Proceedings of the Standing Senate Committee on
Agriculture and Forestry
Issue 23 - Evidence - Meeting of January 29, 2015
OTTAWA, Thursday, January 29, 2015
The Standing Senate Committee on Agriculture and Forestry met this day at
8:04 a.m. to continue its study on Bill C-18, An Act to amend certain Acts
relating to agriculture and agri-food.
Senator Percy Mockler (Chair) in the chair.
The Chair: I welcome you to this meeting of the Standing Senate
Committee on Agriculture and Forestry.
My name is Percy Mockler. I am a senator from New Brunswick and chair of the
committee. At this time, I would like to ask all senators to introduce
themselves, starting on my left, please.
Senator Dagenais: Senator Jean-Guy Dagenais from Quebec.
Senator Moore: Good morning. Wilfred Moore from Nova Scotia.
Senator Tardif: Good morning. Claudette Tardif from Alberta.
Senator Plett: I'm Don Plett, and I'm from Manitoba.
Senator Rivard: Michel Rivard from the province of Quebec.
Senator Oh: Good morning. Senator Oh, Ontario.
Senator Enverga: Tobias Enverga a senator from Ontario.
Senator Unger: Betty Unger, Alberta.
Senator Ogilvie: Kelvin Ogilvie, Nova Scotia.
The Chair: Thank you, senators.
Witnesses, thank you for accepting our invitation to share with the committee
your comments and opinions as we continue our study of Bill C-18, An Act to
amend certain Acts relating to agriculture and agri-food. This bill is designed
to modernize and strengthen federal agriculture legislation, support innovation
in the Canadian agriculture industry and enhance global market opportunities.
For our first panel today, we welcome Ms. Patty Townsend, Chief Executive
Officer of the Canadian Seed Trade Association, and from CropLife Canada, Mr.
Dennis Prouse, Vice President, Government Affairs. From Winnipeg, by video
conference, from the Canadian Federation of Agriculture, we have Mr. Humphrey
Banack, Vice-President. Thank you for accepting our invitation.
I would now invite the witnesses to make their presentations. I would remind
them that, as per the instructions from the clerk that they were given
previously, presentations should not exceed more than five minutes in length.
Following your presentation, questions will be directed to each of you from the
I have been informed by the clerk that the first presenter will be Mr.
Banack, to be followed by Ms. Townsend and Mr. Prouse.
Mr. Banack, you have the floor.
Humphrey Banack, Vice-President, Canadian Federation of Agriculture:
Good morning, and thank you, Mr. Chairman and members of the committee.
I am pleased to be here on behalf of the Canadian Federation of Agriculture
to speak with you today about Bill C-18, the proposed "Agricultural Growth Act."
My name is Humphrey Banack. I am a grains and oilseeds producer from central
Alberta and Vice-President of the Canadian Federation of Agriculture.
Through its member organizations, the CFA represents more than 200,000 farm
families across Canada and promotes the interests of Canadian agriculture and
agri-food producers to ensure the continued development of a viable and vibrant
agriculture and agri-food industry in Canada. We believe that Bill C-18 will
contribute to a more vibrant agriculture industry in Canada by modernizing a
number of pieces of agricultural legislation. We will identify a few key points
we believe should be addressed. Due to time constraints, I will focus my
comments primarily on changes to the plant breeders' rights and the Advance
Payments Program, but I am open to questions on any part of the bill.
Despite signing on to UPOV 1991, Canada has remained one of the few developed
countries in the world not to ratify it through legislation. This has limited
investment in Canadian varietal development and prevented Canadian producers
across a wide range of sectors from accessing the most up-to-date and innovative
products. The issue boils down to making sure Canadian farmers are competitive
and we aren't falling behind other countries.
We believe the legislation strikes a good balance between giving plant
breeders the ability to receive a return on their investments for their R&D,
while preserving the ability for farmers to save, store and condition seed for
their own use.
Although a number of concerns have been raised as to the effects UPOV 91 will
have on the diversity of plant breeders in Canada, international evidence
suggests that the implementation of UPOV 91 will result in an increase in the
diversity of Canadian breeders.
I would also like to point to the fact that 45 per cent of all agricultural
varieties currently protected under the PBR were developed at public
institutions. I must note our continued concerns with the recent shift away from
public funding for basic development, as it may very well reduce the presence of
new, publicly funded varieties and reduce competition from public entities.
However, plant breeders' rights provide a platform for exciting new
developments between producers and public institutions. In fact, with draft UPOV
legislation now progressing through the house, we've already heard of a new
research centre and partnerships between Canadian companies and international
breeders, and we continue to hear of groups exploring producer-led breeding
initiatives in Canada. However, we believe increased funding for producer-public
partnerships in this vein is needed in the future.
We see updated plant breeders' rights as a necessary step for the long-term
competitiveness of Canadian agriculture. I would like to comment on two specific
components of the changes to the Plant Breeders' Rights Act: end-point royalties
and farmers' privilege.
As already stated, Bill C-18 does not actually introduce end-point royalties
into Canada. Instead, it creates a legislative framework from which EPR models
can be developed through regulations. Our primary concern is that producers must
have a significant role in future regulatory processes through robust
consultation to ensure that any such royalties are reasonable and supported by
Similarly, we do not believe that the term "farmers' privilege" is
problematic, as long as the legislative text behind it provides the necessary
protections. In this vein, we were pleased to see the minister and standing
committee recommend an amendment that would clarify the privilege to include
farmers storing seed for future propagation.
With the wide range of products affected by this legislation, we recognize
the need for regulatory authority to amend the privilege where there is industry
consensus that it is desirable. This is an important point that we would like to
see more directly addressed.
Any regulations amending the farmers' privilege or developing end-point
royalties will require considerable consultation, and we believe this process
should require consultation with the Plant Breeders' Rights Advisory Committee
identified in the legislation. This advisory committee has mandatory producer
representation, and we believe consultation will ensure industry support for any
I would like to shift my comments now to the changes to the Advance Payments
Program. Canadian Federation of Agriculture members were pleased to see the
changes in Bill C-18, as they reduce the red tape associated with getting an
advance, broaden the access to the program for new products and new forms of
security, and provide producers with greater flexibility to market their
The ability to repay advances without proof of sale is an important amendment
that will allow producers to market their products when it meets their needs
rather than those of the program. We were pleased to see the government recently
extend a stay of default to producers affected by the transportation
difficulties of 2013-14. These changes will provide much-needed flexibility
around repayment deadlines for those unable or unwilling to move their product
in the future.
Similarly, multi-year agreements will reduce a lot of unnecessary paperwork
for producers and administrators that had to fill out the same form year after
year. Coupled with the amendments allowing single administrators to offer
advances on multiple commodities, this will streamline access for producers.
While producers will benefit from these amendments, we believe any
administrator expansion into new regions should require the approval of affected
producers via their producer groups.
One of the benefits provided by smaller administrators in many regions is
that they operate as service providers with an in-depth knowledge of local
regulations and the dynamics of the sectors that they are advancing to. We must
ensure that streamlining the program doesn't result in reduced participation.
Regulations should require administrators to consult with producers before
any such expansion and impose guidelines to ensure that these administrators are
familiar with the relevant regulations in a particular province, such as the
collective marketing regulations in Quebec, which can have a number of
implications for program delivery.
Although we appreciate the wide range of improvements this bill makes to the
Advance Payments Program, our members are disappointed to see that the maximum
advance limits were not updated. The limits were last increased in 2006, but
since that time the cost of farm inputs has risen dramatically and farms selling
$800,000 or more are increasingly common, such as the one I run at home. For
example, my fertilizer, rail freight, land costs and crop protections all now
individually exceed $100,000; and my annual operating costs are closer to
$800,000 or $900,000 per year. Although a relatively small percentage of all
farmers, these farms represent a significant amount of Canadian production.
For producers already receiving advances near $400,000, transportation
challenges and banks' reluctance to increase farm debt illustrate the benefit of
an increase to the limit come seeding time. An increase to the interest-free and
interest-bearing limits that recognizes the increase in farm input prices is
needed to ensure the program maintains its utility moving forward.
On behalf of the Canadian Federation of Agriculture, thank you for the
opportunity to meet with you today. I will be pleased to answer any questions
following the other presentations.
The Chair: Thank you. We will proceed with Ms. Patty Townsend.
Patty Townsend, Chief Executive Officer, Canadian Seed Trade Association:
Thank you, Mr. Chairman and honourable senators. I think we are going to hear a
little repetition today. I note that both the Canadian Federation of Agriculture
and the Canadian Seed Trade Association are members of a group called Partners
in Innovation, which I know you'll be hearing from next week. We are among the
20 organizations that have formed this informal coalition to support the
proposed amendments to the Plant Breeders' Rights Act. I'm happy to be here to
bring the perspective of the Canadian Seed Trade Association on Bill C-18. We
have provided a detailed submission in both official languages, so I'm just
going to touch on a couple of highlights.
The Canadian Seed Trade Association brings together 130 member companies that
are involved in all aspects of seed: plant breeding, trait and variety
development, production, processing, packaging, marketing, sales and trade. Our
members work with 50 different crop kinds and range from small single-grower
retailers to multinational companies, and from distributors and packagers of
organic vegetable and herb seeds to the giants of biotechnology. Our members
have very diverse interests, but they have all come together in support of our
mission, which is to foster seed industry innovation and trade.
