a new technology called drought guard in corn that will provide a measure of drought protection in years similar to what we experienced last year. That is a technology that will have great commercial value for us and for growers and give us security in that food supply. That same technology is one that we have donated to the Bill Gates Foundation.

We have donated the technology. We have plant breeders working with the Bill Gates Foundation to take that same technology to Africa and underdeveloped countries for small stakeholders. Our concern there is that these are not people who want to grow crops to sell them. They want to grow their own food, and, to us, that is an incredibly important aspect. When we look at these technologies, generally, most of the technologies we develop have carryover, and we can use them in two different ways. That is a great example, and I believe the technology in Africa will be launched next year.

Mr. Treacy: It will probably be in about three years.

Mr. McGuire: We are into field trials in developing varieties. There is a nice crossover that a lot of things we can do for large-scale agriculture also have a great place in terms of small-holder agriculture, and the key thing for us is that these are not people trying to grow crops to sell them to make money. They are trying to grow their own food supply.

Senator Tardif: I know the production of genetically modified alfalfa has been improved in Canada since 2005, but it has not registered with the Canadian Food Inspection Agency for commercial reasons, if I understand correctly. The approval of Roundup alfalfa in the United States in 2011 has been done, but many Canadian organizations such as the National Farmers Union and the Canadian Biotechnology Action Network fear the registration of Roundup Ready alfalfa in Canada and fear it will contaminate the organic crops. Do you feel their fears are justified?

Mr. McGuire: I will speak first to our commercialization efforts and the history.

When Roundup Ready alfalfa was first approved in Canada, we were not certain that there was a commercial market or commercial need for the product, so we did not commercialize immediately. We went back and determined at some future point the growers were asking for that technology. Once it was launched in the U.S., growers found it was successful and added value. We re-evaluated our situation in Canada and decided to move on a commercial track to do all the things so we could be prepared to sell it in the market and complete the final approvals that were required in Canada. We have taken a measured approach.

The approach was broken into two segments. There is one market in Eastern Canada, which is really just a commercial hay market. There is also a market in Western Canada where alfalfa seed is grown. We decided to look first at the market in Eastern Canada where farmers only grow it for hay and there is very little or no seed production, and the issue you described would not exist in terms of having seed production in the same area. Currently, we are looking at potentially launching that product in Eastern Canada. I believe the first variety was registered with CFIA recently. We have not launched it commercially yet, but we have worked with organizations like the Canadian Seed Trade Association, which represents all seed production companies, including the smaller companies that do organic production, and worked with them to develop a set of coexistence guidelines. We committed not to launch our product until we had gone through a stakeholder process to get the opinions and best practices so that we could launch the product responsibly.

That has been where we have taken it so far. In terms of the probability and mechanics of pollen flow and how the crop reacts, I will ask Mr. Treacy to comment.

Mr. Treacy: I had the pleasure of meeting the Honourable Wayne Easter a couple of weeks ago as part of CropLife Spring Dialogue Days, and he had a similar question. We talked about a couple of items that I will share with the committee today.

It was Mr. Easter's understanding that there was not enough dialogue on this particular product, and that sort of came up as a surprise. We talked a bit about transparency, and I articulated to Mr. Easter that through the Canadian Seed Trade Association, we have been giving regular updates once to twice a year for the past 10 years with opportunity for input on the technology.

We also talked about coexistence and a plan that exists in the U.S. that supports the current commercial production in the U.S. and how we are developing a plan in Canada. We will Canadianize it to make it Canadian-specific, and this plan is in development through a broader working group within the Canadian Seed Trade Association. There will be more discussion, I believe, at the meeting coming up in July in Quebec City.

We also talked about U.S. production. Right now, Forage Genetics International is the seed company. We have the Roundup Ready gene, if you like, in alfalfa. We are sort of the Intel chip in the computer, so to speak.

FGI, and they communicated this at the Canadian Seed Trade Association, services the conventional alfalfa market, Roundup Ready alfalfa, as well as the organic market, and they have been able to do so with no disruptions following the coexistence plan that they have in place.

Now, just to follow up on Mr. McGuire's comments regarding pollen drift and that sort of thing, I would say that the overwhelming majority of alfalfa acres, 99 per cent plus, are for Forage production, and, in order to harvest for maximum nutrition, maximum protein, you harvest at around 10 per cent bloom, so roughly 10 per cent of the field is in flower, which drastically reduces the opportunity for pollen flow.

