Proceedings of the Standing Senate Committee on
Agriculture and Forestry
Issue No. 63 - Evidence - Meeting of April 2, 2019
OTTAWA, Tuesday, April 2, 2019
The Standing Senate Committee on Agriculture and Forestry met this day at 6:13 p.m. to study how the value-added food sector can be more competitive in global markets.
Senator Diane F. Griffin (Chair) in the chair.
[English]
The Chair: I’m Diane Griffin, chair of the committee, and I welcome our panel with us this evening. I’m going to ask the senators to introduce themselves, starting with the deputy chair.
[Translation]
Senator Maltais: Senator Ghislain Maltais from Quebec.
[English]
Senator Doyle: Norman Doyle, Newfoundland and Labrador.
Senator Oh: Victor Oh, Ontario.
[Translation]
Senator Dagenais: Jean-Guy Dagenais from Quebec.
[English]
Senator C. Deacon: Colin Deacon, Nova Scotia.
Senator Kutcher: Stan Kutcher, Nova Scotia.
Senator R. Black: Robert Black, Ontario.
Senator Moodie: Rosemary Moodie, Ontario.
[Translation]
Senator Miville-Dechêne: Julie Miville-Dechêne from Quebec. Sorry I was late.
[English]
The Chair: We have with us tonight a panel that’s going to be talking to us as part of our value-added study. From the Association of Canadian Port Authorities, we have Wendy Zatylny, President; Debbie Murray, Director, Policy and Regulatory Affairs; and we also have Tim Heney, Chief Executive Officer, Thunder Bay Port Authority.
I understand the Association of Canadian Port Authorities is going first, and Ms. Zatylny will be our lead.
Wendy Zatylny, President, Association of Canadian Port Authorities: Good evening, honourable senators. Thank you very much for the opportunity to speak to you this evening. I know it has been a while getting here, and we’re very pleased to be here.
For this evening, as you’ve heard, we have a panel. I’ll be providing a broad national perspective on behalf of the entire membership of the association, while Mr. Heney will speak to the particulars as a key Canadian agri-food export port.
Before we begin, though, just a quick reminder of who we are. We represent the 18 Canada port authorities that are located on both the Atlantic and the Pacific coasts as well as in the St. Lawrence River and in the Great Lakes. Last year, our members moved over 343 million tonnes of cargo, including almost half of Canada’s wheat. We also welcome over 1.3 million cruise passengers per year and we support nearly a quarter million jobs. Our supply chains stretch far beyond our ports and well into the Canadian “heartland.”
Certainly some of the top commodities handled by the ports are either agriculture, agri-food or an input into the Canadian agricultural sector. And the impact of the various trade agreements we’re seeing, such as CETA, for example, as well as shifting trade flows overall, are driving increased demand for offshore movement of agricultural products.
For the Canada Port Authorities, supporting the competitiveness of the value-added food industry has three aspects. First is the evolving role of ports and the nature of port authorities; second is the impact of innovations in data and data management; and third remain the foundational needs around infrastructure expansion, both in terms of funding mechanisms and financial flexibilities. I’m going to touch on each of these in turn over the next few minutes.
On the first point, ports as value-added partners in the supply chain and in food production, it’s important to recognize the evolving role of ports over time. Where once ports were simply places where ships arrived and cargo was loaded and unloaded, today Canada’s ports have become facilitators within supply chains of multiple industries. Today’s ports are logistics experts and business developers, providing space and opportunity for value-added processing facilities within their port boundaries.
Perhaps the most illustrative example of this is the Port of Hamilton, which has reoriented themselves from steel to agriculture. Their goal is to become the agricultural hub for the shipment of pulses and other agri-foods serving farmers in southern Ontario. Moving towards this goal has facilitated more than $200 million in related capital investments over the past decade but leading, in turn, to the attraction of higher order food processing enterprises, such as a new soybean and canola crushing facility, flour mill, sugar refinery and brewery, all established within the past three years. This investment has resulted in agricultural cargo increasing from 9 per cent of the total port tonnage in 2008 to almost 27 per cent last year.
In their own way, all of Canada’s port authorities are exploring similar evolutions. The Port of Trois-Rivières, for example, is developing a port industrial zone; essentially, a port-driven logistics centre that will create a critical mass of supply chain partners who will collaborate to ensure maximum fluidity in the transportation system.
On the topic of value-added food, an interesting point to note is that most of the cocoa beans that come from Africa into the eastern seaboard come through the Port of Trois-Rivières. These cocoa beans are shipped down to a processing facility in the Eastern Townships that turns the beans into paste. The paste is then shipped to chocolate manufacturers in the eastern part of Canada and in U.S. In fact, in Trois-Rivières itself, there is now a globally recognized award-winning chocolaterie that has returned that product into a high-end food product. This is the kind of stimulus we have in mind when talking about the developmental potential of ports.
There’s tremendous activity already occurring and potential for so much more. But from our perspective, our ports must be empowered to continue to evolve. Currently, for example, the language in the Canada Marine Act and its regulations limit CPAs to providing shipping and navigation services. To a degree, this language has restrained the ports’ abilities to create these multi-modal logistics facilities. So modern port legislation and regulations need to encourage port authorities to participate in the entire supply chain system.
Now to my second point. In this new world, ports are also turning to innovation in a big way, including data and data management. Given current global shipping practices, all cargo is in some way attached to information or data.
Numerous disruptive technologies such as blockchain applications are now being tested in ports in the martime sector. Exploratory steps are now being taken by numerous partnerships and alliances, including Canadian ports. For example, the Halifax Port Authority has joined TradeLens, a digital global platform developed by Maersk and IBM. Halifax’s goal is to participate in the development of a secure digital ledger system promoting the sharing of information across the global shipping industry to reduce costs and improve productivity.
On that point, today’s challenge is about having all the stakeholders on the same page and being open to sharing data. CPAs must be empowered to bring partners together to develop a consistent national approach and also work with other relevant agency such as Canada Border Services Agency, who must also be encouraged to participate. To that point, we know that Transport Canada’s data initiative, an important project to capture, analyze and disseminate supply chain data among partners, should be given long-term funding and support.
At the end of the day, though, one cannot build without a sound foundation. For ports that is infrastructure, namely, continued support for development and expansion within ports.