In 2012, CSTA's private sector company members invested just under $110
million in plant breeding research and variety development in Canada. That's
more than 6 per cent of their combined domestic sales and a 90 per cent increase
from that investment level in 2007. Our members have signaled their intent to
continue to increase investment in areas where they have traditionally invested
— corn, canola and soybeans — where intellectual property protection tools are a
lot stronger, but also in crops like cereals, where the private sector
investment level has been traditionally quite low. This is a direct result of
optimism, and that optimism was created in part by the introduction of Bill
The proposed amendments in the bill to the Seeds Act and to the Feeds and
Fertilizers Act would allow for the use of foreign data in approval systems that
could result in more timely approvals of innovation for farmers and consumers,
while still protecting the health and safety of humans, livestock and the
environment. Seed is a highly regulated commodity. Our sector is directly
impacted by over 12 pieces of legislation and their associated regulations.
We welcome the proposal in Bill C-18 for incorporation by reference. That
would allow some things, for example the list of crop kinds subject to variety
registration, to be moved out of legislation and be referred to in regulation.
That would help to make the industry more efficient because we would be able to
deliver varieties in a more efficient manner, but it wouldn't preclude the
requirement to provide the rationale in the industry consensus for that kind of
change. It could also prevent some disconnects between the existing regulations:
for example, the Weed Seeds Order in Canada's regulated pest list, where
potentially invasive species are currently regulated by one and not the other.
While many of the elements of Bill C-18 can benefit the seed sector, the one
that we need most and for which we have worked the longest is the section that
will amend Canada's plant breeders' rights legislation. This part of Bill C-18
is already having a positive impact. Bringing our legislation into compliance
with the most recent convention of the International Union for the Protection of
New Plant Varieties will give plant breeders and variety developers the
confidence to invest in Canada. When Bayer CropScience Canada, one of our
members, turned sod on its new cereal breeding facility in Saskatchewan,
representatives at the sod-turning made it clear that this would not have
happened without the promise of Bill C-18.
It will also give international plant breeders the confidence to send their
new, superior varieties to Canada. Just over a year ago, we received letters
from the European Seed Association making it clear that they would not send
their varieties to Canada because they couldn't protect them in the same way
that they can be protected in other countries. After Bill C-18 was announced, a
number of our member companies announced significant agreements with
European-based plant breeding companies to bring new varieties to Canada.
I've been talking in the last little while to a lot of farmers and farm
groups on this issue. I'd like to end my time with you by addressing two of the
misconceptions that still seem to be out there about the amendments.
First, as Mr. Banack said, these proposed amendments will not take away the
ability of farmers to save grain they produce on their farms, clean it, store it
and use it as seed on their farms. Whatever you call it, the farmers' exception
to the plant breeder's right is entrenched in this proposed legislation and
would require a legislative amendment to change.
Second, as Mr. Banack said, the implementation of this legislation will not
immediately give plant breeders the ability to collect royalties on delivered
grain, a so-called "end-point royalty." Just like now, breeders are only able to
collect their royalties on the propagating material, the seed. Under the
harvested material provisions of the bill, if the breeder can prove in civil law
that the seed was acquired illegally, a breach of the plant breeder's right,
then the breeder could seek compensation through civil law on the harvested
material, but the compensation could include much more than the royalty.
I look forward to any questions.
The Chair: We will move on to Mr. Dennis Prouse.
Dennis Prouse, Vice President, Government Affairs, CropLife Canada:
Thank you for inviting me here today. It's my pleasure to offer some remarks
with regard to Bill C-18, the proposed "Agricultural Growth Act" on behalf of
our members and to answer questions honourable senators may have.
CropLife Canada is the trade association representing manufacturers,
developers and distributors of plant sciences technologies, including pest
control products and plant biotechnology for use in agriculture, urban and
public health settings. We strive to ensure that the benefits of plant science
innovation can be enjoyed by both farmers and consumers. We promote sustainable
agricultural practices, and we're committed to protecting human health and the
We also work very closely with a number of stakeholder groups, two of whom
you just heard from. We're very proud of the fact that all of Canada's major
farmer-based grower groups are members of our GrowCanada partnership.
Like your previous two speakers, we're strongly supportive of Bill C-18. We
hope that the Senate will pass it promptly. We're particularly pleased about the
potential to amend the current Plant Breeders' Rights Act, a key plank of the
bill. We're also very encouraged by the portions of the bill that relate to
providing the Canadian Food Inspection Agency with the authority to consider
foreign reviews, data and analysis during approval or registration of new
products in Canada. Both of these elements have, after all, been a long time
coming. Canada is still operating under the version of the Plant Breeders'
Rights Act that was passed in 1990. That act, however, only conforms to UPOV 78,
not the updates to the UPOV convention that took place in 1991. Further to Mr.
Banack's point, only New Zealand and Norway join us on the list of developed
countries that have not conformed to UPOV 91.
Our lack of conformity to UPOV 91, as Ms. Townsend pointed out, has had
consequences. It acts as a disincentive to bring to Canada plant varieties that
have been developed elsewhere. An associated issue is that it builds in an
incentive to invest outside Canada.
As we've pointed out in this committee before, agricultural innovation is
going to take place, and it is taking place globally right now. As technical
barriers continue to fall and as the cost of data continues to decline, that
pace of innovation will increase. The question then becomes: Will Canada provide
the environment that encourages this innovation to take place in our country?
Bill C-18 takes a long overdue step to correct this issue.
Encouraging the development of new varieties of plants is not just a
corporate issue. It has direct benefits for Canadian farmers who use innovation
to both increase yields and improve sustainability. Only a modern legislative
framework for intellectual property protection, one that brings us into
alignment with our global trading partners, can encourage the kind of investment
that leads to innovation.
As Ms. Townsend pointed out, the introduction of Bill C-18 even before it
became law already had a positive impact on the environment for investment and
innovation. I'll spare repeating the points that Patty made, but suffice to say
that we're highly supportive of that as well, and we're encouraged to see it.
When that doesn't take place, let's be clear as to the consequences. Those
benefits, such as increased yield or improved disease resistance, go to farmers
that are global competitors of ours. I think that is the key issue that needs to
It's also worth noting, Mr. Chair, that universities, government departments
and smaller independent breeders, of which there are an increasing number, also
benefit from compliance with UPOV 91. Almost half the Canadian plant breeders'
rights applications come from public institutions, and royalties continue to
accrue to them. There also is the issue of farmer-saved seed, as the previous
two speakers addressed. It's important to note that the current version of the
legislation actually doesn't address farmer-saved seed in any way. It's silent
on that issue. Bill C-18 explicitly addresses it, as you've heard previously.
Those are the plant breeders' rights issues. Obviously you've heard from a
number of important witnesses on this.
One of the less-discussed elements of Bill C-18 that we believe deserves
attention is the portion that provides CFIA with the authority to consider
foreign reviews, data and analysis during approval or registration of new
products in Canada.
A really key challenge moving forward for CFIA is their ability to streamline
and modernize the approvals process. We know that the number of approvals for
consideration by CFIA will continue to rise. This is good news. It clearly
demonstrates modernization and confidence in Canada.
The challenge will come in ensuring that approvals and registrations are
considered in a timely and predictable manner. Canada needs to work with other
nations that adhere to global standards on science-based regulation. There's
absolutely no need for Canada to collect a second set of data, perform yet
another review, and conduct yet another analysis when they have already been
performed by an agent whose standards meet ours. It is needless waste and
duplication that can and should be eliminated. By explicitly granting this
authority to CFIA, Canadian consumers will be far better served and Canada will
continues to become an attractive place to invest and do business due to a
predictable, timely, science-based regulatory system. You'll hear the phrase
"science-based" from us an awful lot. It's a common sense step forward that we
To conclude, Mr. Chair, as one of the leading agricultural producers and
exporters in the world, we believe it is critical that Canada modernize its
legislative framework to encourage investment and innovation. To do otherwise
would be a tremendous disservice to Canadian farmers, consumers and our economy
as a whole.
The potential for Canadian agriculture is immense. There's a growing world
population that is anxious for quality Canadian agriculture and agri-food
exports, and we have the land, the climate and the people to fill that need.
There has never been a better time to be part of agriculture in Canada. To
realize that potential, however, we have to constantly move forward and
modernize and keep pace with our global competitors. Bill C-18 is an important
step in that process.
Thank you, Mr. Chair.
The Chair: Thank you, Mr. Prouse.
The first question will go to Senator Tardif, to be followed by the sponsor
of the bill, Senator Plett.
Senator Tardif: Thank you for your presentations this morning.
From your presentations, it's clear that generally you support the bill, and
I would say probably very strongly, but you have not addressed any concerns that
you may have with the bill. I know that you represent a number of organizations.
Can you share with us some of the concerns that you have heard? I'm sure that
there are some concerns out there.
Ms. Townsend: I'll start because I think that my answer is pretty
We don't have any concerns with the bill. This government has been very good
at consulting and has included us all the way along in the development of the
things that were very important to us. We feel that we had a tremendous amount
of input on behalf of our members on the development of the wording around the
plant breeders' rights amendments and in the areas of accepting and considering
foreign data. For the parts of the bill that affect us, the seed sector, we only
Mr. Prouse: Further to Patty's point, the pace of positive change in
innovation in the last three years has been stronger than it was in decades
before that. There have been a tremendous number of steps forward. The only
concerns I hear from stakeholders are the weekly calls with a great deal of
concern that this isn't going to get passed on time. That's the only concern I
Senator Tardif: Mr. Banack?
Mr. Banack: We're very supportive of the plant breeders' rights
With regard to the Advance Payments Program portion of this bill, we used to
get cash advances previous to sales we have on our farms. The ability to access
cash and operating capital has always been a challenge, and the changes here are
very much appreciated and supported. We have to make sure that we meet those
needs and we continue to ask for a bigger advance amount. That would be our
biggest concern, that the cash advances should be expanded to a higher level to
meet the cash needs of my farm and the farms of all our members.
