Proceedings of the Standing Senate Committee on
Agriculture and Forestry

Issue No. 29 - Evidence - Meeting of May 9, 2017


OTTAWA, Tuesday, May 9, 2017

The Standing Senate Committee on Agriculture and Forestry met this day at 6 p.m. to continue its study on the potential impact of the effects of climate change on the agriculture, agri-food and forestry sectors.

Senator Ghislain Maltais (Chair) in the chair.

[Translation]

The Chair: Good afternoon, ladies and gentlemen.

[English]

The Standing Senate Committee on Agriculture and Forestry continues its study.

[Translation]

This evening, we are pleased to welcome Ashley St Hilaire, Director of Programs and Government Relations with the Canadian Organic Growers, and Derek Lynch, Associate Professor with the Faculty of Agriculture at Dalhousie University. Welcome to both of you.

[English]

Before we begin, I would ask the senators to introduce themselves, starting on my left with the co-chair of this committee.

Senator Mercer: I'm senator Terry Mercer, Nova Scotia.

[Translation]

Senator Dagenais: Jean-Guy Dagenais from Quebec.

Senator Tardif: Good evening. Claudette Tardif from Alberta.

Senator Gagné: Raymonde Gagné from Manitoba.

[English]

Senator Bernard: Senator Bernard from Nova Scotia.

[Translation]

Senator Petitclerc: Chantal Petitclerc from Quebec.

Senator Pratte: André Pratte from Quebec.

[English]

Senator Beyak: Lynn Beyak, Ontario. Welcome.

Senator Doyle: Norman Doyle, Newfoundland.

Senator Ataullahjan: Salma Ataullahjan, Toronto, Ontario.

Senator Ogilvie: Kelvin Ogilvie, Nova Scotia.

The Chair: Thank you, senators.

I would like to now invite the witnesses to make their presentations.

Ashley St Hilaire, Director of Programs and Government Relations, Canadian Organic Growers: Good afternoon, Mr. Chair, and honourable senators of the committee. We thank you for inviting us to speak to you today about the potential impacts of climate change and the repercussions of carbon pricing on organic agriculture.

I am the Director of Programs and Government Relations, Canadian Organic Growers. I'm joined here today by Dr. Derek Lynch, Associate Professor, Faculty of Agriculture at Dalhousie University.

In advance of our presentation, we submitted a briefing note to members of the committee which summarizes our perspectives and provides recommendations on government research policies and programs that we believe will support farmers in adopting practices to reduce their greenhouse gas and energy footprint. For today's testimony, we'll focus on key recommendations and discuss the science behind these.

Organic agriculture combines tradition, innovation and science to benefit the environment and the economy. While we often refer to organics as a sector, it's important to remember that organic agriculture is a standardized approach to producing food using energy efficient and climate-smart practices.

A key aspect of these techniques is that they allow farmers to enhance the soil health and fertility and retain soil carbon, thereby eliminating their need and reliance on external inputs such as synthetic fertilizers, which, as we know, contribute to over 70 per cent of Canada's total nitrous oxide greenhouse gas emissions.

We're not here to say that every farmer should pursue organic certification, but we think that every farmer who relies on external inputs to increase their soil fertility can benefit from the adoption of organic soil management practices.

This is particularly important to note as carbon pricing frameworks are implemented. These will inherently increase fertilizer prices and put a farm's profitability at risk if the farmer is not equipped with techniques to reduce fertilizer use.

However, when we talk about climate change and agriculture, we can't just focus on the reduction of greenhouse gas emissions. We also need to discuss farm level climate change adaptation strategies that will result in a more energy efficient and resilient farming system. Again, we can look to techniques used in organic agriculture as a means to achieving this.

I would like to turn it over to Derek now to speak on energy use in agriculture.

Derek Lynch, Associate Professor, Faculty of Agriculture, Dalhousie University, as an individual: I would first like to thank the committee for the opportunity to speak on the critical and complex topic of climate change mitigation and adaptation. My research is primarily in agronomy and agroecology, but for 10 years until 2015 I was Canada Research Chair in Organic Agriculture at Dalhousie. I have focused on examining the environmental impact of low-input or biologically intensive farming systems such as organic while also developing innovative management approaches for all agricultural systems.

I also recently served on the national sustainability and climate change working group of the national agricultural round tables. That working group had representatives from all the major agriculture and food sectors, including seafood and organic. It is actively providing a synopsis of the current status, challenges and opportunities for all sectors in agriculture related to climate change.

In the following I will provide a brief overview of research on three characteristics of farming systems related to today's topic, namely, embedded energy use, soil carbon status, and soil health and resiliency.

On the first topic of embedded energy use, a comprehensive assessment of the global warming potential of any farming system includes an assessment of greenhouse gas emissions, changes in soil carbon, plus quantification of the inherent energy cost embedded in producing the agricultural product, including from all inputs.