Earlier I mentioned the growth in agricultural throughput and shifts in global demand for agricultural products. Our ports are racing to respond so that new investments in terminals, cargo handling equipment and intermodal linkages are under way. For example, the Port of Vancouver is seeing construction of its first new grain terminal in 50 years. An important element in enabling ports to do so has been the government’s Trade and Transportation Corridors Initiative investment in gateways and ports, including the National Trade Corridors Fund. This program was originally oversubscribed but has seen funds accelerated in the Fall Economic Statement, with another $776 million allocated over the next three years with an ongoing call for projects.
For the best leverage of this funding, though, a few more pieces are still required, notably improvements to the letters patent processes to allow ports to manage their lands in a timely and commercially driven time frame.
Second is expanded mechanisms to explore innovative funding mechanisms for port projects, including allowing port authorities to create non-wholly-owned subsidiaries for port projects and allowing borrowing limits to be determined by commercial markets.
Our recent ports modernization review submission, which you have copies of — and we invite you to look at it — also highlights the need for a comprehensive transportation strategy that ensures optimal use of all parts of Canada’s transportation system.
With that, I’d now like to turn this over to Mr. Heney, who will bring a hands-on perspective, especially as it relates to the seaway as part of that system.
Tim Heney, Chief Executive Officer, Thunder Bay Port Authority, Association of Canadian Port Authorities: Good evening. On behalf of the Port of Thunder Bay, I want to thank the Standing Senate Committee on Agriculture and Forestry for the invitation to appear before you today.
I’m the CEO of the Thunder Bay Port Authority. The Port of Thunder Bay is Canada’s furthest inland port and the Western Canadian entry point to the St. Lawrence Seaway system, the largest inland waterway in the world.
This year marks the sixtieth anniversary of the seaway, which opened in April 1959 and is Canada’s original gateway and the country’s largest engineering achievement. Originally built to provide access to global markets for Western Canadian agricultural exports, the seaway has seen significant investment over the past eight years, upgrading the locks and installing new technology including hands-free mooring, 3D navigation, laser ship spotting and remote bridge operation. There’s available capacity to grow volumes on this route with little or no added investment.
The seaway takes pride in its 99.9 per cent availability record and is a safe and reliable transportation route with the lowest carbon footprint of any mode of transportation from the Canadian Prairies to tidewater.
A total of 41 million metric tonnes of cargo was handled through the seaway last year. Of that, Thunder Bay is the largest export port on the seaway, with the main commodity being Western Canadian grain.
Export grain is a value-added product. This starts at the farm level, where grain and oilseeds are developed with the end user in mind and have specific quality characteristics that add value. Producers spend money on crop inputs, fuel and machinery to create a valuable commodity. The grain handlers clean and blend the grain to enhance the value of the export product. The movement of the grain creates income for grain companies, railways, ports and vessel owners and generates tax revenue at the local, provincial and federal level. In essence, there’s a value chain from farm to end-use customer which provides income all along the chain.
A great example of this is Warburtons bakery in the U.K. They work with Canadian farmers and grain companies to grow specific varieties of wheat to enhance the quality of the baking products they sell in Britain. Farmers in Canada are paid a premium to grow wheat to meet Warburton’s specifications and the grain companies are paid a premium to segregate and preserve that wheat from farm to the export vessel.
Thunder Bay is the most efficient grain port in Canada, with the shortest rail car cycle time from Western Canada, the fastest ship turnaround time, the largest grain storage capacity and lowest harbour dues this the country.
The port has seen dramatic efficiency and volume gains since the elimination of the Canadian Wheat Board monopoly in 2012 and has established itself as a reliable project and general cargo gateway for equipment and steel products originating in Europe bound for Western Canada.
Since the elimination of the 25 per cent import duty on foreign-built ships, a total of 16 new Canadian lake vessels have been built using the latest technology to increase speed, carrying capacity and reduce carbon footprint. A significant portion of the grain handled at the port is carried by the Canadian lake fleet and transloaded to ocean vessels in Quebec for export to markets in Europe, North Africa, Latin America and the Middle East. The port also loads ocean vessels for direct export to overseas markets.
The Port of Thunder Bay and the St. Lawrence Seaway have significant available capacity to efficiently and safely handle future growth in Canadian exports from Western Canada without major investment in infrastructure. The seaway is positioned to reach its potential as an essential transportation gateway for Canadian exports and imports. This will require, in broad terms, modernization of the regulatory regime on the seaway, fostering innovation and modern work practices, with the goal of increasing cargo on the system and the government recognition and prioritization of the seaway as a significant grade corridor.
The Chair: Thank you. Great presentations. We have a number of senators who want to ask questions.
[Translation]
Senator Maltais: Welcome to our witnesses. This is a very interesting area that particularly affects the Maritimes and Quebec.
I have three points to highlight. This year, the ice-out in the St. Lawrence River has not been very successful. The icebreakers are outdated. Even museums no longer want them.
First, have you made representations to the government to replace those icebreakers, which are essential to the proper operation of the seaway? Second, I hail from northern Quebec. I live in Quebec City. Cruise ships in the St. Lawrence ports are expanding more and more. You need only think of Quebec City, Montreal and Baie-Comeau. When 1,500 to 2,000 people arrive in the Port of Quebec, they cannot be left on the wharf. There is an issue with services for visitors, and it is not getting better.
Third, I would like to talk about the seaway. I remember when it was inaugurated by Eisenhower, Diefenbaker and Louis Saint-Laurent in 1959. Today, in 2019, is it still large enough for new ships? Could it improve grain transportation from Thunder Bay to Port-Cartier or Baie-Comeau, where the grain is stored during the winter? Aren’t the current ships that transport grain a bit too large for the seaway?
I watch them go by from time to time. If you have an opportunity to see them, you will note that there isn’t a lot of space between a sheet of paper and the wharf. Is seaway expansion planned? It serves the Great Lakes and some of the U.S. ports. Do you plan to ask the federal government to introduce the idea of seaway expansion?
Ms. Zatylny: Thank you for your questions, senator. You make some excellent points. I will try to answer you in French. I will do my best, but please be patient with me.
As far as the ice-out in the St. Lawrence goes, we are aware of that problem. We are working with other associations, such as the St. Lawrence Economic Development Council and the Chamber of Marine Commerce. We are recommending that the government increase the number of icebreakers in the St. Lawrence and in the seaway. We have actually signed a letter. In our opinion, the government should acquire new icebreakers as quickly as possible, even if it means renting them until our own icebreakers can be built. Those are recommendations we have made a number of times.