Senator Tardif: Mr. Banack, you expressed in your presentation the
fact that there's a concern about the reduced public funding, that there may be
a shift away from public funding of research, and this could reduce the
competition. Would you care to address and elaborate on that?
Mr. Banack: We have seen a reduction in public funding from the
mid-1990s until today. It has fallen dramatically, dollar for dollar, the
matched dollars today that we have available to us as public breeders. We
believe that the public breeding system has a lot of innovative and important
things to do to make innovative products that are specific to the Canadian
The ability to bring in international technologies is absolutely great. It
provides us with those tools, but there are things we have to do to make our
products different. For us to access international markets, we have to find
niche markets, and we operate in a different climate from a lot of the world.
It's important to have that expanded public breeding from where we are today to
make sure we at least don't drop any more than we absolutely have. We've seen
breeding centres and research centres across Canada closed over the last number
of years, and they continue to close, and we're very concerned with those
Senator Tardif: Is there any concern that the government, through
Governor-in-Council, can pass regulations that would amend the privileges that
are currently exempt in what's being proposed in the Plant Breeders' Rights Act?
Mr. Banack: Yes, I guess the orders-in-council are a challenge to us
because we believe that it has to be run by the industry, or at least to have
industry consultation, to make any changes. We believe that hopefully through
government lobbying and working with the government we can make sure the
orders-in-council reflect the needs of our producers.
Senator Tardif: I would ask you the same about incorporation by
reference. You know that by incorporation by reference, it's not necessarily
published in the Canada Gazette and that there would be no public
discussion in Parliament. Is that a concern to you?
Mr. Banack: Yes, any time things are done without consultation with
our members and without that full public scrutiny, it does become a concern to
us. But, as I said before, hopefully through the consultation process that has
been set up by the committee here on plant breeders' rights, I believe we can
have some input into it and we can be there. It is a concern, and we will be
watching closely as it moves forward.
Senator Tardif: Thank you.
The Chair: Ms. Townsend, you indicated you had some comments.
Ms. Townsend: I wanted to add a couple of comments on regulatory
changes and incorporation by reference.
There is a process that's very clearly spelled out for changes in regulation.
We've been through it a number of times, most recently on some changes to
variety registration, and we're still working on the Weed Seeds Order, which is
currently in regulation.
It took us three years to make changes to variety registration because of the
amount of consultation and consensus that needed to be proven before those
regulatory changes could be made, even without and before the gazette process.
The Weed Seeds Order and the invasive species act regulations that I talked
about in my presentation, right now they are not in sync. There are pests that
are regulated under the regulated pest list that are not included on the Weed
Seeds Order, which is what we operate under to ensure that we don't have noxious
weed seeds in our seed. They are out of sync right now because it's taken us
four years to effect those regulatory changes to the Weed Seeds Order to bring
it into compliance with the regulated pest lists.
Incorporation by reference just moves those out of regulation and removes
that gazette process, but it does not remove the process to demonstrate
rationale, to do an economic impact assessment and to demonstrate consensus
before a change is made.
Senator Plett: Thank you to all three witnesses.
Mr. Prouse, you said your biggest concern was that you hope this bill will be
passed on time. We will do our level best to make sure that concern will be put
aside as well.
Mr. Prouse: Thank you, senator.
Senator Plett: It is difficult to ask questions of three witnesses who
have been so positive about this legislation and don't have anything bad to say.
I appreciate that.
I want to read a short paragraph from a Canadian Seed Trade Association
background paper. It is really good reading.
Canada signed the convention in 1992, signalling its intention to ratify
the convention. Legislation was introduced in the House of Commons in 1997,
but it was not passed.
As a result, as we've heard today, Canada is one of only three developed
countries of UPOV whose legislation does not comply with the most recent
Understanding that there will always be things we can improve on, I don't
think it matters what kind of legislation we pass. If we don't pass legislation
until we get it all right, we will always remain behind and we will always be
one of the two or three developed countries who have not signed on.
Mr. Banack, I do want to touch a little more on the advance payment. In my
previous life I was a small businessman, not farming but working with farmers
all of my life. Cash on hand has always been an issue for farmers ever since I
can remember, and I don't think any amount of public funding is ever going to
entirely solve that.
I think most of us around the table may be aware of this, but there could be
people watching on television that aren't, so I would like you to explain to me
what the cash advance in this legislation has done to improve what you could
possibly do in your operation.
Mr. Banack: The cash advance is a very important part of our
operation. We're a low margin industry. The margins we get are much less than
many of the other industries in Canada that are part of the GDP. Part of that
comes down to the fact that we have cash flows and bills to pay for input costs
that are six or seven months old and are starting to draw interest, which we
have to get paid off quickly after harvest. The Cash Advance Program allows us
to draw from our advance in two stages, either a spring cash advance after the
crop is seeded off our crop insurance numbers or a post-harvest advance after
we're finished harvesting and the crop is in the bin. This allows us to access
capital, manage our accounts and take advantage of market signals.
In our instance, we always see market prices fall in the fall as farmers try
to move product into the system to pay bills, and supply demand drives those
prices down at that time. The advance is very important in that sector.
On the changes to the bill, each year I want a cash advance, I have to go to
my bank and my input supplier so they can sign off that they understand I'm
getting an advance. The changes to this bill will give me a five-year window
where we'll have a signed agreement. That will be good for five years so when I
take this cash advance, it will be an easier and a more simple process than
approaching my bank and input supplier. They sign off easily and it's not issue
with them because they realize the cash advance helps my cash flow as a business
and provides them security and payment. That is one of the biggest things I see
As I said before, for some of our operations, and mine in particular, the
$100,000 cash advance is much welcomed, but to be truthful, it should be
expanded to a larger number so that it better fits the needs of our operations.
My operation alone does pretty close to $1 million in sales over the year.
The $100,000 is an important part. My input costs run close to $600,000 or
$700,000. It takes a lot of commercial backing to put the money in place to grow
Senator Plett: Further to what Senator Tardif asked on whether you had
concerns about some things being changed by a Governor-in-Council order, if the
cash advances are too small, then possibly a Governor-in-Council order
increasing the cash advance down the road might be a positive thing.
Mr. Banack: Yes. The order-in-council is always an important part. As
Patty noted, the processes we have now can be very onerous and we don't want to
stay to that system. We would like to have a much more clean system, but we want
to make sure that the orders-in-council do reflect what producers need.
Senator Plett: Ms. Townsend or Mr. Prouse, in layman's terms, could
you touch a little more on farmers' privilege, what that does as far as plant
breeders' rights are concerned, that farmers aren't going to be penalized for
reseeding with seed that they had last year.
Ms. Townsend: I'll start out first. I kind of know it by heart.
First of all, as Dennis said, the current Plant Breeders' Rights Act doesn't
have anything in it about a farmer's privilege, right or exception. The UPOV
language actually calls it an exception to plant breeders' rights. It doesn't
say anything, so essentially you can do it because it doesn't say you can't.
This new bill entrenches it into the legislation in proposed section 5.2. It
spells out the breeders' right, which gives the breeder the authority. So they
have to grant authority to do a number of things, including producing,
reproducing, stocking, importing, exporting, making repeated use of sale and
advertising for sale, propagating material or seed. Proposed section 5.2 gives
an exception to farmers. It allows farmers an exception to most of the plant
breeders' rights, the producing, reproducing, stocking or storing and
conditioning of grain of protected varieties for use on their own farms. It
spells it out.
Incidentally, that language, "farmers' privilege," is actually in the margins
for reference and is not part of the legislation itself. It really doesn't have
an impact on the fact that it's actually entrenched in the legislation.
Mr. Prouse: Contrary to myth — and some of the opponents of Bill C-18
have tried to claim this is creating new precedence — all it is doing is
entrenching the right to save seed, confirming our original signature to UPOV
91. It is simply reinforcing what had already been agreed to. So there are no
new frontiers here in Bill C-18. To hear some NGOs talk, you would think there
is something terribly new here, but there isn't.
Ms. Townsend: The UPOV convention does not require the provision of a
farmer's exception. The UPOV convention makes it optional. Some countries in
Europe do not allow for farmers to save the grain from protected varieties to
use as seed on their own farms, but Canada has made that decision. That's a
practice our farmers need, and that's why it is now spelled out in the
Senator Plett: And typically many farmers would save about 10 per cent
of last year's crop for reseeding next year.
Ms. Townsend: It depends on the farmer and the crop. We're seeing more
and more farmers because, as Dennis said, the pace of technology has become so
much greater. Farmers want to access that new product, so they are buying new
seed every year.
Senator Moore: Thank you for being here. I'm new to this committee and
this topic, and I find the phrase "farmers' privilege" to be interesting. Could
you explain in lay terms what that means? I don't know what it means.
"Privilege" always makes me wonder what that includes.
Ms. Townsend: It's funny because when this legislation was being
developed, we had a lot of discussions about what you would call it. I know that
some organizations would rather have called it a farmer's "right," and there are
some organizations that like "privilege." From my perspective, you could call it
Bob and it wouldn't matter because that terminology is not part of the
legislation. It was just to put in a reference point so you could find that
piece of the legislation that explains the exception given to farmers to use the
product that they produce — protected varieties of seed — on their own farms.
Without being facetious — and maybe it sounded facetious — it doesn't matter
what you call it. The fact is that it's entrenched in legislation and it is an
exception to plant breeders' rights.
Senator Moore: So is somebody granting this privilege? Does a farmer
have to look to somebody to get approval?
Ms. Townsend: No. The legislation grants the privilege. That means
that if you produce a variety and protect it with plant breeders' rights. and I
buy seed of that variety, then I am perfectly within my —
Senator Moore: You're the farmer?