Furthermore, there has been research in private and public institutions on pollen flow in alfalfa for the past 25 years, and it is well known. It turns out that for alfalfa, the pollen is not windblown, but it is thanks to bees that pollinate. It is not all bees but leaf cutter bees in particular that play a physical role in transporting the pollen, and these bees are introduced into the fields to allow pollination to occur.

Taken together, we believe that with stewardship programs, a coexistence plan and what Mr. McGuire just touched upon, an east/west divide in terms of Forage production versus seed production in Canada, there is an opportunity, should the market demand it.

Mr. McGuire: One of the other things we looked at when we talked about the decision to commercialize was going back to the conversation about being competitive with U.S. growers. We could see that U.S. Forage growers would have an advantage not just currently but in the future because new technologies are coming in alfalfa.

Once Roundup Ready alfalfa is introduced, there is new technology coming called "low lignin," which increases digestibility of alfalfa. People who use alfalfa for feeding their cattle would benefit from this new and improved alfalfa product. Our thinking was if we did not start getting alfalfa moving forward into the 21st century, our Canadian dairy producers and beef producers would be at a disadvantage because this new beneficial crop would not be available to us in Canada.

Senator Eaton: Thank you for coming. You certainly do absolutely outstanding work, but we certainly have a Canadian trait where we do not always advertise ourselves.

I live in Toronto where, as you know, probably pesticides are banned, the way they are in Vancouver. What I do not remember seeing, and we have talked a lot about it at this committee, are future free trade deals either with the EU or with Japan, Korea, et cetera.

I do not remember ever seeing Monsanto advertising itself. A lot of ecoactivists live in the East, and I remember talking to the oil sands people about how much misinformation is put out there, and they say, "Yes, we are advertising in Calgary." Yes, but a lot of the money comes from the East that finances those activists.

Do you have campaigns? When you see something like Vancouver trying to shut you down, do you advertise what you are doing, how you are science-based? I notice for the oil sands finally the penny has dropped; it is almost too late. They are now beginning to show what good things they are doing.

Do you do that? Do you go into schools to try to get children at a young age where they are open to things like science?

Mr. McGuire: The interesting part is that Monsanto had spent, I believe, almost $1 billion in biotechnology before we even knew that we could actually do it. Back in the 1980s, Monsanto made a huge investment, a huge leap of faith by people, to try to create products that we were not sure could exist. They were successful, and we were years ahead of the industry because of that vision. That was a benefit. It was also the reason that we are the poster child for biotechnology because we were first, we were innovative and we were the leader. Since that day, many other companies have developed, such as DuPont, BSF and Bayer. There are many other people that you will be hearing from in our industry.

Senator Eaton: Yes, but you are the one whose name we hear.

Mr. McGuire: I will just say that we are the people who are the lightning rod. We have determined that there is an approach that does not necessarily mean we should be speaking on behalf of the industry. I will ask Ms. Jordan to speak to that approach.

Ms. Jordan: Thank you for the excellent question. It is something that I deal with on a day-to-day basis from a public affairs perspective and from a consumer acceptance perspective.

We like to work with industry associations because there are many players in this market that are doing the exact same thing that Monsanto is doing. We feel that we are a credible voice, but in that kind of toxic environment we are not perceived as being credible. We will always stick up for science and we will defend our products because we know they are safe. We will also defend the farmers' rights to those products.

What we have tried to do, in terms of helping people understand that it is not a black and white issue and there are two sides, is engage farmer groups and work with others in the industry who hold a similar view of these technologies.

To your point around the mass of questions and concerns around Monsanto specifically, we do know that there is a concerted, orchestrated, multinational, anti-biotech group that is focused on biotechnology and specifically Monsanto. They have access to about $2.4 billion U.S. dollars in revenue to create fear, concern and misinformation. We will spend some money on that but we would rather spend the money on developing beneficial products for farmers. We cannot compete with that on a public affairs perspective.

Senator Eaton: I would ask you to consider the politics and so often business is so good at what they do, the way you are, but you forget the equation of the political optics, the consumer and the voter in Vancouver or downtown Toronto who will vote out of ignorance because that is what they are told and they do not hear the other side of the story.

Ms. Jordan: I do agree and we certainly appreciate the advice.

In relation to the second part of your question, I will say that there are many things we are doing as a company working with partners. We work with a number of groups called Agriculture in the Classroom, and not specific to biotech but just to help children from grade 1 through to grade 12 understand what modern agriculture is all about and understand all components of agriculture from organic to fruit and grain production to using the benefits of biotechnology.

We have lots of science and agricultural education programs that we support. We have tried to find the groups and the organizations that are already working in this area and then ask them whether we can help and how we can help. We are trying to expand the voices in that regard.