[English]
Mr. Heney: The government has purchased four used icebreakers from Norway, and they’re being outfitted currently. There may be one in service now, but the rest are currently being outfitted for service and will shortly be increasing the fleet, happily in an efficient way. So there is some progress being made on that front.
I agree the icebreakers we have are getting older. As we speak, the one in Thunder Bay is currently broken down. That’s a Canadian icebreaker.
They’re getting old. It is a tough business for a ship to break ice. We definitely need all the help we can get. Fortunately, there are four new ones — new to us — coming into service.
[Translation]
Senator Maltais: What you just said is very interesting, Mr. Heney. Norway is purchasing icebreakers, but experienced people, ship captains, are warning us. Those icebreakers are built to clear Norwegian fjords. They do not travel distances of 70 kilometres, such as the distance between Baie-Comeau and Matane. Ice depth must also be taken into account. I trust the St. Lawrence ship captains. I don’t think the solution consists in investing in old ships to try to turn them into a Cadillac, a Mercedes or a Bentley. Canadians know more about the state of the St. Lawrence and its whims than Norwegians do. That is what I have heard experts say.
The proof is that the Government of Quebec has purchased four ferries abroad that travel between Baie-Comeau and Matane. We now have a fifth boat from Norway and, before arriving here, it hit a wharf in Norway. There is no link between people in North Shore and South Shore. I am suspicious when the government says it will purchase those boats to refurbish them.
Why not build them here — we have shipyards in Saint-Jean, Halifax and Quebec City—instead of purchasing used ships? In the navy, there are submarines that don’t go in the water. In the air force, there are planes that don’t fly. Will the government buy icebreakers that will have to stay in docks? Why not get solid equipment instead of trusting people who are not familiar with our weather conditions or our river? That is what I am wondering.
[English]
The Chair: I don’t know if that’s a question to which our panel can respond. We’ll take it as a statement. We certainly know how the senator feels about it. He’s made himself very clear. We’re not guessing.
Senator Oh: Welcome, witnesses. An efficient and reliable port system for moving Canadians’ agriculture products to market is key to the continued success of Canada economy. The Canada Marine Act puts in place the measures to safeguard the country’s competitiveness and trade objectives. Could you explain the impact of the Canada Marine Act on all stakeholders in the agri-food supply chain? How does it affect our agri-food supply chain?
Ms. Zatylny: That’s a big question. I will give it my best shot, senator.
Essentially, the Canada Marine Act is what governs the constitution and operations of the Canada Port Authorities. The port authorities themselves are bound by and are limited and guided by the provisions within the act.
In our presentation earlier, when we referred to the limitations in the Canada Marine Act, it is because right now, the act limits and constrains us to shipping-related activities purely as it relates to ports and waterways, whereas with the evolution of port authorities that have gone beyond that into becoming logistics experts and logistics processing facilities, in order to be able to achieve that, we have to go beyond the boundaries of the act. How that has an impact on stakeholders within the agri-food industry is simply that it becomes extremely difficult for the port authorities to engage in the kinds of development projects with agri-food partners such as the ones that I referred to that are occurring in Hamilton. That was done as a separate financial agreement, but the port authorities themselves can be bringing so much more to the table for their agri-food partners.
Mr. Heney: It’s an interesting situation. Thunder Bay, has been a grain port since the 1800s, so it predates the Canada Marine Act, the Port Authority and the Harbour Commission.
The elevators and infrastructure are mostly privately owned by the grain companies in Thunder Bay. I would say the usage of the seaway for exports is more hampered by old regulations around pilotage, cabotage. Modernization of the regulations in Canada would greatly help the efficiency and capacity of the seaway system, much more so than the Canada Marine Act.
The other issue is Canada’s competition laws which permit the application of protective covenants to grain assets both in the port, in Western Canada and throughout the country. So we’re actually hampering competition in some cases. I think some modernization around our older laws, which don’t exist in many other countries, would help the efficiency of the system.
Senator Oh: Do you think Canadian ports have the appropriate infrastructure in place to support the future demand for transport services from the agriculture sector and the agri-food chain?
Mr. Heney: We still have the capacity. Thunder Bay was the largest grain port in the world at one point. In our estimation, it still has the capacity to move 21 million metric tonnes of grain. It currently moves about 7, so we’re working at about 30 per cent capacity.
Senator Oh: Does the grain you move go to the Pacific Rim or only to Europe?
Mr. Heney: We ship to Europe, North Africa, the Middle East and Latin America. We don’t generally ship to Asia. At one time we did, but that’s now handled through Vancouver and Prince Rupert.
Senator Oh: With climate change now, does it affect the water level? Is it too high or too low for the future of shipping?
Mr. Heney: That’s an interesting one. In 2007, we saw almost record low water levels, and people at that point said the whole system is drying up, climate change is coming in, it’s over. Then within three years, we’re at the highest levels we’ve seen in 80 years.
Senator Oh: So there is no climate change?
Mr. Heney: It’s very difficult to predict. You’re seeing higher water levels rather than lower, which is interesting. It wasn’t predicted at the time.
Senator Oh: Any comment from Ms. Zatylny?
Ms. Zatylny: To respond to your question, one of the interesting things is when you look at the marine transportation system within Canada, there is a difference between the inland ports and the coastal ports. Part of what we’ve been recommending is the need for a national transportation strategy that ensures a full optimization of the entire parts of the system so that Tim’s capacity is completely fulfilled and utilized.
What we are seeing is on some of the coastal ports, for example, they do not have sufficient capacity right now. They’re building as quickly as they can. Vancouver is building a grain terminal. There is new construction happening there. Prince Rupert is expanding. Halifax is trying to do the same.
There is insufficient capacity there and then extra capacity within the inland system. A national transportation strategy would ideally help to smooth all of that out, still understanding that virtually every single port, other than Tim’s, is needing extra infrastructure.
The Chair: I am reminding everybody that we have about 15 minutes left so we have to be snappy.
Senator Kutcher: First, to Ms. Zatylny, one question with 14 subsections. What are the most pressing security challenges in the ports? And how do those, if any, affect our global competitiveness?
Mr. Heney, with the new technologies and improvements in the seaway, what other products that aren’t currently being shipped there should we be looking at to ship there?