Ms. Townsend: I'm the farmer; you're the seed company. You've
developed a variety. You've made the investment to develop that variety and have
chosen to protect it by plant breeders' rights. "Chosen" is an important term
because you are not required to protect your varieties by plant breeders' rights
or by any other intellectual property protection tool. You protect that and I
buy it. I can actually grow grain from that seed, save that grain, clean it,
store it and use it as seed on my farm for years to come if I choose to do so.
You don't have to apply to anyone. It's there in the legislation, which means
that you as a breeder can't come back to me and tell me that I'm doing something
that is contrary to your right.
Senator Moore: Wasn't that always the case?
Ms. Townsend: It was always the case. It was just never in legislation
before. It was just the legislation didn't say you couldn't do it, so it was
Senator Moore: What's on the other side of that, that we have to put
it in legislation? To me, it just seemed to be part of the farm practice.
Ms. Townsend: I think there was concern that by changing the
legislation, somehow this exception to plant breeders' rights would be lost.
Putting it into the legislation ensures that it won't be lost.
Senator Moore: Looking down the road, is this going to give the plant
breeders any authority or power of persuasion over the farmers?
The Chair: Ms. Townsend, before you go to that follow-up question, I
noticed that Mr. Banack wanted to comment on that question.
Mr. Banack: Thank you.
As a grain producer in Canada, UPOV 91 is changing where the developer of the
seed will get their funding from. Today, when I buy certified seed across
Canada, and we do buy some certified seed every year to propagate to use on our
farm, we're paying a user royalty on the seed as we buy it. Plant breeders'
rights say UPOV 91 will change it to an end-point royalty, and that's where the
farmer-saved seed comes in. As I deliver that seed, I have to declare a variety
name, and that royalty will then be attached to the developer of that variety.
Patty is shaking her head, indicating that that won't be the way it is.
Senator Moore: Could you explain that again?
Ms. Townsend: I'm sorry, but that's not the case, Humphrey. There is
confusion, and that's part of the problem. It's going to take me a few seconds
to explain this.
While this legislation was being discussed, there were processes going on.
People recognized that there was a need to generate additional funds for
investment in plant breeding and research, so there were a lot of processes
going on across Canada to try to figure out how to do that. Unfortunately, it
was happening at the same time this legislation was being discussed.
There is nothing in this legislation or in UPOV 91 that allows a breeder to
collect a royalty on anything but the propagating material or the seed. The only
time that there could be compensation would be if that seed was acquired
illegally and the breeder was not able to collect their royalty on the seed. If
they can prove in civil law that they were not able to collect the royalty on
the seed or the propagating material, then they can be compensated on the
UPOV 91 does not change where the breeder is allowed to get their
compensation. If that was ever going to happen, the only thing this bill does is
give the minister the right to make regulations to change that should the
industry and the minister and the government at the time decide that's what they
want to do. It's very clear in UPOV language and in the legislation that the
only place where the breeder can collect the royalty is on the propagating
Senator Moore: Chair, maybe Mr. Banack could explain his side.
The Chair: Mr. Banack, would you have any comments to add?
Mr. Banack: Like I said, right now we do use certified seed on our
farm every year. We buy a fair amount of certified cereal seed. All our canola
seed is certified because it's a small amount. This applies in large part to us
in our cereals in Western Canada because we use a lot more volume of seed for
our productivity. Farmers' privilege comes in at the point in time in that
farmer-saved seed is a big part of what we do on our farms; farmers' privilege
is an important part of that.
However, the royalty system works. We're very accepting of that because we've
realized that developing new varieties does take dollars, and we have to be able
to support that through the use of those seeds. We believe we do that through a
commercial system. We on our farm don't go out and seed one variety from corner
to corner. We will use different varieties to develop which one is the best for
us, and that's the one we will continue to support through those royalties.
The Chair: Thank you.
Senator Moore: I'm not sure that Ms. Townsend's response satisfied
Mr. Banack: Yes, it does. We believe that end-point royalties are
applicable if the government chooses to go there, and that's where UPOV 91 goes
to. Our farmers recognize the ability and that need for us to pay a royalty on
our seed and on the stuff that we propagate and use on our farm. In the canola
industry, we've seen huge advances because we have gone to using a lot more
certified seed. Without the ability to collect royalties on propagated product,
it gets very difficult for companies to develop that seed and put it into the
Senator Moore: I understand intellectual property and the value of it
and the value of research to enhance the product and productivity of seeds, but
you said you'd have to pay again. When you buy seeds, is it marked on the bag?
How do you know what your rights or obligations are?
Mr. Banack: The rights and obligations are spelled out through the
act. When I buy certified seed now, with today's rules part of that cost does go
back to plant royalties and back to the plant breeder. Those will be laid out in
future legislation and by orders as to exactly where that royalty will be
Senator Moore: How do you get that information?
Mr. Banack: I guess through the seed growers, through the Canadian
Seed Trade Association and their members. When I'm purchasing the seed, I will
be notified of exactly where that royalty is being paid.
Senator Moore: Earlier in your remarks, you said that you would have
to pay a royalty again on —
Mr. Banack: Not again.
Senator Moore: What did you say?
Mr. Banack: One-time royalties.
Senator Moore: You're concerned that the Governor-in-Council could
change it. You said something that triggered Ms. Townsend's response, and I
don't know what that was and if you're now satisfied.
Mr. Banack: I think Ms. Townsend's response was that end-point
royalties would be there for sure. End-point royalties will be a decision, I
believe, by the breeder as to where they want to collect the royalties. As long
as it's collected once, our concerns are met.
Ms. Townsend: First of all, UPOV 91 doesn't set up end-point royalties
either. That is an individual decision of the member country, whether or not
they want to put in a system of end-point royalties or some other kind of a
system. There are systems around the world where they actually charge a portion
of the royalty on farm-saved seed. There are all kinds of examples out there,
but there is nothing in this legislation that establishes that. The breeder is
only allowed to collect the royalty on the propagating material when they sell
The other thing is that for a lot of companies where it's more of an
integrated system, where they do the plant breeding and research and variety
development and the marketing of the seed, it's all part of their margin.
Because they're developing it and they're getting the compensation for it, they
don't charge themselves a royalty. It becomes part of a margin.
Where it becomes more complicated is if you're licensing varieties from
someone else. For example, when Agriculture Canada develops a variety and they
licence it off to one of our member companies to multiply and distribute, our
member companies pay Agriculture Canada a royalty, and that information is
Senator Ogilvie: Perhaps you'll allow me to follow up with an
end-point question. Perhaps we'll clarify one issue that has been part of the
great public debate where farmers have been expressing upset that they're not
allowed to collect their own seed, reuse it and so on. You have explained that
they will have that right now.
The final question with regard to the royalty issue is: When farmers collect
seed that they've grown from their own crops, cleans it, stores it and uses it
the next year, are they be subject to any further royalty payment?
Ms. Townsend: Absolutely not.
Senator Ogilvie: I was clear on that, but that was the issue of
concern to the general public in the past. Thank you.
Mr. Prouse, I agree completely with the principle of your general statement
on eliminating duplication of testing in terms of getting approvals that can
slow down the process, and if something has been tested thoroughly in another
jurisdiction, why go through all of that testing all over again for the same end
point. This occurs in other product areas, such as pharmaceuticals.
Historically, there are good reasons for that, and there are nationalistic
reasons for doing that. The latter probably are not necessarily productive as a
reason for requiring additional testing. So I fully support the idea that we
shouldn't duplicate testing when testing occurs in jurisdictions where we have
complete confidence that their standards meet our requirements. Historically, it
was easy for us to do that. Certain countries were reliable overall, and today
we probably have certain countries in mind that we know are still reliable. We
cannot be absolutely certain of that, however, in terms of the actual
application of testing within those countries.
So in order to support the idea that we would accept approval decisions from
other countries, what would you see as a mechanism that would allow our
authority to do either random or deliberate checks on the materials produced in
those areas to ensure that they meet our standards, without the necessity of
going through the entire approval process?
Mr. Prouse: The data is what it is.
Senator Ogilvie: Is the producer of the data reliable? That's the
Mr. Prouse: Typically, they are being tested and the data are gathered
by the applicant. That process in and of itself becomes controversial to some.
No doubt you've heard that it's all corporate research. To turn that around, why
should the taxpayer pay for the supporting work for somebody who wants to move
forward with their own application? Typically, you're seeing presented the bulk
of the work done by the applicant. They're accepting the same set of data, and
that's our point: The testing has been done. Frankly, we have confidence in the
professional nature of the leadership of an organization like the CFIA and their
ability to designate the countries whose science-based regulatory scheme they
It's a real battle to find a coalition of the willing, if you will, out there
around the world of nations who believes in and supports science-based
regulation and rules-based trade. As you alluded to, a number of nations use the
regulatory system as a non-tariff trade barrier. This is what we're trying to
eliminate. This is partially a trade issue and partially an issue of
facilitating innovation in Canada. We think there is a tremendous opportunity
here to make Canada a very attractive place to do innovation by having a more
streamlined regulatory system. There is great opportunity.
Ms. Townsend: I want to add a little to what Dennis is saying. In our
case in the seed sector, where we're developing new varieties, we have to go
through certain processes. For example, if it's a novel food, we have to go
through the novel assessments and the determination of safety for humans,
livestock and the environment. In the case of variety registration, we have to
ensure that it actually is a new variety and will be better than or equal to
what is already out there. There are numerous international processes. For
example, between Canada, the U.S. and Mexico, we have cooperation where we
examine each other's data. Sometimes we generate the data together.