Most national studies of energy using across the entire agricultural supply chain, such as conducted in the U.S. or the U.K., have found that the farm management regime accounts for as much as 50 per cent of this embedded energy cost. Comparative studies on farms in Germany and Switzerland have found that most organic farms have lower embedded energy use per unit product than conventional farms, while our own review of the existing data of 130 studies, including Canadian, found organic grain and livestock systems reduced energy use and improved energy efficiency per unit product. Other more recent meta-analyses, such as that by UBC researchers, also agreed with these assessments.

However, while the U.K. and the U.S., as I mentioned, have completed life cycle supply chain or from field to fork assessments of energy by sector across Canadian agriculture, the supply chain energy footprint is poorly understood. Thus, one of our recommendations in our brief is to perform a life cycle assessment and energy audit of the Canadian agriculture and agri-food system. That assessment would look at each agricultural sector in detail with a focus on embedded energy use on farms, in transport, processing, distribution, retail, and in the kitchens of Canadians.

On the second topic of soil carbon status, the largest global terrestrial storehouse of carbon is in soil organic matter. Thus, even a small change in soil organic carbon contributes substantially to climate change mitigation. By some estimates, between a 3 per cent and 15 per cent offsetting of greenhouse gas emissions.

Maintaining and improving soil organic carbon is also an important adaptive strategy for increasing the resilience of soils to a changing climate. However, across many agricultural regions in Canada the shift to increase annual cropping and simpler rotations of often crops with low residue is projected to be leading to a decline in soil organic carbon.

While organic cropping systems often may rely on increased tillage, organic crop rotations necessarily are characterized by extended and more complex or diverse crop rotations, often including perennial forages with legumes, green manures and even added weed biomass. A number of studies have shown the net effect of these combined practices is that organic farming systems help retain soil organic carbon. Importantly, these types of agronomic practices are the key components of climate-smart agriculture being promoted globally.

On the third topic of soil health and soil resiliency or climate resiliency, soil health is a term that integrates the measurement of soil chemical, biological and physical properties. Many critical aspects of soil health are directly related to the maintenance and regular addition of organic matter to soil.

Conventional no-till systems reduce the disturbance of soil and thus maintain soil organic carbon and may improve soil health, but the rates of return of organic residues to soil can be low. More importantly, a no-till regime may not be permanent.

In contrast, organic farming systems are carbon intensive, relying on regular additions and incorporation of organic matter. The decomposition of these added organic materials directly drives biological activity and increases soil health. As a result of these practices and improved soil health, organic systems have been found in studies to perform particularly well under environmental stress as a result of improved water infiltration under intense rainfall events like we are having, and thus can lead to reduced water erosion and associated loss of soil quality and soil carbon or improved water retention and plant available water which enhances yield stability under drought periods. These are examples of key attributes of climate-smart soils and system resilience to extreme weather linked to climate change.

One of the recommendations in our brief, actually from the sustainability and climate change multi-sector working group, is to invest in research, tools and programs that support the verification of outcomes and demonstrate the impact of farming systems with respect to climate mitigation and adaptation or resilience.

Now I'm going to hand it over to Ashley for some concluding statements.

Ms. St Hilaire: We would like to end things by emphasizing the fact that practices in organic agriculture can be used to mitigate and reduce the impacts of climate change. These practices can be utilized by farms of any type and scale and are not reserved for those who decide to pursue organic certification.

We're concerned that carbon pricing will increase the cost of made-in-Canada agricultural products and food and potentially decrease the competitiveness of Canada's agricultural sector.

Furthermore, we are concerned that the rising costs of fertilizer inputs as a result of carbon pricing could be detrimental to a farm's profitability if they are not prepared with the knowledge and skills to adopt new soil- management practices. We believe, therefore, that it is prudent for this government to conduct an assessment of the economic impact of carbon pricing on the agricultural sector.

Furthermore, when creating policies like carbon pricing, which will force a shift in agricultural practices, it is critical that the government prioritize research, knowledge transfer, and on-farm extension services, which include organic techniques, so farmers can gain the skills they need to operate energy efficient, profitable farm businesses without passing on the cost to consumers.

Beyond that, we'd like to see the government develop a revenue neutral system for carbon pricing of the agricultural sector. This revenue should be used to incentivize and reward best environmental and climate resilient practices on farms beyond just carbon emission reduction. Carbon pricing is a top-down, punitive approach to reducing greenhouse gas emissions. It should be balanced out by programs that reward farmers who have taken steps to protect and enhance the resiliency of their farm ecosystems.

In closing, I thank this committee for the invitation to testify on the impacts of climate change and carbon pricing, and to provide recommendations on how our governments can support the agricultural sector's pursuit and understanding of climate-smart farming practices. We look forward to answering your questions.