Ms. Zatylny: With respect to security challenges, the ports work very hard to make sure that every single aspect of their operations is as secure as possible. The reality they face is that it’s a rapidly changing environment, so as soon as you have plugged a hole, another one will somehow occur, speaking allegorically.
There are a number of areas when we look at security. One is physical security of the ports, and that is often a question of resources, of just making sure that the port authorities are able to have the sufficient resources and the breadth of the manpower to cover their port lands. That differs from port to port, but certainly in some of the smaller ports, those who are responsible for security within the ports do not have the capacity to either stop or request identification or anything. They have to wait for police to come, and that sometimes creates a bit of a time lag. That creates a problem for them.
I think the other issue relates to cybersecurity, which again the ports are working very hard to stay ahead of the curve on. But the developments around, as I mentioned earlier, blockchain applications, just the movement of data, the increased use of information technology and automated processes to govern the movement of ships and cargo, for example, requires absolute constant vigilance in staying ahead of what everybody else is trying to do, especially around states actors, for example.
Senator Kutcher: How we’re dealing with that, does it affect our global competitiveness? Because ports are hugely competitive, right? Are there things we could do better or more of?
Ms. Zatylny: On the cybersecurity side, no. This is being done with other partners. If it’s done, for example, in the TradeLens application that I mentioned earlier or whether it’s just how the port authorities are working with their shipping partners, that’s a global partnership. That’s the work of supply chain partners around the world to make sure there is no slowdown or there are no hindrances on the cybersecurity side.
Mr. Heney: On the question of diversification of cargo, I have spent the last 15 years with the primary objective to diversify cargo on the seaway. We have had some considerable success. Inbound products is what we’re trying to bring. If we’re an export port, we’re trying to bring ships with cargo all the way to Thunder Bay. We would bring in wind turbines, transformers, pipe made in Germany and structural steel from Luxembourg.
The most repeat shipments are in the nature of structural steel because we don’t make structural steel in Canada. These are for Western Canadian markets. We only have one hinterland, and it’s Alberta, Saskatchewan and Manitoba. Any projects in those provinces, Thunder Bay is now bringing in structural steel for those and railing them to places as far as Edmonton.
We are competing with supply chains in the U.S. for oil equipment to the oil sands through Houston. We compete with American ports on the Great Lakes, such as Duluth, Minnesota, for example. We have proven that we can be a competitive route. We have both railways in the port accessing both the north and south of the western provinces and the best rail clearances for major pieces of equipment of any Western Canadian port.
What we’re finding is even though a lot of the American supply chains through ports are heavily subsidized, that does not always make it down to the shippers’ invoice. We’re still able to compete in spite of the fact of having to pay property taxes or payment in lieu of taxes, which the American ports don’t. So there are a lot of things that are not on a level playing field, but we can still compete. We have to work with all of the supply chains, including rail or truck, to the final destination, not only the port, in order to get this route sold to the customer, but it can be done.
Senator Doyle: My questions have been asked so I don’t have a whole lot. The Arctic Ocean is getting more and more navigable. I’ll leave a note for Senator Oh; I guess it’s because of climate change.
Do we have proper port facilities on our Arctic coast? I know Goose Bay in Labrador has a port facility. Is it in a position to serve the Arctic, for instance?
Mr. Heney: I can’t really speak extensively for the Arctic. Many people confuse Thunder Bay with being an Arctic port but we’re actually not. I do know from experience there are very few workable ports in the Arctic, very little infrastructure. Most of it was built around the distant early warning system back in the Cold War days.
In terms of Canadian ports, there are very few. I would say the infrastructure is very light in the Arctic for the needs. Many of the ships are unloaded with the tides and the cargo is brought by smaller vessels into the port at low tide, so there are not a lot of dock facilities in these ports.
Senator Doyle: If you had a wish list for port authorities in Canada, what would be a few of the things that you would want the Canadian government to have a close look at for you?
Ms. Zatylny: From the perspective of the port authorities, as I said earlier, there are about 40 pages of wish list in our submission. I think the high points relate to, first of all, support for infrastructure funding and the follow-on needs around that, both around allowing the financial flexibility to be more creative in how ports access the funding or how they develop their funding proposals, as well as increasing the efficiency in the speed of the Letters Patent amendment processes.
Ports authorities are effectively land managers and to be able to expand, grow and keep operating, they need to be able to manage their lands. That’s done through the appendices to the letters patent. Currently, the process to amend them is extremely opaque. It takes several years to process even the most non-controversial changes, like a change in address of port headquarters, for example. This often leads to either delays or increased costs of a port authority who is trying to get their hands on a piece of land. So that would be, I think, one bucket.
The other bucket relates to what I was saying earlier on the recognition of this expanded role of port authorities as they are moving into becoming more logistics managers and business developers — loosening up the constraints around the Canada Marine Act, as we described, to allow port authorities to either develop or invest in non-wholly owned subsidiaries, that sort of thing, to really open up their ability to grow businesses around them.
[Translation]
Senator Dagenais: I thank our guests. As I am a Montrealer, I will talk to you about the Port of Montreal, which is doing fairly well. We know that the Port of Montreal cannot currently develop. I think there is a project at Contrecœur, and I hope you will not come across any impediments, as, every time the authorities want to expand the port, there are groups opposed to the expansion for one reason or another.
How much of a role can the Port of Montreal play in the growth of our trade in terms of agricultural products? Can projections be made for the next five or 10 years?
Ms. Zatylny: Senator, I cannot discuss projections for the Port of Montreal in terms of the increase in its shipping activities. I know that the port is surely very important in Canada’s national transportation system, and every port, including those of Vancouver and Halifax, is currently looking into the possibility of increasing the cargo volume it can handle. We should keep in mind that ports like those of Halifax or Montreal are competing with U.S. ports. They must work tirelessly to be as competitive as possible. That has the same impact on cargo or agricultural products as on other products that go through the port.
In the Port of Montreal, we have noted an increase in the volume of agricultural products passing through following the free trade agreement concluded with the European Union, CETA. The port is certainly preparing for that growth.
Senator Dagenais: You talked about development issues, I think, concerning port logistics. Where does the obstacle come from? In your presentation, you talked about an obstacle to development. Do you have concrete examples of what you could do to improve development and logistics in ports, to increase their efficiency and ensure that they are more competitive with American ports?