A recent issue we are also considering as an industry through a North American organization called BIO is similar to what McDonalds did with their website. I am not sure if you are familiar with that, but it is basically opening the kimono, being completely transparent and saying "we welcome your questions." That is something we will likely launch within the next six months and say that we have nothing to hide. We are proud of our products. Farmers are using these products because they have benefits and we are prepared to answer questions.

That would be an example of a type of program where we would be a little more proactive in terms of trying to address people's concerns.

Mr. Treacy: We actually have a department within the company called Scientific Affairs and, as Ms. Jordan mentioned earlier, as much as we explain our technology and talk about the benefits, in the social media we just do not come across as credible. Scientific Affairs is focused on reaching out to academics and we are going after top scientists around the world. We are also working with government extension. We are collaborating with academics and government extension to do work, but also serve as advocates. Not all researchers want to be advocates of the technology and be vocal, but this is something that is growing. That is number one.

Number two, we also have a grower advisory council. This is a panel of 12 to 15 of the top growers in Canada, representing all of the different sectors in agriculture and we update them with new products in the pipeline, seek their feedback on how to roll it out and how we can do better.

Senator Eaton: I have been on the Agriculture Committee since I joined the Senate in 2009. I have never had anybody from Monsanto come to my office, and I have had everybody from firemen to doctors who have all come.

Do you come onto Parliament Hill? Do you go around to parliamentarians? Are you going to the EU parliamentarians? Do you sit down and talk to people?

I am sorry. I feel strongly that you have such a good case and you are not presenting it, but thank you.

The Chair: Good comments.

Senator Merchant: My question is actually a supplementary question about alfalfa. I come from Saskatchewan and I know that there is great concern out there, particularly about the contamination of crops. It is fine to say that this will start in Ontario but, as you very well know, 87 per cent of Canadian alfalfa is produced in the West. Western farmers should have a role to play before you make all these decisions. I understand that there are honey bees that can also disseminate the pollen.

The farmers out there are very concerned about this. Are the National Farmers Union and the Canadian Biotechnology Action Network large organizations that are opposed to the GM alfalfa or are they small organizations?

Ms. Jordan: The Canadian Biotechnology Action Network is an organization that is fundamentally opposed to the introduction of science and biotechnology in agriculture in any crop of any type. I would argue that they have a biased perspective.

The National Farmers Union is a very small farm organization. I do not believe at all that they represent the majority of the interests of farmers in this country. Organizations such as the Grain Growers of Canada probably represent a significantly higher number of farmers. That said, we have always been open to having conversations with groups like the National Farmers Organization on issues of either organic, conventional or biotech crop production. Generally speaking, the NFU has policies that are opposed to biotechnology and we respect their right to choose what works best for them on their farm. However, we believe there are ways that both types of farming can co-exist. It is really not one or the other; it is doable to have both options.

Mr. McGuire: In the U.S. we are successfully doing and have successfully done exactly what we would propose doing in Saskatchewan for a number of years now so it has coexisted. The same company that produces organic and conventional biotech seeds can do it all as one company. There is a model that says it can be done responsibly, effectively and efficiently. As long as we can have a respectful dialogue we are open to having that, but if the option is "we just don't want it" then it is a tough starting point for us.

Senator Merchant: Thank you. I appreciate your answers, because they have been contacting us, to hear it from your side. They have a side obviously, too, and they are not here. I thank you for your answers.

Senator Buth: Thank you very much for being here this evening. I would like to go back to the comments of Senator Plett in terms of business development and the competition you experienced in trying to bring dollars into Canada.

You mentioned science-based regulatory systems and the importance of that and, Mr. Treacy, you mentioned the leadership in terms of a global policy and a low-level presence.

Could you comment on UPOV 1991 and its adoption, whether that is important to you? We have heard from other witnesses on that. Could you also comment on some of the other programs that the government offers?

I also sit on the National Finance Committee, and this morning we heard from the Chemical Industry Association of Canada. They talked about the use of things like SR&ED and the accelerated capital cost allowance. If you could comment on those, it would be helpful to understand whether those programs are valuable to you.

Mr. McGuire: I will comment generally on UPOV, but I think that really speaks to intellectual property protection. In an industry like ours, where you make very large investments in research and development, you need to have some assurance that those inventions will be stewarded and that you will be able to reap the value from them in a predictable way.

To have the most current, up-to-date protection, as might be experienced in other parts of the world, is very important to us. It is one of those things where, if it is not a level playing field, it is a box I cannot check when going to the U.S. to ask for dollars.