The Chair: Thank you very much for your good presentations.

We will now begin the question period.

Senator Mercer: Thank you both for your very informative presentations. Very informative.

You said that review of existing data from 130 studies, including your own, Dr. Lynch, found that organic grain and livestock systems reduced energy use and improved energy efficiency per unit of product.

What is the cost of all this?

Mr. Lynch: Do you mean the cost of the research?

Senator Mercer: No, the cost effect that this reduction has had.

Mr. Lynch: If I understand your question, you mean —

Senator Mercer: You have talked about energy efficiency.

Mr. Lynch: Yes.

Senator Mercer: How much money is saved there?

Mr. Lynch: That's a very good point. Primarily, organic systems are more energy efficient because of the avoidance of using energy intensive inputs in farming systems, with some exceptions. You're not using nitrogen fertilizer, which is very energy intensive, but there would be other inputs that are energy intensive too. Even in livestock systems, there are concentrates and pesticides, et cetera. There is that direct saving in input costs. It's the primary saving in input costs if you shift to a lower input farming system, even if it's not organic. Those are the most direct savings.

Senator Mercer: I was surprised at your statement that conventional no-till systems reduce soil disturbance, and thus SOC mineralization and improve soil health, but rates of return of organic residues to the soil can be low and the no-till regime may not be permanent.

Mr. Lynch: Yes.

Senator Mercer: That's the first time that I remember hearing at this table that no-till doesn't have a permanent effect.

Mr. Lynch: It depends on if it's maintained permanently and you do not disturb. With a no-till system in particular, you're tending to not disturb the surface of the soil. It's a no-till system. You're accumulating soil organic matter in the surface, so it's really important that you do not disturb that and revert to tillage at any subsequent date.

In contrast, in a more diverse cropping system with deeper roots the organic matter in the soil carbon is not just in the surface. You are depositing it lower down in the soil profile. If you're emphasizing a no-till system, you're sort of putting all of your eggs in the surface of the soil. You might put it that way, and it's really more important you do not disturb that accumulation of carbon in the surface.

A recent review by VandenBygaart with Agriculture Canada looked at some extension information from across North America and found that while no-till has been widely adopted in conventional agriculture, the cases where it has been maintained permanently in a no-till status are not as high as people might assume.

For various reasons, farmers have had to go back in and till, maybe even one year in ten, but it has an impact on that deposit of soil carbon if it's an intermittent no-till system rather than a permanent no-till system. I would be glad to provide that review by VandenBygaart.

Senator Mercer: Thank you. That would be helpful.

My final question: You did say that one of the recommendations was that we perform a life-cycle assessment and energy audit of the Canadian agriculture and agri-food system.

That sounds like a good idea, but two questions go with that: Who would do that and how much would it cost?

Mr. Lynch: I could probably suggest the first, but honestly I would be guessing a bit on how much it would cost. I cited two studies. The comprehensive study done in the U.S. on their energy footprint from farm through to distribution, processing and even storage in the home by the beef and dairy sectors, et cetera was conducted by USDA, the U.S. Department of Agriculture.

It was a huge study. It's one thing to make the recommendation, but I appreciate it would be quite a piece of work. In the context of the importance of the contribution of agriculture to climate change, it's warranted.

Senator Mercer: I'm not suggesting that I'm against it. I'm trying to put it in context so that we know as we go along. If this recommendation were to come out in the end as one of our recommendations, I know the first questions we would get from the Department of Agriculture would be: "How much is it going to cost and who's going to do it?''

Mr. Lynch: Agriculture and Agri-food Canada is the obvious candidate. In fact, many of the components of that are already there. Many assessments of typical tillage and energy costs of tillage have been done by Agriculture Canada.

This is coming at it from a different angle, though. It's not just looking at the farming system. It's going right across the supply chain. That's very helpful, because then you can target your efforts in each sector where it's more likely to have impacts on the actual energy cost of the food product.

Senator Gagné: I believe that traditionally Canada has looked to Europe, where most of the research related to organic agriculture exists. I find that these studies tend not to influence public policy in Canada.

Would you like to comment on that?

Mr. Lynch: Would you like me to comment, or Ashley?

Senator Gagné: Both of you.

Mr. Lynch: Would you like to comment, Ashley?

Ms. St Hilaire: I can start it off. I'm sure you will have more to say.

Sometimes it's the perception of organics that holds us back from making gains in public policy. Much of the feedback we hear from Agriculture and Agri-Food Canada and the people that we work with in the minister's office is that they don't want to favour one sector over another. They have this equal approach to treating all of the different commodity groups.

That's where we need to paint a clearer picture of what organics is. It's not just a sector; it's an approach. Should we emphasize and encourage sustainable agricultural practices? Yes, and organic is a sustainable agricultural practice.

