Proceedings of the Standing Senate Committee on
Agriculture and Forestry
Issue 22 - Evidence - Meeting of December 2, 2014
OTTAWA, Tuesday, December 2, 2014
The Standing Senate Committee on Agriculture and Forestry met this day at
5:05 p.m. to study international market access priorities for the Canadian
agricultural and agri-food sector.
Senator Percy Mockler (Chair) in the chair.
The Chair: I welcome you, honourable senators and the witness to this
meeting of the Standing Senate Committee on Agriculture and Forestry. My name is
Percy Mockler, a senator from New Brunswick and chair of the committee. At this
time, I would like to start by asking the senators to introduce themselves.
Senator Merchant: Hello again, my neighbour from Manitoba, I'm Pana
Merchant from Saskatchewan.
Senator Dagenais: Good evening. I am Jean-Guy Dagenais, a senator from
Senator Enverga: Tobias Enverga, Ontario.
Senator Oh: Victor Oh, Ontario.
Senator Rivard: Good evening. I am Michel Rivard, a senator from
Senator Unger: Betty Unger from Alberta.
Senator Lang: Dan Lang, Yukon.
Senator Ogilvie: Kelvin Ogilvie, Nova Scotia.
The Chair: Thank you. To the witness, thank you very much for
accepting our invitation to come here this evening and share your opinions, your
recommendation and your vision of the mandate that we have received from the
Senate of Canada.
The committee is continuing its study on international market access
priorities for the Canadian agricultural and agri-food sector.
Canada's agriculture and agri-food sector is an important part of the
country's economy. In 2012, the sector accounted for one in eight jobs in Canada
— employing over 2.1 million people.
And also close to 6.7 per cent of Canada's gross domestic product.
Internationally, the Canadian agriculture and agri-food sector was
responsible for 3.6 per cent of global exports of agri-food products in 2012.
Also in 2012, Canada was the fifth-largest exporter of agri-food products
We have the honour to have at our committee this evening a witness from Pulse
Canada, Mr. Gord Kurbis, Director, Market Access and Trade Policy. Mr. Kurbis,
we will ask you to make your presentation. It will be followed by questions from
the senators and on this, again, the floor is yours. Thank you very much.
Gord Kurbis, Director, Market Access and Trade Policy, Pulse Canada:
Thank you very much, honourable senators. Thank you for inviting Pulse Canada to
present to you today.
The chairman of our Pulse Canada board, Nick Sekulic, sends his regrets. He
and I were originally supposed to appear together, but he had important business
to attend to at his farm in Rycroft, Alberta.
As many of you will be aware, Pulse Canada is a national industry
association, and it is funded by farmers from across Canada who grow lentils,
peas, beans and chickpeas. A farmer levy is collected by provincial pulse
organizations and combined with funding from the processors and exporters of
pulse crops. Farmers and the trade work together under the auspices of Pulse
Canada. We have always been a strong supporter of the pursuit of bilateral and
multilateral trade. Being on an equal footing with other exporting nations has
allowed Canada to become the largest exporter of pulses in the world. We
regularly trade with nearly 160 countries around the world.
Pulse Canada has also been an advocate of trade-enabling policy and
regulatory processes in Canada and at the international level. I would like to
use my time to address one of these specific policy challenges.
Crop protection products, like fungicides and herbicides, protect crops from
weeds and diseases that reduce yields. These yield-enabling technologies are the
key to growing enough food for the entire world on the existing land base. So
they are part of the sustainable intensification of food production.
Crop protection products are available to farmers only after they have been
thoroughly evaluated from a human health and environmental safety perspective.
Each crop protection product is assigned a maximum residue limit or MRL. By
definition, an MRL is the maximum amount of residue that can be detected on the
crop that is harvested and is an indicator of proper use of the product.
Importantly to consumers, the MRL is also an indicator that shows that the food
product is well below the level of concern for health or environmental safety.
It's a science-based risk assessment system that's as important to farmers as it
is to the pharmaceutical and the health care systems. Efficacy and safety are
the cornerstones of building public trust in food systems, as they are in the
Farmers in the Canadian trade have to be aware of both the MRLs established
by regulators in Canada and the MRLs that are in place around the world, and
specifically in the export destination for the Canadian crop in question. It's
both the process to establish the MRL and the timing of the establishment of the
MRL that are of great importance.
In the global food system, a strong argument can be made for an effective
global standard setting body. The Codex Alimentarius Commission was established
by the World Health Organization and the Food and Agriculture Organization —
both agencies of the U.N. — to develop food safety standards. Codex is
responsible for establishing MRLs for food products.