It is interesting how there are a number of boxes you need to check, and if you check more boxes you have a greater probability of securing funding for Canada. It is an issue we have talked about to ensure we are as up to date as the rest of the world, but we need to move forward and ensure we are at the right place.

I think your second question revolved around other things that can be done. It is a great question. I think, as a privately held company, maybe we do not always look at what is available to us. We have started very recently to look at programs that are available, where we could match our funding. I think recently there are some programs that seem pretty innovative and will allow companies like ours to invest more in Canada by having support in other programs.

To us, it is a bit of a new area. We have tended to think that we will do it on our own, but I think we have a couple of things in the pipeline where we have submitted and looked, and I think it will help us get to places faster. I can take the money I get from St. Louis, match it up with more money, and get to a better place faster. Those are new thoughts for us, and I think there are probably new sources of funding that were not there before.

Senator Buth: In terms of the amount of time it takes to develop varieties, you were involved — and you commented that you are involved — in Europe in terms of traditional breeding. Even though there are things like marker-assisted selection, you clearly have the experience in terms of traditional breeding versus biotech. Can you comment on the length of time it takes to bring a product to market using those two examples?

Mr. McGuire: It is an interesting process, because the process of plant breeding, from the day you want to improve a variety to the day you bring it to market, the timelines are almost identical. The number of years it takes, using even the new tools, to bring a new set of genetics to the market is seven to ten years. From the day you decide you want to introduce a new biotech trait, for example resistance to a new pest, is about seven to ten years.

We have a parallel path where, while we are developing the biotech trait, we are also developing the variety it will go into, separate pathways almost equally funded. At the end of the day we bring them together at a facility in Winnipeg called our trade integration facility. We have a facility in Winnipeg that takes the new trait, the improved genetics, and at the tail end of the process puts them together. It is interesting that it is the same timeline.

Senator Callbeck: Thank you for coming this evening.

My first question is a simple one. I have heard it said often that Monsanto seeds are only good for one year and that they cannot be replanted; is there any truth to this?

Mr. McGuire: I will start with the question. When Monsanto introduced the concept of biotechnology, we also introduced the concept that a grower would pay for that technology on a yearly basis. There was a benefit to these new and improved seeds, and a grower could make the choice to buy those new and improved seeds and use them for one year and then choose to repurchase the next year.

The seeds are viable for more than one year. There is no physical way that they will not reproduce. We introduced a concept of a contract whereby the grower agreed to only use them for a single season and, if he liked the performance, he would be free to come back and choose for a second year. No physical means that they will not be able to grow, but the grower would knowingly make that choice at the beginning of the season each and every year.

Mr. Treacy: To add a technical piece to that answer, it is all about hybrid vigour. When you have parent A and parent B and you develop a hybrid, the hybrid will yield higher than A as well as B taken together. Mr. McGuire is right: You could save that seed and grow it again, and there is evidence to demonstrate that you lose that hybrid vigour in that second generation, so you do not get the same level of yields.

Mr. McGuire: That was the process before biotechnology as well.

Senator Callbeck: What does the evidence show? You say you do not get the same level of yield, but what would be the difference, roughly?

Mr. Treacy: I would have to follow up with the committee in terms of exact numbers.

Mr. McGuire: I can comment on corn, as an example. In corn, if you take an improved hybrid, a grower may receive 200 bushels an acre. If he were to plant the seed from that crop and lost the hybrid vigour, he may get 40 to 60 bushels per acre. That has been sort of the science of hybrid development.

Hybrid corn was developed in the 1920s. That process has been the same since 1920, when people first developed how to make hybrids in corn, that same differential.

Senator Callbeck: I think it was last week in Oregon that an unapproved strain of your GM wheat was found by a farmer in a field, and there had not been trials there since 2001. Where do you think it came from?

Mr. McGuire: That is incredibly recent news, as of last week. The key points there are that we were asked by the USDA to cooperate and provide testing mechanisms to understand if it was Roundup Ready Wheat. We did those things and provided it. Their initial claim is that it is Roundup Ready Wheat.

The most important thing is that it was already approved as safe for consumption, so it is a safe product. We never commercialized it, but it was a safe product.

We ended up discontinuing that program nine years before. I think, in that time, 500 million acres of wheat have been grown, and this is the first place where there seems to be an instance, a small 80-acre field, where some plants survived. There is an ongoing investigation. We are trying to understand what it is, how it could have happened and some of the reasons it could be existing there. It is early, and we are investigating.

Senator Callbeck: Have you ever done trials in Canada on that particular product?