Sometimes it's the way we communicate and speak about organics. We always want to have policies that benefit all of the agricultural commodity groups. What we're trying to say is that when you invest in research in organics these are techniques that can be used by any producer. You don't have to do a whole slew of work to be certified.

In part, it's the way we have presented ourselves.

Mr. Lynch: From the research perspective, I think that's true. There are 20 or 30 years of research on ecosystem services in farming in Europe and payments to farmers. Sometimes 50 per cent of their farm income is because of bundled services, and organic was bundled into that. They have devoted a lot of research in Europe to see if it's really true that you get more soil organic carbon under organic farming.

In the last 10 years, there has been a huge advance in research in Canada and North America that has looked at organic farming. We have organic farms in Canada that have been running as commercial organic farms for 30 years or more now. I had a great opportunity to work on that kind of angle to see whether it's true that organic farming contributes broadly in ecosystem services.

It's very interesting to note that the Canadian consumer has shifted in the last 10 years. When polls of Canadian consumers were asked, even 10 years ago, why they buy organic, it was almost invariably a health benefit response. Now it's not. It's more of a complex response, with a good third of respondents saying that the perceived environmental benefit is why they are buying organic. That's important.

Senator Gagné: How can organic producers help others adopt low greenhouse gases practices? How can that knowledge transfer take place?

Ms. St Hilaire: Traditionally, extension services were carried out at the provincial level. We have seen in the last 20 or 30 years that these extension services have been greatly scaled back. One of the big ones was the prairie extension service that was running for 30 years that was stopped in 2010. For whatever reason, we haven't seen perhaps a value or we're not valuing these extension services enough.

A lot of it has to do with the reliance on technology to solve all of our problems. The research is showing us that technology can only get so far. You can only create a seed that's so good or machinery that's at a certain level. We have lost an appreciation for the technique and practices of farming, and an understanding of the ecosystem, the soils and how everything interacts in the environment. That's what people in organics are excited about, and that's what you learn when you're practising organics.

When these technologies fail, such as a pesticide that is pulled off the market and is no longer available, or the price of an input like fertilizer goes up, now we are seeing that farmers are left without another solution. They don't know where to turn because now their technology is not something they can use anymore. That's why we often say that organic is a business risk management tool because it protects against that price and input volatility, that unpredictability. For us, the extension services and knowledge transfer are absolutely critical to get the word out, to get that training and to make it available to farmers.

This government prioritizes knowledge transfer. We hear them talking a lot about it in the minister's mandate letter, but in the last organic science cluster program we are just finishing now the knowledge transfer budget was cut completely. It was a $1.1 million budget and they severed that. We are doing all this great research, and we are not given the opportunities to get it out into the hands of farmers so they can adapt and get better at what they are doing.

Mr. Lynch: I can comment briefly. If you think of some of the key agronomic practices within organics relevant to the topics of climate change and climate resiliency, none of them are unique to organics.

Lots of sectors are trying to encourage diversified cropping for lots of reasons that are often related to soil in terms of depositing soil carbon at lower depths, improving soil health and improving soil resiliency. You may have to diversify your cropping if you're an organic farmer, but it's not unique to organic farming.

Improved reliance on legumes is used to reduce fertilizer use, to be more efficient, to reduce the energy footprint of the farming system and to improve nitrogen use efficiency. Using green manures, protecting soil and reducing soil erosion are cross-coding recommendations that are not unique to organics.

It's very exciting to see some new funding coming forward in the next round of cluster funding across agriculture in Canada. These kinds of practices are being looked at to see how they can be adopted across all sectors. Nobody is saying that looks like organic farming. It doesn't really matter if it looks like organic farming. These are globally recognized as the ways to address the issues of soil health and soil carbon.

Senator Beyak: I have no questions. Your presentation was excellent, thoughtful and balanced. I learned some new things today, and I wanted to thank you very much for that.

I liked the ideas you gave us for keeping it revenue neutral and using revenues for research and development. Thanks for that.

Senator Petitclerc: I would like to ask you a question, because I do understand and you have explained it very well, on how less invasive organic growing and farming is. It has been well documented, and we know that.

I don't know that I want to call them the detractors, but even here in committee some people were saying at one time that if we all go organic, the planet will starve. How sustainable or how possible is it to go big scale in terms of costs and productivity? Is it realistic to want to expand organic farming?

Ms. St Hilaire: Often we focus on yield. It's all about yield and productivity is the key measure for success in agriculture. We always like to put that in the perspective of the health of the environment. At what cost to the environment are we willing to have these yields? What sacrifices are we willing to make?

Organic agriculture is catching up. How long have been investing in Canada in research in organic agriculture? It has been 10 years. We're on the second science cluster and are moving into the third. We've only had 10 years of formalized government level research in organic agriculture, and in that time the yields of many of those commodities are catching up.