Another point I want to make is that in this world of biotech and other
advanced technologies, quite often the same company generates the data in
different countries based on the individual country's rules, but it is actually
the same company. Accepting the data generated in a different country doesn't
mean that it's being generated differently as they're doing the same testing. I
was told at the International Seed Federation that about 80 per cent of the
packages generated for approvals in different countries are the same across most
Senator Ogilvie: In your area, you have a very quick testing system.
If the first crop doesn't meet the promise, you know what has happened.
I'll leave it there. Thank you very much for your answers.
Senator Enverga: Thank you for the presentations.
The key objective of the bill is to encourage investment in Canadian research
that will increase crop yield, improve crop resistance to pests and disease and
meet the global trade demands that you mentioned. You're all positive about the
bill. Could you quantify or maybe rate the lost opportunities? UPOV 91 has been
around for a while. Have we lost any opportunities? If we delay further, how
many more will we lose?
Ms. Townsend: Specifically to UPOV 91, there are some really good
cases. We have a couple of small- or medium-sized companies that went overseas,
spent all the money in investment, met with a number of international plant
breeders and made arrangements to bring their varieties to test in Canada, only
to have them call back about a week later and say, "Oh, we didn't realize you
weren't UPOV 91 compliant, so we will not send our variety to you." So a number
of our Ontario companies missed out on some new varieties.
An agreement was made, just after Bill C-18 was tabled, between one of our
members and a very large European breeder to bring new varieties into Canada
that are now being put on the market, so they lost that.
The potato industry has had a difficult time and is falling behind. They
can't get some of the blight-resistant and virus-resistant varieties being
developed in Europe because the Europeans will not send them until we're UPOV 91
Mr. Prouse: Further to that, as a little demonstration of why the
climate of innovation matters, two years ago we saw a member company move the
bulk of its research division out of Germany and over to Raleigh, North
Carolina, to the research triangle. Why? They were frustrated with the European
regulatory environment and saw a better opportunity; so 300 key vital research
jobs left Europe and went to the United States.
Every day these global companies are making decisions about where to invest
globally. Where do we want that innovation to take place? Further to my opening
remarks, that innovation is taking place every day. Those investment decisions
are being made every day, and it's vital that Canada makes itself as attractive
as possible so that the research takes place in Canada as opposed to elsewhere.
Agriculture innovation is moving forward and continuing to take steps. We can
either be at the forefront of it or we can fall behind. Those are the policy
choices we make.
Senator Dagenais: I have a brief question for Mr. Banack. I would like
to hear your comments on the problems that farmers are having with traditional
financial institutions and on the average debt burden of farmers.
Mr. Banack: The average debt burden of producers in Canada, Canadian
farm debt, is well over $70 billion today and climbing steadily, as with the
rise of our value of products and value of our inputs and capital assets.
The debt burden of farmers, especially young farmers in this country, is
huge, and that's where the Advance Payments Program is so critical. They may be
at 70 or 80 per cent debt-to-equity ratios. That's very important for them. They
have to have those cash flows, and cash flows are important to manage those
The more established farms in Canada sometimes don't take advantage of the
Advance Payments Program. We have a very low participation rate in the Advance
Payments Program; probably only 20 or 25 per cent of the farmers in Canada use
them, but for the ones that need them, especially young farmers, it's very
important to that cash flow and the high debt rates that they're running.
Senator Tardif: I have a comment and a quick question in regard to
farmers' privilege. In the international areas where plant breeders' rights have
been implemented up to UPOV 91, there have been different ways of managing the
farmers' privilege. Some have outright farmers' privilege; some have no farmers'
privilege; and others, like what Canada is proposing, have a modified version.
The modified version means that it's able to be modified by regulations later,
so I would bring up this idea of changes being possible through regulations.
To get back to the question of end-point royalties, I asked a question to the
minister when he appeared before the committee in December about the possibility
of plant breeders collecting revenue on harvested grain, not only on the seeds
sold. The minister indicated in his response that that would only be if that
differential was made in the contract up front, and it would all have to be
worked out in a commercial agreement.
Mr. Banack, is that of concern to you, that the onus will now be on the
farmer to negotiate a good contract with the seed companies as to when the
royalty will be collected?
Mr. Banack: I guess to negotiate when it will be collected will be
something that the seed developer will propose to farmers. We farmers have that
ability right through; that will not be the only seed that's available to us. So
through commercial arrangements we have with other things, we believe that it
will be fair.
Those negotiations can be done on a fair basis because right now I can look
at 15 or 20 different varieties to seed on my farm for hard red spring wheat.
Out of those 15 or 20 varieties, I have the ability to negotiate to the best
that I can on either one of them, and I believe that can continue to happen in
the future, as long as we're not stuck to one or two varieties. If there are
choices out there, we should be able to come to those fair negotiations.
Senator Tardif: I'll leave it at that, chair.
The Chair: Witnesses, we have appreciated your presence and sharing
your opinions with us.
I will now ask the second panel to come forward.
Witnesses, thank you very much for accepting our invitation to be here and
sharing your opinions, recommendations and ideas. We have with us, from the
Canadian Cattlemen's Association, Mr. Ryder Lee, Manager of Federal Provincial
Relations; and by video conference, the president, Mr. Dave Solverson.
Thank you, Mr. Solverson, for being present by video conference.
We also have with us, from the Canadian Canola Growers Association, Ms. Jan
Dyer, Director of Government Relations; and from the University of Saskatchewan,
Dr. Richard S. Grey, Professor, Bioresource Policy, Business and Economics.
I am informed by the clerk that the first presenter will be Mr. Solverson, to
be followed by Ms. Dyer and then Professor Gray. I have also been informed that
instructions were given not to exceed five minutes in length, to permit senators
to ask questions on Bill C-18.
Mr. Solverson, please make your presentation.
Dave Solverson, President, Canadian Cattlemen's Association: Thank
you, Mr. Chairman. Hello from Calgary, ladies and gentlemen.
As mentioned, I am Dave Solverson. I'm President of the Canadian Cattlemen's
Association, and with you in Ottawa is Ryder Lee, one of our key staff people in
I am a cow-calf producer from Camrose, Alberta, and also a backgrounder and
cattle feeder. We have an operation that's a bit different in that we take all
our calves right through to finish. This has given me a good understanding of
the challenges at each step of production. Along with my partners, I am also
involved in some grain production and have been exposed to the ups and downs of
that side of farming in Canada.
Bill C-18 covers a wide array of acts. Some of the changes are of obvious
interest to livestock producers, for instance the updates to the cash advance
program. Some are not as obvious, and I will comment on both.
The changes to the Plant Breeders' Rights Act are positive. Canadian cattle
producers depend on innovation and improvements in feed grain and forages. We
believe that the update to UPOV 91 will assist in seeing investment in seed
development in Canada. The protections this act confers are not just for
companies but are also for institutions like universities or governments that
develop new varieties. Two of our major competitors, the United States and
Australia, have adopted UPOV 91 and we hope to keep pace with them.
There are overarching changes to several acts that bear comment. First is the
ability to incorporate by reference. The second is to allow for using documents
that are not Canadian. The third is to allow the minister to consider
information that is available from a review or evaluation conducted by the
government of a foreign state.
We have often found the regulatory change process to be time consuming or to
be duplicative of other jurisdictions that have rigorous approval processes. We
see these changes as positive for innovation and for the regulatory processes in
general. There are requirements set out for transparency and accessibility, and
really the test will be when these things are done. Enabling them in this
legislation is a good first step, and we will be involved as the authorities
granted by these changes are first tested.
Skipping down to the Administrative Monetary Penalties Act, we do have some
concern with how this is implemented, more than with the authority granted in
the proposed bill. The proposal is to have new levels of minor, $5,000, serious
at $15,000 and very serious $25,000 penalty amounts. One reading could be that
any violation should get at least a $5,000 fine. It is not clear that there will
be a continuum within minor, serious and very serious. The current CFIA
modernization consultation discusses compliance and risk-based enforcement that
would lead us to believe that a minor offence of little risk to human or animal
health would not yield a $5,000 penalty. This is down to implementation and is
not something we have a suggestion for the committee to amend, but we did want
to register this concern.
We do a lot of work like supporting certified livestock transporters and
communications about pre-transport decision making. When bad outcomes happen, we
support enforcement that will deter.
With the cash advance program that you have heard about from Alberta
breeders, feeders and others, the CCA supports the legislative changes in Bill
C-18. The positive change of granting the authority to add breeding stock and
changing some of the dates will match it up with beef production better than in
the past. We also support giving administrators more ability to handle the
different kinds of business setups that exist in farming today.
We will continue to work with AAFC on this file. They have done a good job of
consulting on the APP part of Bill C-18. As regulations are drafted to put into
force the authorities granted in the act, we will participate.
One of the things we will keep investigating is the ability to add the
Western Livestock Price Insurance Program to the list of programs that producers
can use as security for the Advance Payments Program. We would like to see price
insurance become a national program.
Thank you for inviting us to appear today. I appreciate the opportunity and
regret that I am not there in Ottawa to talk to you in person.
To close, the changes in this act are positive and should improve government
operations in the policy areas it covers. That follows other improvements we are
seeing in market access, which we have loudly supported.
Our major concern right now relates back to our competitiveness in the areas
of this act and market access. Labour shortages on farms and especially at
processing plants are hampering our ability to take full advantage of positive
changes that we have seen to date and expect in the near future. We are going to
need more Canadian workers to meet the new needs of markets such as China and
the European Union. If we cannot get more willing and able workers on farms and
plants from Canada and from abroad, we will continue to lose out on
opportunities the marketplace is presenting and on improvements that legislation
like Bill C-18 enables. This is already happening today.
The Chair: Thank you, Mr. Solverson. I just wanted to say to you that
the climate here in Ottawa is cool. I have to tell you that when this committee
was in Washington, D.C., this week, we did talk about COOL.