The challenge that farmers and the Canadian trade face is that neither the
process nor the timing of MRL establishment is synchronized between regulators,
like Codex at the international level, national or regional groups, like Health
Canada's Pest Management Regulatory Agency, the EPA in the United States, or the
European Food Safety Authority. In fact, rather than seeing a strengthening of
alignment at the international level, we're seeing more national approaches to
food safety with some countries moving away from Codex to establish their own
The problem is that from a trade perspective, and this is one that we have
lived through directly in Pulse, is that a product can be tested and registered
for use in growing a crop in the exporting country before it has been deemed
acceptable by the regulatory body in the importing country. This puts trade at
risk. And it's not a food safety issue; it's a risk produced solely by a
I would like to suggest two positions for your committee to consider. These
considerations raise important questions about Canada's food policy, Canada's
position on Codex reform, and the position that Canada would need to take in
bilateral and multilateral trade negotiations.
First, we favour a global approach to food safety standards and recognize
that many countries, like Canada, will feel the need to establish their own
separate national approaches. I also suggest that we need to have a process to
allow for mutual recognition of standards established by other competent
authorities. This will only be acceptable to the public if there is an
acknowledgement that science-based risk assessment of another competent
authority, such as the World Health Organization through Codex Alimentarius,
provides adequate protection to the health of Canadians.
Health Canada's PMRA has already gone part of the way by making progress
towards full harmonization of science-based approaches within the OECD global
joint reviews. This involves the sharing of processes and some standardization
of approaches in registering products for use. We need to continue to work
towards harmonized approaches at the registration level, and Canada needs to
push for reform of codex processes to achieve alignment in process and timing of
Codex MRL establishment with the OECD approach.
The key question that we need to address during our trade discussions is
whether nations will accept competent science-based approaches of other nations
or bodies like Codex when establishing import tolerances. It would certainly be
in the interest of Canadian farmers to have an importing country accept as an
import tolerance the MRL established by the PMRA in registering a product for
use, or to propose to a party that we are negotiating with to accept the
standard established by another competent authority, like the EPA in the U.S.A.,
EFSA in Europe, or Codex at the international level.
This mutual recognition is an effective way of avoiding the regulatory gap in
the establishment of a standard. In fact, it's already being used in several
cases around the world within the UN's World Food Programme and in countries
ranging from Costa Rica to Egypt to Panama.
The second issue is that if we are to ask other countries to accept the
approach of mutual recognition, we can expect to be asked the question: How
would Canada respond to a similar request? Would Canada be willing to move to a
mutual recognition when an MRL had not been established by Canadian regulatory
authorities but where the work has been done by EPA or the World Health
Organization through Codex? The challenge is clear: Adoption of new technology
is key to the sustainable intensification of food production. Canada is a
trading nation and needs to export and regulatory gaps put trade at risk.
We look forward to your report and to how the Senate would suggest we deal
with these issues.
The Chair: The first question will go to Senator Merchant to be
followed by Senator Dagenais.
Senator Merchant: What other countries around the world are our trade
competitors in Pulse products?
Mr. Kurbis: We have a wide range of competitors, with the United
States and Australia being the two principal competitors. The trade is complex,
as well. For example, China is our largest importer of feed peas, but they are
also one of our largest competitors in the export of dry, edible beans around
the world. Europe is a big destination for beans, but Europe is also a
competitor in the pea trade.
On our largest bulk commodity, which is yellow peas, we are seeing increasing
competition from the former Soviet union with Russia, Kazakhstan and Ukraine.
Senator Merchant: Because of the concerns you have with science-based
evidence and regulations, do those countries have similar problems? Have they
overcome some of them by some means? Are there other countries we can look to
see how they are resolving these difficulties?
Mr. Kurbis: Well, yes. The best practice being employed today on the
principle of mutual recognition is the global joint reviews conducted under the
umbrella of the OECD. These health and food safety regulators are from Canada,
the U.S., Australia and Europe and, increasingly, we're seeing countries like
China and Japan.
This is a very promising example that we need to build on where teams get
together in the same room and review the same data. Usually they then harmonize
their tolerances and importantly the timing of when those tolerances are issued.
It's not as complete as it needs to be just yet.
Senator Merchant: My next question is about our transportation system.
You have been having some difficulty with exporting products because you've got
to do it in a timely manner. Do you have some suggestions for the difficulties
we experienced with grain transportation in the past year? What are your
suggestions about resolving some of these difficulties?