One of the biggest impacts to increasing yield is using the right seed. You want to have regionally adapted seed that is bred for organic conditions. There is research out of Manitoba showing that when you're using the appropriate seed for organic production, the yields are competitive, if not better than conventional producers. We're making gains in that area in terms of productivity, but we never want to sacrifice organic productivity for environmental health, and that's where we're trying to find the balance with organic agriculture.

Mr. Lynch: I think you were partly asking about the size of the farms. I know the overall productivity was mentioned as well. I was on a tour last fall after a conference in Quebec when we visited some of the largest organic farms near Montreal.

The scale can be very impressive, but on productivity I always partly answer in this way. Sometimes organic is juxtaposed as a box to fit in and your level of productivity will be tightly constrained by it. If you have the opportunity, as I have, to look at the productivity of organic dairy production across Ontario, as well as organic grain and potato production, there is quite a range of intensity even within organic standards. You can have a very low input system. It might be more profitable, but there will be low productivity. Still within organic you can push the system. You can have a higher productivity that might not be as profitable, but the productivity will be higher and you'll find that scale. With that range, you're overlapping with a different range and the lower input of conventional production. There is a spectrum we need to play with, I guess I am getting at, in terms of integrating some of the practices we're talking about but absolutely maintaining productivity.

Organic has learned a lot in the last 10 years of where the weaknesses are and about increasing the productivity. There are a lot more synergies than two separate systems here.

[Translation]

The Chair: I would like to continue along the same lines as Senator Petitclerc: why are organic products so expensive? If an average Canadian family of three or four children is shopping in a grocery store's produce section and sees one bag of carrots for $1.95 and another for $5.95, which one do you think the mother of the family is going to choose?

[English]

Ms. St Hilaire: Thank you for the question. A criticism we receive in organics is that it is costlier and more expensive. We are seeing that price margin coming down. As our systems and our techniques improve, we're getting better at growing food and our yields are catching up. Our prices are definitely coming down on organic commodities.

It's important to understand why it is more expensive for these products. It comes in part due to the lack of available support systems for organic producers. Basically they assume all of the risk of their production systems, and that's reflected in part in the cost.

If you want to become organic, it's a three-year transition period. It's a high-risk period where you're learning a completely new way of growing food. Often there are infrastructure and capital expenses on your farm that you didn't have before. You have to invest in new equipment. For grain farms, they have to invest in grain mill storage on their own farms. It is a big expense for them. In addition, certification is an expense. In a lot of other countries there is a cost-share program for certification. We don't have anything like that available in Canada, so that certification fee is absorbed by the producer.

There are gaps in supply chain right now. There is a limit in terms of appropriate storage and transport facilities, and slaughterhouses that are willing to take organic meat and take on that risk themselves. Sometimes the transport costs are a lot higher. A variety of mechanisms result in a higher premium for organic products. However, consumer research shows that at the retail level, moms and millennials are the biggest consumers of organic products.

[Translation]

The Chair: Excuse me. I have another question, and the senators do, too. You mentioned in your brief that not all producers are accredited or certified. So I can find a bag of carrots labelled "organic'' at IGA, but in reality they are regular carrots for bunnies. How can Canadians be sure that the organic produce they buy is certified organic, and that they aren't being duped about the product, be it vegetables or another product?

[English]

Ms. St Hilaire: I think the point we wanted to make in our presentation was that the practices used in organic agriculture are available to all producers in Canada, whether or not they choose to certify. We're not saying that organic practices are limited to organic producers. It's a technique everyone can use.

At the supermarket you would never see anything that hasn't been certified to meet the Canadian Organic Standards. It's very heavily regulated. The Canadian Organic Standards are owned and held by the Canadian General Standards Board. They are enforced by the Canadian Food Inspection Agency. If there is a product with an organic label that is not true, in that they are not meeting those standards, it would be a fraudulent activity enforceable under the CFIA.

Right now we have a complaints-based model. They don't actively look for fraudulent cases. It would be based on complaints by consumers or anyone concerned about their practices. We have a high level of brand integrity in Canada as a result of this partnership we have with government to establish rigorous Canadian Organic Standards.

[Translation]

Senator Dagenais: Thank you to our witnesses. My first question is about carbon. Could you give us some concrete examples about the impact that the carbon tax will have on an average producer compared with a major producer?

[English]

Ms. St Hilaire: When we think about the carbon pricing of an agricultural system, most often we're thinking of the impacts on the cost of the inputs they're using. We're thinking about what will increase in cost. As a result of carbon taxes we expect it will be fertilizer because that's very energy intensive to produce and fuel on farms. We're thinking of the taxes that are going to happen. Those are the two main inputs that would be affected by carbon pricing.

Fortunately for organic producers, they are not using synthetic fertilizers so the impact of carbon pricing for them will likely be limited to an increase in the cost of fuel.