I have an example. I often pass through Baltimore. I don’t know whether the port is subsidized by the city of Baltimore, but it is pretty big. That said, would the development of logistics help you expand ports and overcome the obstacles to port expansion?
Ms. Zatylny: If I may, I will answer in English.
[English]
In terms of the ability to really expand on the logistics side of port handling or port capability, as I said, it really comes down to the definition of port authorities within the Canada Marine Act and the restriction on remaining within the realm of shipping and navigation. It prevents them from expanding into non-port uses on their lands. Given that in some cases some of the lands are not close to the port or the usage around the lands has shifted, ports can better make use of that land, make better investment and get greater revenues, but they’re prohibited from doing so. That’s one example.
A second example that relates to supply chain efficiencies is where ports are bounded physically or geographically, they’re looking to develop logistics handling facilities that are not contiguous to port lands and presently are not able to do so. Prince Rupert is a great example of that, where they are trying to establish a container-handling facility away from the port so they can improve their fluidity. As I said, at the moment, they are not able to do so. That’s why we’re recommending the changes within the Canada Marine Act to allow ports to be able to do that.
Senator C. Deacon: That got to a whole lot of my questions on that side, because I’ve come from the startup sector, and I was sort of thinking you have to be able to hack a solution here to get around some of these limitations while you’re waiting for the act to get updated. It sounds as if you’ve found some of those ways, but there are some where it just can’t happen. You’ve really helped me a lot.
I was interested in the Warburtons example that you provided as well. I think the value of traceability is probably increasing and is becoming an essential element of the services that you provide.
Can you give me some more examples? I appreciate that you mentioned the value-added around making sure that the traceability is there and there is some cleaning and processing of the grain, but that’s still a very basic level of value-added. I think what we’re trying to get at here is to move to a much higher scale of value-added in Canada. Can you give us some other examples that might go further than the Warburtons example where you’ve been helpful in making sure that a dramatically different level of value is added to an agricultural product in Canada and where close association with a port and working closely with that processor has enabled us to really see something that has increased jobs, wealth and opportunity around an area where we hadn’t necessarily captured that opportunity before? I like the Warburtons example, there is no question. We wanted to see for sure something like that, but we want to see things beyond that.
Mr. Heney: Well, a couple of things come to mind. I think the Warburtons example has been around for quite a few years now.
A newer one is the growing of lentils on the Prairies. So there is a lot of Middle Eastern involvement now. Of course, the Saudis own part of the Wheat Board now, G3 as it’s called, but not just their company; we’ve seen others as well. They’ve gone back to the farmers in the Prairies and educated them in the growing of lentils, which they never did before, and they market the lentils back to their home markets in Algeria and the Middle East. So we’re growing directly on the Prairies things for people to sell in the Middle East.
Senator C. Deacon: It’s customer-driven.
Mr. Heney: Correct, they go right back to the farm and tell them, because you need a lot of farmers to make a difference, so there are changes like that.
The other big Canadian success story is canola. That is a Canadian invention. In Europe, it’s considered genetically modified, but the crushed plants that have been built around that. The canola meal that comes from the crush is sold for cattle feed, and the oil itself is exported all over the world, the meal mostly to the U.S. It’s also the only source of reliable biodiesel for Northern Europe. Canola oil is the only thing that really works. It’s big. It’s up to 20 per cent of what we ship through the port now. It didn’t exist at one point in time.
We’re seeing a diversity of crops now. We used to be mostly durum wheat, and now we’re seeing things like canola at 20 per cent, and soybeans that weren’t grown before either. Some of this is global warming, I think, but the crop makes the change.
Senator C. Deacon: Where is that processing happening with the canola oil? Pardon me for my ignorance in that regard.
Mr. Heney: There are major crush plants on the Prairies in the West, as well as in Eastern Canada, so we ship canola through to the crush plants. Some are in Quebec.
Senator C. Deacon: You’re taking about the refined product.
Mr. Heney: We’re actually shipping the seed for crushing to crush plants in Quebec and southern Ontario. So there is some movement domestically on the seaway as well. We do move wheat for making into flour in southern Ontario, for instance, as well as U.S. flour mills. So there’s movement within the lakes as well as export directly overseas.
The Chair: Thank you. I have the last question. Mention was made of a national transportation strategy, which I think is excellent. An important part of that is not only the ports but the railways, of course, and the Trans-Canada Highway. Being a Maritimer, I’d like to know what your impression is of product going in and out of the ports to other places in Canada, passing through Nova Scotia and New Brunswick and you get to a point where the Trans-Canada Highway, once you enter Quebec, is not twinned. Has that been a bottleneck in your experience?
Mr. Heney: The Trans-Canada Highway is not twinned in northern Ontario, either. It was actually only completed in 1962. So the port originally shipped packaged freight by ship for loading by boxcar in Thunder Bay up until the 1980s. So this is fairly a new system, the Trans-Canada, in world standards. We try to ship major pieces of equipment west on the highway, and up to Kenora, Ontario, about 300 miles west, is not twinned. It’s a two-lane highway. It does have turnout lanes and passing lanes, but it certainly does not compete with the American infrastructure on the other side of the border. It’s very difficult geography to build through, but probably something to be looked at if you’re looking at the long-term future of the country. It is an issue, though.
Just one more comment on Senator Kutcher’s question on diversifying cargo, which leads to taking traffic off the highway. If we want to diversify cargo down to general products, consumer goods, we need to fix the cost structure, and the biggest single item on that list is pilotage. There’s a pilot on an ocean ship all the way to Thunder Bay, which is 2,300 miles inland. Most coastal ports have a pilot on them for two to three miles, some maybe 10 miles. The pilots will argue they’re the cheapest pilots in the word per mile, but I’m 2,300 miles inland.
You need to change how that’s charged out. It now costs more than the cost of a ship. The crew, the whole ship is cheaper than the pilot is on the bridge. You also have two captains on the ship where the main captain spent much of his career going to Thunder Bay. So some work needs to be done on streamlining that if you want to diversify and take more business off the highways.
The Chair: I don’t necessarily want to take business off the highways. I’m trying to find out where the bottleneck is and if it impacts you.
Ms. Zatylny, can you comment on that too please?