Mr. Kurbis: Pulse Canada is part of a multi-commodity transportation
project that has several components, one of which is the gathering of a data
package that can document with more granularity and proof than ever before the
specific challenges that rail service poses to exporters. We will be making
recommendations on the basis of what that data show. It's still in the
collection process. Pulse Canada, through that multi-commodity project, is also
in the process of putting a submission to the CTA review.
We have a dedicated lead on that transportation area. It is not I, and I am
not sure that I want to speak for the project.
Senator Dagenais: Thank you, Mr. Kurbis, for your presentation.
I would like to come back to your exports, and correct me if I am wrong, but
I was told that 65 per cent of your pulse exports were marked out for five main
markets: India, Turkey, China, Bangladesh and the United Arab Emirates.
Is the regulatory environment of those countries stable and predictable
enough to ensure the growth of your exports? If so, why do you think your
exports to those countries may increase?
Mr. Kurbis: That's a good question. Let me answer by suggesting that
there are currently two categories of predictable market access, or relatively
more predictable market access that we trade into. One is represented by
countries like Japan. While it is not problem-free, by and large the processes,
the regulations and the manner in which the regulations will be enforced are
clear. There might be instances where we don't like the rules, but we do have
the predictability, which is key in trade.
Other countries around the world have very poor regulatory capacity indeed.
Those countries also tend to be not without problems, but again, relatively
It's in countries that are currently transitioning from developing countries
to rich countries, that are moving through a process, where — and there are some
on the list of the five that you named — they are saying, "Now that we've got
some money, we can afford to have our own building that would be similar to
Health Canada's Pest Management Regulatory Agency, so we're going to come up
with our own sets of food safety tolerances for our own population rather than
continuing to use Codex.''
This is a disturbing trend, and, on the list of countries that you have
provided, China has recently moved away from Codex to its own national list. As
they are doing so, we don't have predictability going into China, and you know
what kind of market China is, not only for pulses but also for many Canadian
commodities. In some cases, we don't know what legal tolerances are in place
that we need to be compliant with.
The UAE is now going towards its own national list of food safety standards.
They are going to be coming up with 20,000 individual MRLs. Fortunately, in the
case of the UAE, most of those are already harmonized with the EU.
India currently continues to defer to Codex, but it does have some national
MRLs in place for specific products. We don't know whether they could be in a
position to say, "We no longer use Codex; we'll use our own MRLs,'' but some in
the trade speculate that they too will be moving in that direction.
So in terms of stability we see a trend developing toward less, rather than
more, harmonization around the world, and that, to us, is very disturbing, hence
our observation that some method of employing the principle of mutual
recognition is becoming increasingly imperative.
Senator Enverga: Thank you for the presentation. We actually completed
our study about bees. When you say here that you are having some issues with
regard to herbicides to protect the crops and low level presence, where they say
it's a low-level presence, what type of herbicides are you using? Are you still
using the neonicotinoids or is it a different kind of pesticides that you are
Mr. Kurbis: In pulse crops, there is not a large use of insecticides
generally. Let's say we get a late season grasshopper outbreak, which we haven't
had for close to two decades, insecticide use is not that widespread. It's
mostly herbicides and fungicides. If you don't mind, let me take a step back and
observe that default levels in most countries around the world today that have
defined default policies say, "If we don't have a tolerance in place, what do we
use as a catch-all?'' are at 10 parts per billion, 0.01 PBM. That's been in
place for many years. Canada's is 100 parts per billion. At those levels, the
vast tests that come back are what we in the industry call "non-detects.'' There
is no detection of any residue whatsoever. By global standards, our crops are as
clean as they come.
So what we worry about is not the level of residues that are on our crops at
10 parts per billion. We worry about a future where that testing technology will
go down to 1 part per billion and then 500 parts per trillion and then maybe
even more sensitive. It's at that point in the future where, if we continue to
have zero tolerance in place, where we have these regulatory gaps where we
haven't yet completed the approval process in the importing country, it will be
that testing technology that could be very problematic. Is it problematic today
at 10 parts per billion? No, so there's an opportunity to get in front of this
problem. And I think that you would hear from people who contend with the
adventitious presence of unapproved GM events that they would very likely tell
you the same thing.
Senator Enverga: So you're more worried about the future, the future
of technology that can detect it? There's no real issue at that point, then?
Mr. Kurbis: The answer is a bit greyer, as you might expect. The
defaults in place around the world today are set at 10 parts per billion. That
is ostensibly set at the limit of detection, but, in the past few years, we are
now aware of limits of detection that are in the single parts per billion. We
did some residue tests last year and the detection level was 500 parts per
trillion. So we're already there. Are those specific methods the ones that trade
is being subjected to today? We wish we had better data on that.