[Translation]

Senator Dagenais: Let's go back to organic products. Don't you think that the price of organic products limits the clientele to a select group of consumers who have the means to buy them? Average Canadians earning $30,000, $40,000 or $50,000 a year will choose less expensive products to feed their families. Don't you think that this is aimed at Canadians who have the means to pay for organic products?

[English]

Ms. St Hilaire: Another association we work with is the Canada Organic Trade Association do annual market research on the organic sector and they conduct Ipsos consumer polls. We're seeing that over 50 per cent of Canadians buy organics every week and hey plan to maintain or increase their purchases every year.

Canadians place a high value on sustainably produced food. They are very conscious consumers, and they are very literate. They understand that organics benefit the environment, and they are willing to pay a premium for that.

We're also seeing that the grocery bills of consumers who regularly purchase organic products are only about $25 more a week. It's not inaccessible. There is a myth that it's only available for the elite, and we're not seeing that.

The consumer polls we are seeing show that a diverse group of people buy organic. There are not any trends in terms of age or ethnicity, but we hear that mothers and millennials are the biggest consumers of organic products in Canada.

Mr. Lynch: If I could partly answer from a slightly different angle this question on the cost of food, perhaps you won't be surprised where I'm coming from. I'm thinking of who pays, in a sense, if we actually want to have farming systems that maintain soil organic matter, maybe increase soil carbon and partly address climate change. For some sectors in agriculture, achieving these latter goals would actually mean deintensifying with more diversified crop rotations and less frequency of the high value cash crops.

Ultimately as a country the question: Does that mean those prices of that farming system are passed on to the consumer, or does the country subsidize it as we've seen in other jurisdictions? The true cost of food is a much larger question. What's actually embedded in the cost of the food is a bigger picture and is relevant for all sectors in that regard.

Senator Tardif: I would like to ask you to expand further on two statements that are included in the information package you provided to our committee.

The first one is that Canada has negotiated organic equivalency agreements with 90 per cent of our major trading partners, including the U.S., European Union, Switzerland, Costa Rica and Japan. Agreements with Mexico and South Korea are currently being negotiated. What is understood by organic equivalency agreements?

The second statement is that Canadian value-added organic food producers are relying on imports and are having difficulty finding reliable and consistent sources of ingredients. Could you expand further on those two statements?

Ms. St Hilaire: An organic equivalency agreement allows for the free trade and labelling of organic products between two countries. An organic product produced in U.S., according to the National Organic Program, which is what they call their organic standard, would meet the same standards pf production as our own Canadian Organic Standards.

Between countries there are often differences in their organic standards, so the equivalency agreement is negotiated with governments. They do an evaluation of each other's organic standard and determine that it meets what they're looking for in terms of criteria to allow for an equivalency agreement. A product that is produced to the National Organic Program standards can be labelled organic here. They don't have to go through Canadian organic certification again.

We do not have an equivalency agreement with China, so any products from China labelled organic have been verified to meet the Canadian Organic Standards. Does that clarify it?

Senator Tardif: Yes, thank you. Was that an issue with the European Union trade agreement with Canada at all?

Ms. St Hilaire: We have had equivalency with them for a long time. I'm not as well versed on that. I wouldn't be able to fully comment.

Senator Tardif: What about the second statement saying that organic food processors that rely on imports are having trouble finding reliable and consistent sources of ingredients?

Ms. St Hilaire: One thing our partners in the U.S. have that we don't have in Canada is a national organic integrity database. In the U.S., it is operated by the USDA and it is updated every month. It lists every certified organic operator in that country, what they produce, and confirm their certification and who they are certified with.

If value-added processors are looking for ginger or an ingredient, they are using for their value-added commodities, there is no database they can access in Canada to see who is producing that ingredient. They're relying on brokers. They're relying on Google Internet searches. They're calling us, especially for producers of niche specialty crops that are difficult to find. As a result, they will import these products from international producers because they can't actually physically locate where they are in Canada. We make it very difficult.

Senator Tardif: Thank you. That was new information for myself at least.

Senator Bernard: I want to pick up on the points some of my colleagues raised about cost differentials. I would question the consumer research that says it's really not so much an issue.

I'm thinking particularly of people who live in poverty. I'm thinking about so many people in the country who are reliant on food banks. When food banks were first introduced they were meant to be a short-term measure, and we now have well over 20 years of people dependent on food banks.

I'm wondering what research has been done that links organic products, health outcomes and real issues like the real poverty people are struggling with. I don't think people who are going to food banks have the option of organic products. These are people that are using food banks but there are also people in food deserts. Again it's not a choice. I would assume they're not factored into the consumer research studies.

Who is participating in those studies? Where are the other marginalized voices? How are they impacted by the trend toward more organic?