Ms. Jordan: Yes, we conducted trials on Roundup Ready Wheat from 1998 through to 2004 on spring wheat. This finding in the U.S. was on winter wheat. We have never conducted winter wheat trials in Canada.

Mr. McGuire: The product, winter wheat, that was discovered was never tested in Canada.

Senator Callbeck: The fact that that strain was found certainly had some market consequences in the way some countries responded. What are you doing about that?

Ms. Jordan: There is a market concern, even though there is no food safety concern, so we have made event-specific testing mechanisms available to key importing countries that have very cautious approaches to this whole issue. Japan, for instance, is very concerned. South Korea and China are two others that I can think of. They employ those tests now and have tested recent shipments and found no presence of the trait, which is obviously very encouraging. The initial reaction was one of caution. We have to let this play out to see what the long-term impact, if any, is on trade.

[Translation]

Senator Maltais: In principle, is it true that no GMO wheat is sold for human consumption?

[English]

Mr. Treacy: That would be correct. There is no commercial GM wheat today.

[Translation]

Senator Maltais: I would like to pick up on what Senator Callbeck was discussing with you. Was what happened in Oregon due to the fact that your product was not registered?

[English]

Ms. Jordan: Is that why there was market concern because it was not registered for commercial sale? Yes. It had full regulatory approval.

[Translation]

Senator Maltais: If I understood correctly, your product was not registered.

[English]

Ms. Jordan: It was not registered for commercial sale.

[Translation]

Senator Maltais: Why did the U.S. government have to pass legislation to allow the production of genetically modified plants that were not registered, specifically for you, the Monsanto Protection Act, as it was called?

[English]

Mr. McGuire: The work conducted was pre-commercial to identify the safety and benefits under controlled stewardship and government guidelines. It was not intended for commercial sale. The work was pre-commercial developmental work. Monsanto decided not to commercialize those products, discontinued the program and followed USDA guidelines in terms of stewarding the shutdown and destruction of all fields and seeds produced during the time when we were evaluating the technology. We are assessing the documentation, but we were stewarding it in its discontinuation according to all the approved guidelines. We never sought to have it approved for commercial sale, but we had reached the point where it was approved as safe for consumption.

[Translation]

Senator Maltais: Mr. Treacy, you said earlier, in relation to alfalfa, that pollen was not windblown but transported by a particular type of bee. Can you tell me what type of bee that is?

[English]

Mr. Treacy: You are correct. We understand from people who look at pollen flow in alfalfa that it is a specific type of bee called a leafcutter bee. I understand that beekeepers breed leafcutters and introduce them into the fields to facilitate pollination of the crop. They are leafcutter bees. Some work is done by honey bees but the vast majority of pollination in alfalfa is thanks to leafcutter bees.

Mr. McGuire: Honey bees do not fit in the plant.

[Translation]

Senator Maltais: That is an important point, because some people eat honey and have no idea that it contains genetically modified products. The leafcutter bee produces honey. The honey is commercialized using genetically modified products. Is that correct?

[English]

Mr. Treacy: You would have GM pollen in the honey. Do I understand that correctly? To allow that to occur, the bees released into the field to allow pollination for seed production would have to be close to a beekeeper using bees for honey production. Honeybees do not enter the field or play a role in the pollination of alfalfa so there would have to be two parallel systems. The question is: Could leafcutter bees be used to develop honey? I do not know the answer to that. To my knowledge, they are specific to pollination.

Mr. McGuire: They use them for pollination, not honey production.

[Translation]

Senator Maltais: So they do not produce honey.

Mr. Treacy: Precisely.

Senator Maltais: So they are bees that do not produce honey?

Mr. Treacy: Precisely.

[English]

Mr. McGuire: Not commercially.

[Translation]

Senator Maltais: Do they have a name?

[English]

Mr. Treacy: Leafcutter.

The Chair: Thank you very much for the clarification. I was going to ask you to go back to what you said at the beginning, Mr. McGuire, about the leadership of your company and science-based principles to answer that question; but it is clear now.

Thank you, Mr. McGuire and your team, for sharing your vision and comments. We urge you to continue with all stakeholders in the agricultural field making Canada the best country in the world. Thank you.

Mr. Treacy: Mr. Chair, thank you for the opportunity. I wanted to note that I brought some brochures for information sharing purposes. I apologize that they are in English only. I am quite happy to leave the information with the clerk for distribution as you please.

The Chair: We will accept that. As we approach the writing of the report and its distribution to various levels of government and stakeholders, if you feel that you want to intervene or add information, please feel free to do so until the end of September.

I declare the meeting adjourned.

(The committee adjourned.)