Ms. Zatylny: I can’t comment specifically on how much cargo is being moved by truck versus rail coming out of the ports in Nova Scotia and New Brunswick. However, what I can say to your point about the highway not being twinned is the reality of any kind of a transportation strategy is also to identify that all of the component pieces along the supply chain, along the transportation chain to ensure and to not only identify the key points and the key gateways but also to then protect the lands for either current development or future development so that when we do have to expand a highway from non-twinned to twinned, for example, we have the capability to do that, that we’ve already laid out that vision and we can start building towards that vision.
For us, that’s the value of doing something like that. We’d fight that battle once, but then we would have an overall vision across the country that would help with exactly the kind of cargo diversification that Tim talked about and reducing the bottlenecks that you referred to.
The Chair: Okay. I’d like to thank the panel for the discussion. It’s been an interesting one.
I’d like to welcome our new panel. From Genome Canada, we have Marc LePage, President and Chief Executive Officer. We also have Cindy Bell, Executive Vice-President, Corporate Development. Thank you, folks. It’s great to have you with us today. We have about 40 to 45 minutes, and then we have to vacate this room and get back to the Senate.
Marc LePage, President and Chief Executive Officer, Genome Canada: I will make a little presentation.
[Translation]
Good evening, senators. Thank you for having us. I will make a quick presentation and give a short overview of Genome Canada I will then talk about three concepts that may inform our discussion.
[English]
Dr. Cindy Bell will make a few comments after to correct all the errors that I’ve made in mine.
My name is Marc LePage, President and CEO, and Dr. Bell is the Executive Vice-President. We are here from Genome Canada. We are a non-profit research organization that works closely with Canadian farmers, the agricultural industry, government and research institutions coast to coast to support research projects in a lot of things, including agriculture, agri-food, forestry, all subjects that are very germane to your proceedings.
One of the questions we often get is genomics and genetics, what’s the difference? My simple version — I’m not a geneticist — genetics is one gene, and as human beings we have about 20,000 genes. So when you do genomics, you study the 20,000 at the same time. The implication of that is you have enormous data sets and projects. You can imagine the complexity of all those interacting pieces. You could say that’s genetics on a very large scale.
I’ll give you a quick introduction about where we are in this field relative to the world, and then I’ll go to my three examples.
We were created in 2000, which, you might remember from TIME magazineand things like that, the year of the human genome program. A group of Canadian researchers saw the immense potential of genomics, but in those years we were late to the party. There were some concerns about brain drain. Genome Canada was created. Fast forward, we are now a major world power in this field of research in a number of areas. Those include, as you would imagine, human health, but we are also very active in agriculture, forestry, the oil and gas sector, mining and fisheries — a lot of areas that are very unusual. Canada is probably the only major country that has this kind of integrated platform. About half of what we do is in human health. It starred there, but the other half is in all these other areas.
We fund about 1,800 researchers coast to coast in Canadian universities, so it’s pretty large. Our annual investment in these research projects is about $175 million. Of that amount, $75 million comes from the federal government and $100 million comes from our partners. A lot of it comes from provinces, industry, foundations and international partners. We have a very partnered national program. We often say we’re not a federal program, we’re a national program, with all hands on deck on this one.
We have the genetic blueprint. In these forestry research projects in the commercial sector, we’re looking at improving traits, particularly in plants and animals, that give you higher productivity, yield, growth and flavour. We sometimes work on tomatoes that have flavour as opposed to tomatoes that are just red and tasteless, and things like that.
We’re into the bioeconomy, and we may come back to that, but it’s a bit of a larger concept than just the agri-food sector. If you take the agri-food sector as the biggest piece of it and you add forestry, fisheries and everything biological, all of those systems use genomics or genetics, which is kind of the operating system or software of anything biological. That even includes microbes that are in the soil or water. We’ll keep that concept of the operating software for everything biological.
I’ll move to three examples of areas where there’s a lot of opportunity. We can maybe focus on that after. The first is in the context of climate change adaptation and mitigation. We had some examples previously. We talked about canola, soya and lentils.
In this area, because the pace of climate change is very rapid in Canada, it has some negative and some positive effects. The positive effect is that the line for certain valuable crops, because of the increased heat that we’re getting over time, is growing. It’s very significant for a country that has such a big agricultural footprint. The fact that you can grow it by 10, 20 or 30 per cent because of this added heat or substitute low-value crops for high-value crops is a big a economic engine that we underappreciate.
We almost have a Y2K moment in that all of our plant systems and all of our animals — cows, pigs and chickens — have been bred for yesterday’s climate, and the pace of climate is changing so quickly that they are kind of falling out of sync. Either we upgrade the software and change the genetics — and we know how to do this, but we have to do it on a lot of different species — very quickly so these animals or these plants have natural disease resistance or drought-resistant traits, or we compensate through more usage of water, pesticides or insecticide. And I would say that is a more carbon-intensive and more expensive for agriculture in terms of input.
One example is soya, which your previous speakers mentioned. Because of this heating element, soya, which is already a $5 billion to $6 billion a year export, and for some other high-value crops in southern Ontario, Quebec and Manitoba, the area that is opening up through increased breeding and adaptation to the new climate is perhaps 60 per cent greater than what it is presently for a crop that’s $5 billion or $6 billion plus 60 per cent.
But in Canada, soya is a crop that’s very sensitive to light and heat. The heat is going up but the sun hasn’t moved, so we still have the same amount of sunlight. Most of the soya crops or beans have been bred for U.S. conditions. In Canada, we have to do our Canadian adaptation of soybeans to be able to take full advantage of these new areas opening up with a combination of light and heat and our conditions.
I would say this adaptation in climate change has more upside than downside, but there are things we have to do.
[Translation]
The second example I would like to bring up has to do with the agri-food processing sector. I will use the example of Agropur, which is a large Quebec corporation that is very successful in the dairy sector and produces cheeses. One of the things that company produces is premium cheeses that are fairly complex to make. Given the free trade agreement with Europe, Agropur is trying to increase its production, such as its production of Oka cheese. What leads to cheese processing are microbial cultures that are blended and fairly complex to follow. We have a project with Agropur and Université Laval to properly understand the ideal microbial balance for cheese production and, once the company has mastered that, it will be able to ensure consistent production and quality in the making of its cheeses.
[English]
Those of you from Ontario who eat Balderson cheese, we have a similar project with Parmalat and their cheddar cheese. To get the microbial activity that does the transformation of milk to cheese and get the optimal size and taste, particularly in producing fancy cheeses, you often have loss because something goes wrong with the microbial batch and you have to throw it away and start again. The fancier the cheese, the more that is a problem.