Accessibility to organics is definitely a big issue that we talk about with organic stakeholders. We're always looking at ways to reduce the cost to make them more accessible.

The market research studies weren't conducted by our association. I would be happy to follow up and send you their report, so you can look at how they conducted the study and all the findings from it. I don't want to make any guesses about what assumptions were made in that research.

There are new options to access organics that make them more affordable. Direct marketing, actually buying the organic products directly from the farmer agricultural models are ways to do that.

For instance, on a personal note, I participate in one. For 35 a week, I get all the organic vegetables and more than I could possibly eat. That is a pretty affordable amount to spend for locally grown organic produce. Farmers markets are another option and roadside stands. Any time there is opportunity to reduce costs, organic farmers want to be profitable and sell more. They need to access and open up their market to more consumers, and those are ways to do that.

Senator Bernard: I would be interested in seeing more of the consumer-based research because I think that's pretty important. Also, I think the committee would be interested in understanding more about direct marketing and how that is working and if the direct marketing is actually reaching food deserts for people who wouldn't normally have access.

Senator Pratte: As happens quite often, I'm a bit at a loss here. Since your GHG footprint is usually lower, I would have thought you would favour a carbon pricing system because, as you mentioned in your brief, it should convince some farmers to change their practices and go into organics.

Shouldn't you applaud such a system and say, "Hurray, let's go,'' because your practices should be favoured by such a system?

Ms. St Hilaire: The point we wanted to make was that it certainly creates the incentive to adopt new practices that reduce fertilizer use, but we were concerned there aren't the support systems in place to make it easier and less painful for farmers to adapt, basically, to what the regulation will mean for the cost of their input. We're concerned for farmers that will be in that situation.

Fortunately, it will not be organic producers, but organic agriculture practices are available to those farmers. We want to help reach them. We think that's why extension and knowledge transfer are so important. They have to go to together.

It's the same with pesticides. When you pull a pesticide off the market, the whole industry starts panicking because they have no other tools available to them. I guess they feel abandoned by the government and resent policies being put in place that seem very top-down, that don't always consider the reality of the farming system and don't allow the time to adapt, basically.

Mr. Lynch: I would add that there was a remarkable consensus in the working group of the round tables talking about climate change that the carbon tax approach was too crude a tool, in a way. It certainly needs more study in terms of the likely efficacy of that tool in agriculture.

As an aside, a colleague of mine recently did a study in B.C. that isn't published yet. He is an agricultural economist at Dalhousie. He and some colleagues looked at the effect of the carbon tax on farm profitability and found it directly affected farm profitability. There is no indication as to whether it has had a benefit in terms of shifting practices toward mitigating climate change and adaptation to climate change.

The organic sector and others are saying that we need a more comprehensive strategy than just a tax. In the organic sector you would primarily be taxing fuel use, which is a very small part of the overall energy or carbon footprint of food products. It's actually missing the mark in that regard.

Senator Pratte: I was surprised by what you wrote in your brief. There may be a link between my first question and your answer to this one. You mentioned that in the U.K. and the U.S. they have complete life-cycle assessments of energy use in the agri-food sector, and we don't have that in Canada.

Mr. Lynch: As far as I know, and I stand to be corrected, when we did that review back in 2011 we couldn't find any comparable comprehensive assessment in Canada. Given the focus on climate change, it would seem very useful to have that.

Senator Pratte: Would there be major differences between what we have in Canada and what they have in the U.S. and the U.K.?

Mr. Lynch: That's an interesting question. In some sectors, including organic, we are very import-dependent. Maybe the transport would be more than 10 per cent of the overall carbon footprint. We need to assess that kind of contribution.

Senator Pratte: That area of research could be interesting.

Mr. Lynch: Yes, I think it's important.

Senator Mercer: I've added a question to my list based on what you just said. You said there's a Dalhousie professor who is doing a study on the effect of the carbon tax in British Columbia on the profitability of farming.

You may not want to say it, but we'd love to have his name and perhaps have a talk with him, if you could share that with us.

Mr. Lynch: Dr. Yiridoe, and he's in the Business and Social Sciences Department of our faculty.

Senator Mercer: I want to go back to what was said about organic pricing. I'm the principal grocery shopper in my family. I monitor the prices. I have noticed a slight decline in organic prices but availability is still an issue. However, you said that someone shopping organic would be paying $25 more a week. That's $100 a month. Then you also said the drivers of this market are mainly women and millennials.

These people had better be making good money. Senator Bernard and I represent a province where this is an issue. For a lot people, not just in Nova Scotia but all across the country, $25 a week or certainly $100 a month would make decisions about going into a grocery store and buying organic or non-organic pretty simple for them. They're buying the cheapest because they cannot afford it. We're having a hard enough time feeding our families as it is. I am not referring to those of us around this table. We're doing quite well, thank you very much, but a lot of people are suffering.