Senator Enverga: But are the same herbicides being used on these
Mr. Kurbis: Yes.
Senator Enverga: Is there any particular herbicide that they are
Mr. Kurbis: It's not any particular class of herbicide. As you know,
there are some pesticides that are being subjected to concerns around
environmental and bee health issues. These are not the insecticides, by and
large, that are at issue for us. Typically fungicides would be registered across
a wide range of crops, pulse crops, cereal crops, oilseeds. Herbicides can be a
bit different, depending on whether they are broadly persistent, but, typically,
we apply products very early in the season. At today's 10 parts per billion,
there are no detectable residues.
Senator Enverga: May I ask one more?
The Chair: Yes.
Senator Enverga: Assuming that, right now, you're using the herbicides
and pesticides, what happens if you don't use them? Just like the other
countries, right? How much yield are you going to lose? Is there any percentage?
Mr. Kurbis: It would be good to see some presentation of data like
that because I think that would help make the case, but, anecdotally, farmers
would tell you that they could face very heavy losses indeed if there was an
outbreak of disease that couldn't be controlled or if there was severe insect
damage that couldn't be controlled. There's also weed pressure that could
gradually overtake fields and present some very serious problems.
I don't have good numbers on percentage losses to share with you at this
Senator Oh: Thank you, witness.
Pulse Canada recommends taking proactive measures to reduce international
trade barriers. Can you describe the proactive measures you have been taking?
Mr. Kurbis: Can you expand on the question slightly, please?
Senator Oh: Yes, I'm talking about you having been doing proactive
measures to increase your trade more internationally, open up your market. You
recommend being more proactive. How do you encounter that approach?
Mr. Kurbis: We have been doing international market development in the
pulse industry for several decades, and it has been varying to the extent of
focus in our organization. Initially, 20 years ago, when we didn't grow much for
pulses in Canada, we did a great deal of market development indeed in order to
convey the quality advantages and the availability and reliability of supply
from Canada. Over time, most buyers around the world have become well aware of
the availability and the quality of Canadian pulses, now that we've gone from a
very small player to the world's largest exporter. So that would be one manner.
In another, the UN has designated 2016 as the International Year of the
Pulse. We have five thematic areas set up under that committee where we would
like to expand the interest in utilization of pulses. We're focusing on food
security, health and nutrition, sustainability and market access, et cetera.
In one of those committees on market access we are currently reaching out to
Codex, through FAO, to try to provide evidence and be able to document that
delays at Codex are working directly at cross-purposes with their larger food
security objectives. So these are a few examples of the work we do as an
Senator Oh: What do you foresee? What is the growth every five years
on this? Any idea?
Mr. Kurbis: I think that on market access, we do worry that these
problems are going to get worse before they get better. As I described these
harmonization challenges, which are very difficult challenges, we have two
effects. One is the more sensitive testing technology that could cause the
existing extent of un-harmonized tolerances to become problematic. But perhaps
the most difficult trend is the number of countries that are now coming up with
their own custom approaches. In the last few years, South Korea, Hong Kong,
Taiwan, China, United Arab Emirates and, most recently, Mexico, are going away
from their old systems towards their new lists. These will be done, by and
large, by health regulators, who don't have a mandate for trade. It makes us
very nervous to see these developments and it's a concern.
Senator Oh: Does it mean every country will be setting up its own
Mr. Kurbis: That would be a nightmare if that happens.
Senator Unger: My question is almost a supplementary. You recommend
that Canada push for reform of Codex. I'm wondering why, when other countries
are moving away from it. I'm not sure what reforms you're talking about, but
would reform of Codex perhaps stop other countries from moving away from it?
Mr. Kurbis: That's exactly it. That's a very debated issue within crop
protection circles, because Codex has so many delays now. I think that the
extent of those delays and MRL gaps — so tolerances that they should have, that
they don't yet have because their waiting list is so long — that is a driver, to
some extent, why countries are moving away from Codex.
But on the other hand I think we all now have a better picture of what the
trading environment could look like if we see double or triple the number of
countries move away from Codex, as the short list that I shared with you has.
The vision of that potential convinces us even more of the need for a global
regulatory body for these types of tolerances or, failing that, some form of
mutual recognition so we have the equivalent established.
Senator Unger: Another question: Are there problems that ensue when
some of the countries to whom we export some of our products are also our
competitors? Does that bring up a new set of problems? China, for example.