Mr. Solverson: That's great.
The Chair: That said, we will now move to Ms. Dyer.
Jan Dyer, Director of Government Relations, Canadian Canola Growers
Association: Thank you, Mr. Chairman and members of the Senate committee.
Thank you for inviting me here today to speak about Bill C-18, the proposed
"Agricultural Growth Act." Specifically, I'm going to focus on the proposed
changes to the Agricultural Marketing Programs Act and how they will impact the
cash advance program.
The Canadian Canola Growers Association, CCGA, represents 43,000 canola
growers. We are governed by a board of farmer directors representing all
provinces from Ontario west to B.C. We are also the largest administrator of the
Advance Payments Program in Canada. We offer 20 different crops in Manitoba,
Saskatchewan, Alberta and B.C.
A number of amendments contained in Bill C-18 are expected to foster
innovation in agriculture and provide more responsive government decision
making. In particular, we applaud the government for proposing the changes the
Plant Breeders' Rights Act to bring it in line with UPOV 91, the international
standard adopted by Canada's major competitors, while providing an exemption for
farmers to save seed to use on their farm.
Implementing UPOV 91 has been a long-standing goal for many within the
agriculture community as it builds up Canada as a place to invest and enhances
farmers' access to innovative and new seed varieties.
When it comes to the proposed changes to the Agricultural Marketing Programs
Act, AMPA, farmers will benefit from a more valuable and responsive Advance
Payments Program. The provisions allowing administrators to advance on any
commodity and to offer multi-year advance applications, as well as the expansion
of producer eligibility, are examples where farmers really stand to benefit from
The APP is an important and unique risk management tool, providing farmers
cash flow when they need it and the flexibility to sell their grain when market
conditions are favourable. Additionally, the program provides interest-free and
competitive financial rates, adding another tool for farmers when they're
managing their operations.
We know first-hand the importance of the program, particularly for new
farmers just getting established and farmers in need of flexible marketing and
financing options. The proposed changes will improve program accessibility and
streamline the program administration.
The challenges with grain logistics experienced last crop year highlighted
the importance of this program. The cash flow crunch resulting from the
extensive delays in selling opportunities led to a substantial increase in
demand for the program last year. The total of money advanced to farmers was
significantly more than the previous year. In the programs that the CCGA
administered, we advanced almost $1.6 billion to farmers during the grain
logistics problems last year. That was 50 per cent more than the year before.
The funds were advanced to more than 12,500 farmers compared to just under
10,000 in the previous year. So we think the program really filled a gap that
was needed last year when we had grain marketing problems.
By accessing financing under the program last year, farmers were able to
secure the necessary funds to purchase seed and crop inputs last winter. The
program provided a much-needed financial bridge until grain movements picked up
in the spring and farmers received payment for their crops.
CCGA is supportive of the proposed changes to AMPA and looks forward to
rolling them out to farmers this crop year.
What we're encouraging the committee to do is to consider and fully support
Bill C-18, and we really hope the bill is passed quickly. For us, timing is
really important. Normally new program applications in any given year start on
March 1. Farmers like to get their applications March 1 and have them filled out
so they can get their advances April 1. In order for farmers to take advantage
of as many opportunities as possible for this program this year, we hope that
the bill has timely passage. For this growing season, we hope that farmers will
be able to access as many of the new program benefits as possible with timely
We thank you for the opportunity to speak to you today and look forward to
answering any questions you might have.
The Chair: Thank you, Ms. Dyer.
The chair will now recognize Professor Gray.
Richard S. Gray, Professor, Bioresource Policy, Business and Economics,
University of Saskatchewan: Thank you, Mr. Chairman. It is my pleasure to
address this committee with respect to Bill C-18. Thank you very much for this
My name is Richard Gray. I'm a professor of agricultural economics from the
University of Saskatchewan. I am also engaged in a family farm at Indian Head,
For much of the past 12 years my research has focused on the economics of
agricultural innovation. From 2003 to 2013, I led the Canadian Agricultural
Innovation Regulation Network. I have been able to spend time studying
agricultural research funding systems in the U.K., France and Australia, which
are all signatories to UPOV 91. I will draw on some of that research in my brief
comments to you today.
There are many changes to legislation embodied in Bill C-18. However, I will
confine my remarks to the strengthening of the plant breeders' rights contained
in proposed sections 5 and 5.1 of Bill C-18. As I see it, the provisions of the
bill significantly extend the rights of the breeder and create the foundation
for annual royalty payments for the use of varieties.
Proposed section 5 expands the rights of the breeder from seed propagation to
conditioning to sale to export to import and to the storage of feed. Proposed
section 5.1 extends these rights of the breeder for seed to any harvested
material derived from the unauthorized use of seeds. These provisions of the
bill will allow a breeder to enforce a "bag licence agreements" that could
easily include provisions to pay an end-point royalty on the sale of harvested
For example, when a farmer purchases registered seed, he or she may be
required to sign a contract as part of a seed purchase agreement. The contract
can forbid the sale of seed and can specify that the farmer pay a royalty to the
breeder, say $1 per tonne, at the time that the variety or the harvest is sold.
If the farmer changes his mind and decides to make a sale of a product without
royalty payment, the breeder can use the provisions of proposed sections 5 and
5.1 to enforce the contract. In addition, they can pursue the grain marketers
selling grain where the royalties due have not been paid. This is almost exactly
how end-point royalties were introduced and enforced in Western Australia in
To be clear, although the farmer may retain the right to reuse seed, he or
she may be required to also agree to pay an end-point royalty as part of a seed
bag licence agreement. These are terms of a private contract.
The provisions of proposed section 5 and 5.1, which are part of the UPOV 91
framework, are somewhat controversial. However, I'm very much in favour of this
change for two reasons. First of all, these rights provide a mechanism for
public and private breeders to earn additional revenue from breeding activities.
Given the lack of public support for public research and the high returns to
research, the bill will provide much-needed plant breeding resources.
Second, Bill C-18 maintains the very important aspect of UPOV 91 that gives
other breeders the right to use registered varieties in their own breeding
programs. This mandated sharing ensures that firms wishing to use plant
breeders' rights to protect the sale of their varieties have to share their
genetics with anyone wishing to develop new varieties. This explicitly prevents
the use of plant breeders' rights to monopolize plant breeding genetics.
While I speak in favour of these provisions, I would go further and add a
note of caution and a suggestion to enhance the utility of Bill C-18.
First of all, do not expect that Bill C-18 will create a cascade of private
research investment into wheat, barley or similar open pollinated crops.
Australia introduced end-point royalties in 1994. Because new varieties had to
compete with existing royalty-free varieties, the royalty rates increased very
slowly over time. It was 16 years before end-point royalties got high enough to
fully fund a breeding program. Fortunately, Australia retained both public and
producer support for breeding during this long period of transition.
The United Kingdom was not so fortunate. The U.K. government pulled entirely
out of public wheat breeding in 1987. Because of the limited ability to raise
royalty income, the underfunded private research breeding system quickly went
into a tailspin and took 15 years to recover. If Bill C-18 is enacted, I expect
it will take years before royalties get high enough to support a private wheat
The second important lesson comes from France. In France, all farmers pay a
0.7 euros per tonne levy on the sale of their wheat. This uniform levy rate is
negotiated between farm groups and the seed industry. After the levy is paid, 85
per cent goes directly back to the breeders as a royalty based on their share of
varieties being sold, and 15 per cent goes to support public breeding.
This royalty system, which could be used in Canada, has four significant
First, it's very simple to collect and administer because the same deduction
is made for each variety. Farmers also have no incentive to misrepresent the
varieties that they are selling.
Second, this royalty structure, which uniformly applies to all wheat
varieties, generates immediate additional revenue for both existing and new
wheat breeders. Unlike the case in Australia, it does not take 16 years to get
to commercial levels. If we are serious about ramping up wheat breeding in
Canada, this is the shot in the arm that's needed.
Third, as long as the uniform royalty rates are negotiated with farm
organizations, there is no danger of royalty rates eventually reaching the
astronomical levels that we see in hybrid corn and canola.
Finally, some recent research of K. Bolek, a PhD research student of mine,
has shown that uniform royalty rates promote earlier adoption of new varieties.
This makes farmers better off. We estimate that using uniform end-point
royalties in Australia would increase the average wheat yield by about 1 per
cent, which is enough gain to pay for all the royalties being paid. If varieties
are priced the same, farmers will adopt the best varieties sooner.
To sum up, Mr. Chair, Canada becoming compliant with UPOV 91 is long overdue.
However, to address the underlying issues in breeding, we need to go one step
further and work toward the implementation of negotiated, uniform end-point
This concludes my remarks. I look forward to any questions the committee may
The Chair: Professor Gray, thank you very much for your presentation.
Now we will start with the question session. The chair will recognize Senator
Tardif to be followed by the sponsor of the bill, Senator Plett.
Senator Tardif: Thank you very much for being with us today.
Professor Gray, I'd like to ask a question of you, and if others want to jump
in, they can. We've heard a lot about end-point royalties, and the last panel
seemed to indicate that there was no possibility of end-point royalties being
collected. From your reading of the bill, is it your understanding that
harvested material could be subject to end-point royalties, and this would
depend on the contract signed between the farmer and the seed companies? Do you
see that as possibly being harmful to the farmers, as well as to research for
Mr. Gray: First of all, I do think it's a real possibility. Under the
current legislation, you can still have a contract for the sale of seed, but if
someone else gets a hold of that seed, you don't have a contract with those
individuals. This bill extends the right of the breeder to basically have
control over any unauthorized use of the seed, wherever it is in the supply
chain. So even if a neighbour, for example, grows the seed, the breeder could
have control over the unauthorized use of that harvested material. It makes the
contracts in a seed bag licence, where you actually have to pay a royalty, more
enforceable. That could easily be put into a contract, as far as I read the
legislation. It's a private contract negotiated between farmers and the seed
company. That's exactly how they did it in Australia. That's how they
implemented it. I do see that as a possibility.