I'm shocked at that price. The cost benefit may be there for the farmer, but I sure don't see a cost benefit for the consumer. Unless you can get the price down to where it is the same as non-organic or better than non-organic, I know what decision the general public, while wanting to eat better and thinking they are going to eat better if they eat organic, would make. I know what decision I would make if I had to decide whether I was going to buy my granddaughter a pair of sneakers or I was going to eat organic. I would be opting for my granddaughter.

Mr. Lynch: It just occurred to me that a lot of sectors are being driven to branding that sort of parallels organic agriculture in some fashion, whether it's the carbon footprint of their product or it guarantees a sustainable fishery. Whether it's the retail sector that is driving this or the consumers broadly driving an interest in the overall impact of agriculture, in some ways that's a good thing, but it does increase the price of agricultural products. The organic sector is perhaps an early pioneer in the concept of your buying, in a sense, the farming system. You're not just buying the cheapest food possible, you're buying perceived benefits. We're finally doing the research to validate whether it's true or not. That's what you're buying. You're buying that farming system, not just a food product.

We've seen other sectors essentially paralleling that and sometimes, as I mentioned, being driven by retailers to do so as well. To me, this is part of a broader paradigm shift, you might say, in all of our relationships to food and farming systems. Who pays for that shift, those climate benefits. or whatever else there might be, is a very complex decision. In some jurisdictions like Europe it's not the consumer that pays. It's the country as a whole that pays.

Senator Mercer: The issue is we're going to have 9.7 to 9.8 billion people on this planet by 2050. If we can't find a way to produce enough food to feed them there will be a lot of angry people, and angry people cause world disruption. There will be famine and there will be wars, et cetera, et cetera. I don't need to explain that to you.

We need to find a way to feed them. One of the ways not to feed them is by driving the price up. We have to find a way to bring the price down and get production up.

The complicating factor is that many of these countries, including our neighbours, subsidize agriculture, and we don't subsidize agriculture in this country. That's a real issue. I'm not suggesting that we get into the subsidies to agriculture, but we're not playing on an even playing field here.

Senator Beyak: Your response to Senator Tardif raised a question for me. You spoke about other nations having a national organic integrity database and I wonder if that would be helpful to us here. Would it be costly for us to emulate one that's already working elsewhere, and have you discussed it with somebody?

Ms. St Hilaire: It's something that our sector has been recommending for many years now. We see it as a tool that can be used to verify an organic claim. It builds public trust and creates transparency in our system, which is something that we really value.

It was part of our submission on the next policy framework. It has the added value of helping bring together the industry for value-added processors, but most importantly for transparency and verification of organic claims. It would not be costly; it's just a fancy Excel database.

Senator Petitclerc: It could be a long answer, but maybe a short answer will suffice.

I want to go back to climate change. You have demonstrated very well how organic agriculture has less invasive impacts on climate change. Maybe it's there, but I did not get the effect of climate change on your sector, which uses the study we're doing.

Do you feel that the effect of climate change is the same on organic agriculture versus conventional agriculture? Are you equipped the same for those challenges, or maybe better? Is it more challenging than it is for conventional farming?

Mr. Lynch: The short answer is that risk management is challenging for any agricultural sector, as are unpredictability and especially climate.

I am an agronomy and soils person so I tend to think of soil. Organic farming at least strengthens the soil's ability to be more resilient and improve soil health. It's not unique to organic. Diversified farming and many other practices can improve soil health. That's one tool of resisting and adapting to climate change.

There would be plant breeding and there would be other things we could do, and globally we are doing, to try and anticipate the major challenges of climate change.

Senator Petitclerc: But in general you wouldn't say you are in a worse situation than conventional farming.

Mr. Lynch: There's some built-in resilience because you have a more diversified system inherently.

Ms. St Hilaire: We mentioned as part of the briefing notes that the higher amount of organic matter in organic soils benefits them both in periods of drought where they can retain water better and in periods of increased precipitation because they don't leach nutrients as much. The soil structure is more tightly held, so there's less erosion.

Those are the two events that we are seeing as a result of climate change. Organic farms are set up to fare better. That's why we often say they are more resilient and they are climate-smart practices.

Senator Petitclerc: Thank you.

[Translation]

The Chair: Mr. Lynch and Ms. St Hilaire, I sincerely thank you for your testimony. As you can see, we would have needed two hours of your time. Several issues remained unresolved. I hope you will have the opportunity to come back. Your testimony was very interesting and constructive. The senators asked some good questions because we are welcoming several other agricultural groups, and questions about organic products come up often. I would say that we haven't yet found the balance; some days it's off to one side, and the next day it's back up. Getting the organic system to occupy the place you want it to have the Canadian public will take some time.

(The committee adjourned.)