Mr. Kurbis: Can you help me understand the question? I'm sorry.
Senator Unger: We export certain products to China, which is also an
exporting nation of other products. I'm just wondering if that creates a new and
different set of problems. Some of them are our competitors.
Mr. Kurbis: I don't think those create material or new problems. In
the case of China, the peas we send them they need and we need to export to
them. We reached almost a million tonnes in 2013. But on the beans, those are
two distinct markets in our trade, although for other commodities perhaps that
could be an issue, as you described.
Senator Unger: So basically a reformed Codex system would go a long
way or has the potential to go a long way to solving this global trading
Mr. Kurbis: Yes, that's right. I think I understand the question
better. If I may, the imperative to move in the direction of harmonized
standards is as important to importing countries, arguably, as it is to
exporting countries. So it's not just five or six countries around the world
that are exporters that would be pushing for this agenda. It could also be
China, which is a big importer, but they would also need the same approach for
its exports. I can tell you that India, which is our largest pulse buyer by far,
has had these very issues harm its basmati rice export market to the European
Union. As trade becomes more complex, all countries around the world that both
import and export, I think there could be a chance to build the momentum for
this type of approach.
The Chair: On the second round, being that it is your birthday,
Senator Enverga, we will ask you to continue on the second round.
Senator Enverga: Thank you.
My second question is: As we do our free trade with other countries, how much
capacity do we have? Do we have a supply management issue in the future? How do
you see the future with this free trade that's ongoing right now?
Mr. Kurbis: It would be great if we achieved three things from free
trade agreements. One would be the removal of any remaining tariffs that we face
going into key markets, whether we're trading into those markets now or whether
we've yet to start our trade.
The second would be to make sure that there is no other country that has just
finished its own negotiation, so our trade will now become curtailed as they
begin to enjoy a tariff advantage that we have not yet achieved because we don't
have a free trade agreement with that country.
The third benefit would be to see free trade agreements establish what I
would call 21st century trade rules, so we can move away from the type of zero
or near-zero tolerances that we have on the books around the world in many
cases, that the testing technology could make it very problematic for us. I
think if we had these three things, we have a very bright future.
Senator Enverga: And we have the capacity to produce more?
Mr. Kurbis: Tremendous capacity.
Senator Enverga: If you have the problem with regard to those things
you've mentioned, how are other countries coping with this? Are they having the
same problems, the same issues, when they try to export their pulses?
Mr. Kurbis: I think that Canada is among the leaders globally in
contending with these kinds of problems, because so many other producing regions
around the world are way less dependent on trade. We have 35 million people and
the amount of farmland that we do, and we would be in a position to export 80 to
90 per cent of what we grow. Brazil, for example, is one of the largest dry bean
producers in the world, but they export and import very little, so they're
almost 100 per cent self-sufficient. These issues will be important to them, but
I think Canadian exporters are first because of their dependency on trade.
Although we would have other grower groups around the world who are smaller
but in similar positions — the California specialty crops industry, so tree nuts
and this kind of thing comes to mind — we work closely with them in identifying
harmonization issues of mutual concern.
The Chair: As we close, Mr. Kurbis, we're curious to know whether your
industry is affected by the Country of Origin Labeling, COOL, policy of the U.S.
Do you have any comment on this subject?
Mr. Kurbis: We are not affected by COOL, although we have sympathy for
our fellow groups that are, because it seems to be a difficult issue indeed.
The Chair: In 2011, Canada exported a record 4.7 million tonnes of
pulses worth nearly $2.7 billion. We have provincial regulations. What are the
roles and responsibilities of the provinces? Do they create trade barriers that
affect your industry?
Mr. Kurbis: I can't think of one. I would say there are no material
trade barrier problems created by provincial policy.
The Chair: Mr. Kurbis, thank you very much for sharing your opinions
and recommendations with us. There's no doubt the industry is listening and
watching what we do with the order of reference that we have received from the
Senate of Canada. Please feel free to contact the clerk if you want to share
additional information with us.
Do you have additional comments?
Mr. Kurbis: I congratulate the committee for taking a look at this
very important issue. As a grower and trade group, we look at what we need to
advance our contribution to the Canadian economy in the future and market access
is a big priority for us. Congratulations for taking a serious look at this
issue, as you appear to be.
The Chair: It is a known fact that years ago we had five trade
agreements. Today, Canada is looking at 42 trade agreements that either we are
signing or are in consultation with other countries for.
On this, honourable senators, I declare the meeting adjourned.
(The committee adjourned.)