I think that's a positive thing. If we're going to have to incentives or
resources for plant breeding, it's important that we have a way of paying for
breeding, and a reasonable way to pay for those is to actually pay in proportion
to the use of a variety or the use of a crop that's grown. I think it's a
reasonable way to set up a system for collecting revenue that can be used to
fund research, and I see it as a possibility and I see it as a positive
Senator Tardif: Only seeds that are registered can be saved by
farmers. Do you see it as a possibility that seed companies could start
deregistering their seeds in order to keep collecting the royalties or to
prevent farmers from going elsewhere and limit competition?
Mr. Gray: My understanding is that if a company deregistered their
seed, they in fact it would be out of the market and wouldn't get any revenue
Senator Tardif: Then it would be in the public domain, but there might
be an incentive for fewer seeds, or fewer choices, I guess, for the farmer.
Mr. Gray: That is certainly correct and a possibility, but I would
also say that varieties do get out-of-date at times. They're subject to disease.
There are other issues with them. I think it's important to have some ability
for a seller or breeder to say they don't want that on the market any more.
That's there, but I don't see it as a big issue.
Senator Tardif: I want to ask a question to Mr. Solverson from the
Canadian Cattlemen's Association. You indicated that the Administrative Monetary
Penalties Act could be of concern. Do you believe that farmers would truly
understand the difference between a minor, a serious and a very serious offence?
Mr. Solverson: No, I don't think we have a real, true understanding as
to the differences.
Senator Tardif: That's a concern that you have.
Mr. Solverson: Yes.
Senator Tardif: How do you feel about the amounts? Do you feel they're
Mr. Solverson: We're supportive of monetary penalties for abuse. For
instance, I mentioned in livestock transportation that there has been the odd
case in the past where animals have been transported and they shouldn't have
been. We are supportive of strong deterrence for that kind of thing. For
instance, on any other animal cruelty thing, we believe a strong deterrence
through fines is better than regulating the whole industry because of the bad
acts of one or two, so we are supportive of a strong monetary deterrence.
Senator Tardif: But you're concerned about how the administration of
the penalty may be put out.
Mr. Solverson: Yes. We're just a little unclear as to what would be
considered minor, what would be considered serious and very serious.
Ryder Lee, Manager of Federal Provincial Relations, Canadian Cattlemen's
Association: It reaches beyond transport to other things. The food
inspection agencies reach into things such as traceability, where you have a
producer that might have had cattle that cannot keep an ear tag in. If that gets
found, then that's considered against what the traceability rules say. When you
show up at an auction mart, everybody is supposed to have a tag. If one fell
out, you're technically offside. The choice is between a warning and a minor
offence. If you go by the letter and the minor offence says $5,000, that's a
little out of match with the risk to the food safety system. That's an
As far as the amounts that are in the act and the permission given to the
agency, that's fine. We support where these things should be amped up or moved
up as the seriousness moves up to be a deterrent, as it says, and not just a
cost to business, but when things are low risk, then —
Senator Tardif: Thank you.
Senator Plett: To all our witnesses, thank you for taking the time.
I've got one question for each witness, chair, and I'll try to be brief.
Mr. Solverson and Mr. Lee, you probably answered my question when you
answered Senator Tardif's, but I just want to be clear. Your concern with
monetary penalties is that it's not quite clear how they will work as opposed to
you thinking there's anything wrong with the monetary penalties.
Mr. Solverson: Yes, I agree with that assessment. Ryder pointed out a
great example where something as simple as an ear tag falling out could end up
being a very high fine, so we're just concerned about the implementation. We're
not concerned about the act itself.
Senator Plett: Thank you. Mr. Lee nodded when I asked the question. It
was an up and down nod, so I take that as a yes. Thank you.
Professor Gray, I'm not sure I understood you correctly. I want to read
something to you, and you tell me whether this is what you were referring to
when you talked about the U.K. I know you talked about end-point royalties, but
I think it all comes together with plant breeders' rights.
I have a document here from the Canadian Seed Grain Association. You
mentioned the United Kingdom, so that's why I want to read from it. PBRs were
granted in the United Kingdom in 1964. In 1987, 23 years later, the British
Plant Breeding Society reported its review on the benefits of said plant
breeders' rights. The report said:
Improved varieties of grass and clover have contributed to a greater cost
effectiveness of milk and meat production. For cereal productivity, official
statistics have shown that of the increased wheat yields since 1964, at
least 60 per cent was due to the use of new varieties, for barley the figure
was 30 per cent and for oats 25 per cent. These improvements have benefited
the national economy as the UK changed from net importer of cereals — only
60 per cent self sufficient in 1964 — to net exporter — more than 10 million
tonnes sold abroad in 1987.
Were you referring to plant breeders' rights being negative for the U.K.?
Mr. Gray: To go back to that period of time, up until 1987, the public
plant breeding at the Plant Breeding Institute of Cambridge University was
publicly funded, and it was a dominant breeder. They had about 80 per cent
market share of all the wheat varieties out there, and there was a remarkable
increase in variety yields over time.
When the government sold off the plant breeding institute to the private
sector, there was not enough money for private research, and basically it ended
up being fragmented. There wasn't enough royalty revenue coming in to support a
completely private industry. That's basically when the progress stopped, and it
didn't really kick in again until about 2005. If you look at U.K. yields, you
can see that they just went flat as a pancake.
Senator Plett: Until 2005, and they started to come up again.
Mr. Gray: And they started to come up again.
Senator Plett: Thank you, sir, for that clarification.
Ms. Dyer, you talked about being the biggest administrator of the Advance
Payments Program. I just want you to clarify something for me. We are bringing
in legislation that enhances the Advance Payments Program, and yet you are
already the largest administrator of the Program. So we already have an Advance
Payments Program. Can you simply tell me where this one makes it better?
Ms. Dyer: The legislation will give farmers a lot more choice in terms
of the administrator that they use. We're the largest administrator, but that
doesn't mean we're a huge organization that administers these programs. There's
also another large administrator in Ontario.
Right now in Manitoba, for example, if somebody wants an advance on wheat,
canola or corn, they can come to us for wheat and canola, but they have to go to
the Manitoba corn growers for that advance.
Senator Plett: Will this change that?
Ms. Dyer: Yes, it will allow the farmers to decide. The farmer could
decide that he likes the Manitoba corn growers' administrative approach and he
can take all his business there, or take all his business here or keep on doing
it the way he wants.
Senator Plett: And get advances for all of the crops?
Ms. Dyer: Yes. It makes it more flexible for the farmers. They don't
have to go to different administrators. They don't have to go back to the banks
a couple of times. That's one place where the flexibility improves.
There are a number of things in the legislation itself. It makes it much
clearer that legal entities where there is more than one partner in the business
can get advances, and those rules are clear now. It allows for multi-year
agreements. As the previous witness on the first panel said, right now you have
to get a whole new advance agreement every year.
So now if you're a regular client and you come back to us every year, you can
get a multi-year advance. You can do that one time every five years, and we'll
just keep renewing your advance. There is a whole lot less paperwork for the
farmers and more flexibility in how they pay back and the crops they can get.
Now they have some choice about the administrator that they can go to, for
example, if they like the way one group does it in terms of how they do their
online applications or how they process it. They just have a lot more choice in
where they can go.
Senator Moore: I want to thank the witnesses for being here. I want to
ask Professor Gray about end-point royalties.
In your research, when those types of arrangements are put in place, are they
made known to the farmer who buys the seeds at the time he purchases them and
does he sign a contract?
Mr. Gray: Yes, he signs a contract. I talked to the person who
implemented it in Western Australia, and they more or less had taken what
Microsoft uses for software: If you open this bag, then you're agreeing to this
licence agreement, so read it very carefully; by opening this bag of seed,
you're agreeing to the terms of this agreement.
Very much so the farmers are aware, and it's specified on public websites and
other places. In each variety, for example, the Wyalkatchem wheat variety in
Australia, they pay a royalty of $3.50 a tonne on the harvested materials. It is
known to producers months before the seed is available that that's going to be
the price on that variety. That does not change. Once they open that bag, for
the life of the variety, the royalty stays at $3.50 a tonne. It doesn't change
the next year; they can't change it. All the terms of the contract have to be
specified at the time of the initial purchase.
Senator Moore: So they're tied into that for the life of the seed.
Mr. Gray: The farmers are agreeing to handle a seed in a particular
way and harvest the material. Obviously, they could quit growing the variety, in
which case they could sign up for another agreement, but it ties the terms of
the contract to that initial licence.
Senator Moore: What happens if the harvest isn't in the quantity that
the farmer was hoping for and thought the seed was going to produce?
Mr. Gray: That's one of the big advantages of an end-point royalty.
The farmers actually pay in proportion per tonne of material that they're
selling. So if they grow 100 tonnes, they will pay the import royalty on 100
tonnes; if they grow 1,000 tonnes, they will pay on that. If they have a crop
failure that year, they'll not be paying much royalty or none if it's a complete
failure. If it's a big crop, they'll pay more total royalty that year, but they
have more revenue to do it with. It's a bit of insurance for the growers that
they pay the most royalties in the year when they have big crops.
Senator Moore: So if a crop isn't as large as they had hoped for, not
through any negligence of the farmer, is there any kind of compensation or
reimbursement from the seed seller?