Those are just some examples of what we can do through genetics and genomics.
The third example is a little bit of a stretch. It’s kind of in the area, but it’s the whole area of cannabis. The field of cannabis, now with legalization, it is a plant system. It’s already an enormous economic crop, and is probably one of our top 10 crops already. There are 5 million Canadian users already, though there were some before legalization as well. We have 150 licensed producers and I gather there are about 500 applicants still waiting to get in the production line.
Nobody seems to quite know how many people are employed but I know the two largest companies — which are also the two largest cannabis companies in the world, Canopy Growth and Aurora — will both employ around 4,000 people by the end of the year. As a job generator, an economic engine and a sector that can self-fund, I’ve never seen anything like it. It’s more accelerated than even the Internet.
It’s an interesting area. There are issues of public health and harm reduction. Given how big this industry is, it’s a plant that’s young in its characterization. We know almost nothing about cannabis — it’s kind of a weed — in terms of optimizing it for growth. If we’re going to have real medicinal products with protected intellectual property, we have to have a level of knowledge that we don’t have right now.
I think it’s a great opportunity. We have a great regulatory system and with that, particularly on the medicinal side, we’ll be able to conquer markets in Germany and the U.K. backed up with this fantastic regulatory system. Even tools for the regulators will be an important element.
I will finish by saying we are peer reviewing a bunch of projects. We’ve been doing this for over a year. By June, we’ll be announcing 8 or 10 new projects in the agri-food sector. We’ll be investing $60 million to $80 million. It’s a big investment in this sector and it’s really good news. I want to mention to this committee that we’ve partnered with Agriculture Canada. That department is funding their scientists to work in collaboration with university scientists, so it’s kind of a Team Canada approach. Historically, you can name your field but we have all kinds of problems having university scientists and government scientists working together. They tend to be parallel tracks so I want to take the opportunity to thank Agriculture Canada, who have helped us a lot on this.
If I may indulge the committee, I will ask Cindy to say a word or two about biodiversity and ethics.
The Chair: Could you make it really short? I know it’s really interesting but we have to be out of here fairly shortly and people want to ask questions.
Cindy Bell, Executive Vice-President, Corporate Development, Genome Canada: Thank you very much. This is related to our ability to adapt our crops to climate change. One of the most important tools that allows any organism to be able to adapt is its genetic diversity. Most of our crops, which we have domesticated for hundreds of years, have lost a lot of their genetic diversity through the process we’ve used to domesticate them. These are traits they’ve lost and will probably need to adapt to this changing environment they will be facing due to climate change. We need to learn how to use that to our advantage, as Marc said.
Therefore, we are co-leading an international project called DivSeek. That project is the sequencing the seeds of the wild relatives of our domesticated crops that are stored in seed banks around the world, and unleashing that diversity and bringing back the knowledge of traits that we may need to use to breed back into our crops — to do what Marc has talked about with soybeans, lentils and other crops that need certain traits to be able to adapt to climate change.
The Chair: Thank you. We have a number of senators to ask questions. Senators, come with your best one question, and if we get to a second round, we’ll give you a second one.
[Translation]
Senator Maltais: Ms. Bell and Mr. LePage, welcome. My question is very short. Is Genome Canada interested in the application of pesticides and fertilizers to soil? Do you have a clear position on that issue?
Mr. LePage: We don’t have a clear position on this kind of an issue, but we are responding to it. We are doing a lot of work on species with natural immunity, and our goal is to reduce the use of fertilizers and pesticides in order to have a healthier agriculture. That is sort of where our involvement is manifesting.
Senator Maltais: Thank you very much.
[English]
Senator Doyle: If I understand you correctly, you do a lot of work with the agricultural industry in terms of crop development via genetics. Am I right in assuming that there’s still a great deal of opposition to using gene technology in the agri-food sector?
Mr. LePage: Yes, regarding the issue of GMO at the consumer level, the answer is “yes.” We’re fortunate in the sense that we’re not bringing foreign genes into a species. We’re looking within the diversity of the species. For example, we work on wheat. We look within the normal variety. There’s a lot of genetic variety even within the culture, so we look for the traits that are already there and breed to those traits.
In your area, we do a lot of work on salmon as well for cultivated salmon.
Senator Doyle: Salmon feed.
Mr. LePage: Salmon feed, salmon genetics, the feed that goes into the salmon and the interaction of those two elements. You are looking for genes that are in salmon and that have an effect that you desire, say antibiotic resistance, and breed to get that more concentrated.
But the issue of GMOs does exist at the consumer level, of course.
[Translation]
Senator Miville-Dechêne: Mr. LePage, you intrigued me with your cheese story. So I will ask a question about what your are doing when it comes to Agropur cheeses.
Pardon my ignorance, but I would like you to explain to me a bit better what you can do. We know there are different free trade agreements in place, in particular the free trade agreement with Europe. Is it because Agropur is facing stronger competition that you want Oka cheese to taste like something, as it has lost a lot of flavour over the years? In short, is there a connection between what you are doing, international competition and the fact that our cheeses have to be better?
Mr. LePage: There may be a connection. I may not be the best person to confirm it, but I think that what Agropur has seen is an opportunity to increase the sales of that cheese with a distinctive taste in export markets. The problem comes from the fact that microbial activity and milk culturing further complicate the production of Oka cheese. With our colleagues from Université Laval, we are trying to understand what types of microbes and what quantities lead to ideal and the most flavourful cheese to be able to produce it in large quantities.
Once the people from Agropur have that information, they can get organized to produce a quality cheese you may develop a taste for. I was under the impression that the export potential was high.
Senator Miville-Dechêne: That’s pretty good news in itself, since we are interested in dairy products and their impact on free trade agreements.
Mr. LePage: Yes.
Senator Miville-Dechêne: So, if there is a will to move toward international markets with better cheeses, that’s good news.
Mr. LePage: I think that is the case. This product has potential. The problem had to do with moving from small quasi-homemade production to a volume of production capable of supporting a much larger market.
Senator Miville-Dechêne: Thank you, Mr. Lepage.
[English]
Senator C. Deacon: I think everyone knows I’m the head of the fan club of Genome Canada. I have been for a long time. Thanks for a great summary.