Mr. Gray: No. Again, the varieties are well tested, et cetera, when
they go out there, but there's no warranty on them, if you like, that it's going
to rain this year.
The only thing I would say is that if it doesn't perform well, the breeder is
going to get less royalty because it didn't produce as much product. If it
performs well, the breeder will get more royalty because it grows well. The
incentives are lined up for good varieties.
Senator Moore: In as much as the end-point royalty comes from the
farmers, do they acquire any interest in the intellectual property resulting
from those research dollars, or do they get a reduction? What do they get out of
Mr. Gray: It depends basically on the breeding system and how that's
organized. In Australia, for example, there's another fund where farmers pay a
check-off or a levy called a grain research development corporation, so it's
more or less owned by farmers. That corporation is a shareholder in the breeding
firms. So when the breeding firms make money, it comes back.
Senator Moore: To the farmers.
Mr. Gray: Yes.
Senator Moore: Good.
Senator Tardif: That's not here.
Senator Moore: Is that anticipated to be part of the program in
Mr. Gray: At this time, there are a number of producer check-offs. For
example, Saskatchewan Pulse Growers and the Saskatchewan Wheat Development
Commission all fund breeding programs. The ownership of the varieties does not
reside with those groups but it could. It's a question of whether they want to
stake that claim and say they actually want an ownership. If the Saskatchewan
Wheat Development Commission funded a variety and they said that they want to
own that variety, they could get the royalties back.
Senator Moore: But it's not anticipated.
Mr. Gray: It's an option for them, and I think the wheat industry
particularly but also a lot of industries are trying to figure out how they will
manage going forward. Those are some of the options they're looking at.
Senator Enverga: Thank you for your presentations.
My question concerns plant breeders' rights. This is being administered by
the CFIA's Plant Breeders' Rights Office. It provides legal protection to plant
breeders for new plant varieties. This bill further strengthens plant breeders'
rights. It incorporates farmers' privileges into statue law, explicitly
permitting farmers to use seeds from the crops they grow. How will this
strengthen protections to benefit your sector? Will it help you at all?
Mr. Gray: A lot of research has been done looking at the rate of
return to investments in crop breeding activities, and a benefit-cost ratio of
20:1 is not uncommon. For every dollar spent, you get about $20 back in
benefits. This mechanism will give some additional revenue to breeders that can
be reinvested in breeding and will come back to producers in the form of higher
yields. So the fact that it's expanding or broadening the resource base
available to breeders will be positive as they invest more in research.
Ms. Dyer: The canola sector is different from some of the open
pollinated crops. About 90 per cent of canola is actually hybrid seed, so we
already have a value-capture system when we purchase seed.
For us, it's more about ensuring that there's investment in Canada, ensuring
that we have the legislative framework in Canada so that seed breeding
companies, for example, will come and invest in Canada and so there is always a
source of research and new technology coming to Canada. That is the important
benefit for us, and we see this regulatory framework as key to making sure that
we have companies that will invest here and that we have ongoing technology.
Senator Dagenais: I would like to thank our guests. My question is for
The bill will change the advance payments programs, and it will also clarify
the definition of eligible farmers. Moreover, it will update the eligibility
criteria for payment programs and definitely reduce paperwork.
What impact will these changes have on canola farmers, for example?
Ms. Dyer: I think our first panelist said it best. There are not a
huge number of people in the agriculture industry who use the Advance Payments
Program, but the ones who do use it really need it. They tend to be young
farmers. They tend to be people who don't have an established credit rating or
who really need cash flow assistance. So I think Humphrey Banack, from the first
panel, said that maybe 20 per cent of the industry uses the advances. I'm not
sure of the exact percentage, but this program is really important to a segment
of producers who don't access large amounts of commercial credit. They use it
for cash flow.
Last year is a perfect example where people just couldn't sell their grain.
Because of the transportation situation, elevators were not accepting grain for
delivery, so people were stuck. They had bills to pay and they couldn't sell
their grain. They needed the advance to be able to pay their bills and get
inputs for the next year.
For individuals who use the program even in regular years, that's how they
use the program. They'll take an advance instead of having to sell grain at any
market price in order to pay their bills. They can time the marketing of their
grain to maximize their profit, maintain their cash flow and buy seeding inputs
for the next year.
So the changes in this program are really aimed at making it way more
flexible for that group of people to use this program, to continue to take
advantage of the interest free part, to take advantage of the low rates that you
wouldn't get at a commercial bank for small volumes of credit, and to have an
expanded rate of the numbers of people who can use the program. As I said, farm
businesses are a lot more diverse than they used to be. There are a lot more
multi-party arrangements in terms of legal entities for farmers. It's not just
one farmer any more, farming just for himself. The rules are going to make it a
lot more flexible so that those kinds of operations can access the program
It's all aimed at making the program more accessible and more useful to
farmers. So I can see that it will be much more utilized in future. It's a much
more relevant program. Even this year, we've had many more people apply to the
program and welcome some of the advances that we know are coming. As I said, for
the people who do use this program, the maximum flexibility that you can have in
the program is very much appreciated.
The Chair: Mr. Solverson, do you have any comments?
Mr. Solverson: I'd like to comment briefly on the Advance Payments
Program. I think the changes made will work very well in our industry and work
closely with the producers who are using price insurance now.
In the past, farmers and ranchers have sold their animals at the same time
every year. Being able to insure their cattle through the Western Livestock
Price Insurance Program has given them confidence to keep their cattle, retain
ownership longer and add value to them. But that sometimes has put them in a
position where they have had cash-flow problems. To be able to take advantage of
the Advance Payments Program will work very well together with that.
I'd also like to comment that the CCA is very supportive of the changes to
plant breeders' rights. The limited research on feed grains has quickly put us
in a uncompetitive position with the U.S. The corn yields have gone from 100 to
200 bushels an acre, mostly from research, whereas our feed grains in Canada
have flatlined. We see these changes as a very positive opportunity to attract
some private research.
Senator Tardif: Professor Gray, you indicated that we should be
cautious about expectations with regard to the expansion of research in areas
like wheat and barley, based on the research that you found in the United
Kingdom and perhaps in Australia, that it took a while for private funding to
kick in. We've seen that government funding for public research has diminished
in recent years. If private funding doesn't kick in, where can we be assured
that the necessary research will be done to promote these new seed varieties?
Mr. Gray: My express word of caution — and you phrase it pretty well —
was that we have seen the number of lines, say wheat lines, that are being
tested and have gone down over time, and if we don't make for that up with
private research or producer-funded research in some way, we're going to see
what Mr. Solverson referred to as the flatlining of barley yields over time.
Wheat yields haven't been spectacular either. There is a real danger that we
could make a situation that's not great a lot worse if we actually withdraw more
from public research before the private research is able to generate enough
revenue. So I think you need the revenue model first. You have to actually see
the private investment before the government should be making any moves to
actually make room for the private sector. You actually need to see that revenue
or that investment there.
Senator Tardif: Or keep up the money for the public research.
Mr. Gray: Absolutely, yes.
Senator Tardif: And keep those positions in Agri-Food Canada doing
some of the research we need.
Mr. Gray: Certainly, yes.
Senator Plett: I would like Professor Gray, Ms. Dyer and Mr.
Solverson, if he wishes, to answer this question. Mr. Solverson just said that
corn yields have gone from 100 bushels to 200 bushels as a result of research,
innovation and doing a better job. Would you not agree that Canada is at the top
of innovation, if you will, with farmers and business people who want to improve
their own products? Do you not agree that our businesses and our farmers in
Canada will make every effort to keep up with the United States, that given the
opportunity and given some protections, as this bill provides, we have every
reason to believe that private investment and producer investment will be there?
Mr. Gray: Again, I would come back with a point of caution on that for
In the case of hybrid canola, they have had a model in place for a number of
years. It has actually generated a lot of revenue, and they have actually made
those investments, similar to corn.
One of the things that happened in canola when hybrids came along was that
they got a 35 per cent kick in yield, which meant that the new varieties were
way better than the free varieties out there. That created an ability to charge
a lot more for it. There's no 35 per cent increase in wheat yields out there.
That's going to be slow and incremental. As long as the gains are slow and
incremental, there won't be big royalty payments or big revenue streams for
wheat any time soon.
Eventually, perhaps 16 years from now, as those rates come up we'll get to
the point where a company can expect to make reasonable returns in wheat. But as
long as there are all these free varieties out there, and they're pretty good
varieties, we'll not see anyone come in and make a fortune growing wheat.
The Chair: Ms. Dyer, do you wish to comment?
Ms. Dyer: I think Richard has captured it very well. Canola growers,
in terms of the spirit of entrepreneurship, are very forward thinking in
Richard made a good point: We have to be careful about how we implement it
and not let go of all our public research because we need that. Canola growers
are also wheat growers, so we have to be conscious of how we implement it. There
are lessons to be learned about how this gets implemented, where some countries
have done better than others. That goes back to how we implement this
legislation after the fact and other policies that will help us get there faster
for all commodities.
The Chair: Mr. Solverson, do you have a comment, after which I'll
conclude with a comment?
Mr. Solverson: To Professor Gray's cautionary note, I agree. My
grandfather had a saying. He said, "The best time to plant a tree is 20 years
ago, and the next best is today." If we get started today on a new form of
research, it can only help us.
The Chair: Your father was a wise man.
We are sensitive to this issue, as are members of the Canadian Cattlemen's
Association. Members of the Standing Senate Committee on Agriculture and
Forestry were in Washington, D.C., this week. We arrived home at 11 o'clock last
night. Our delegation zigzagged from one office to another with congressmen,
congresswomen and senators. We brought to their attention the issue we have over
country-of-origin labelling, COOL. Mr. Solverson, we will continue to follow
this issue very closely.