We’ve been managing genetic traits in agriculture for hundreds of years. What’s happening now, it seems, is that we’re learning to speed up that process, and we need to for a lot of reasons. One of the quotes that I’ve learned from Evan Fraser from Guelph, I think, is that we need to produce more food in the next 40 years than the previous 10,000. We have a lot of work in front of us.
One of the ways — you spoke about it with cannabis — is the amount of private money coming in. That can’t ever be replaced. If you want to scale something, you need to unlock private investment opportunities. I’m most interested in your advice to us around what has worked at Genome Canada to unlock that commercial potential, where you’ve got a great idea and now it’s starting to scale with accelerated success. We can’t just protect IP; we have to exploit that IP. We can’t discover it or protect it; we need to exploit it.
What are the business models and the advice you would give to us to make sure we’re really understanding what needs to be done to make sure these opportunities create opportunities, wealth and jobs in Canada? It’s not just discoveries in Canada, which we’ve been really good at. We’ve got to stop giving them away.
Mr. LePage: Yes. In terms of a system and where the government intervenes in an innovation system. To use my Agropur example, Agropur is a $7 or $8-billion-a-year company, but genomics to them is a foreign thing, and there’s no internal capacity. It was important to partner with them on this first project so they can understand. Once it works, we’re not going to be co-funding the project; they’re going to take it and scale it.
As research agencies — and I think we need the encouragement of policy — we ought to be at the risk side of new innovations and stabilize the first experience. I’ll use another example. We have a project with Enbridge. Oil and gas — who would have thought. It’s on corrosion. Genomics and Enbridge don’t travel together usually, but it looks like we can pick up corrosion through microbial activity better than through visual inspection. That is an example of where, once Enbridge has sorted out and stabilized the impact of this, they will staff up.
The positioning to risk — that first transfer — you have to have basic research, then a kind of a transfer and then a hand-off.
Senator C. Deacon: To clarify what I think I just heard, if the problem is well identified and you have a partner who values solving that problem, that’s a critical element of the success you’re creating.
Mr. LePage: Yes.
Senator C. Deacon: Then you can bring the science to bear, and you are working with somebody who already has the capacity to scale.
Mr. LePage: Yes. Particularly in biology, which is slower-moving than, say, the Internet, it’s a longer process. You want your partners to define at the front end what the problem is. Then there’s a middle stage where you work together on solving the problem. Then they’re more active. Then in the third part, they run with it.
Senator C. Deacon: That’s really good advice to us. Thank you very much.
The Chair: Very practical.
[Translation]
Senator Dagenais: I must say that I am a compulsive cheese eater, to the dismay of my wife who tirelessly repeats to me that it is not healthful in the quantities I consume. Eating a wheel per week may be too much, especially since we also eat some in the Senate. I don’t want to contradict my colleague regarding Oka cheese, which I have liked a lot, but I have thrown myself into Bonaparte from Saint-Raymond de Portneuf, which is excellent.
With all the agreements we have signed, including CETA and the Agreement for Trans-Pacific Partnership, and with upcoming ones, such as the Canada-U.S.-Mexico Agreement, our cheeses and dairy products will move around, if I may put it that way. I would like to hear your thoughts on the sustainability and safety of food products that will be available on the market. Are you worried about that? Trade is growing, and we must ensure that our cheeses are safe and most importantly sustainable. What are your thoughts on that?
Mr. LePage: Those are all aspects we may be interested in. We are somewhat dependent on our researchers in various areas, as they are the ones who develop ideas. We have funded and continue to fund projects on food traceability. We have developed inspection tools for the Canadian Food Inspection Agency to control product quality. Maybe Cindy has something to add?
[English]
Ms. Bell: You gave some great examples. We have a number of technology development projects that are working on point-of-care technology to be able to determine E. coli, Listeria, et cetera, in our food products. A few of those projects we’ve done in partnership with CFIA.
[Translation]
Mr. LePage: Conversely, we have developed inspection tools for meat producers. We have had problems with E. coli and the Listeria bacterium in certain meat plants, so we have developed tools to enable producers to quickly detect an issue, on site, instead of waiting for three or four days, when the distribution is already done and products must be removed from the shelves. Tools are being created for both inspectors and producers, so that they can take action more quickly, which limits the severity of issues when they arise.
Senator Dagenais: I’m happy to hear you talk about meat because, last year, we visited the Maple Leaf plant, which was experiencing problems. We were able to see the precautions Maple Leaf now takes. I can tell you that, during our visit, we were extremely well protected. We wore gloves, boots, and they practically washed us before letting us in. I assume you have had to look into the microbiology that has affected Canadian meat plants?
Mr. LePage: Yes. When an issue arises, it gives us a good opportunity to find a solution.
Senator Dagenais: Thank you very much.
[English]
Senator Kutcher: Excellent. We would expect nothing less.
Scientific advances are essential for unlocking the commercial potential of foods, but we also have to pay attention to the market. What, if anything, is Genome Canada doing to address the increasing consumer hesitancy around genetically diversified foods, educational things, activities that counter misinformation and disinformation?
Mr. LePage: Yes.
Senator Kutcher: What has been the success of those interventions?
Ms. Bell: I’ll start by saying that for every project we fund, they have to have an integrated research project within them that looks at the societal implications of the research that they’re doing. They look at consumer acceptance and ethical issues, a variety of issues. They then inform the researcher whether or not there is going to be a market or acceptance of their product.
That’s one of things we’ve been doing since the very beginning, because we feel it’s important that all of the research we fund must be used responsibly.
In regard to the new technology such as gene editing, in particular, we have regional genome centres across the country that we partner with. They are sort of provincial versions of Genome Canada. They have done a lot of work in their communities through educational and outreach programs, having a forum on new technology such as gene editing, looking at the issues of GMOs.
What other topics?
Mr. LePage: Those are the big ones, and regulatory issues, regulatory burdens of one kind or other.
Senator Kutcher: My guess is that most Canadians think CRISPR is a type of bacon.
Ms. Bell: Yes. We are certainly involved at an international level with all of the activity that is going on so that we are informed.
Senator Kutcher: I’m concerned because I am seeing an increasing hesitancy for consumers to use wonderful genetically diverse foods because of the misinformation around them. I wonder if that could be a role that Genome Canada could take.
Mr. LePage: We sometimes will present conflicting views based on science, and then people can make up their minds but from an informed point of view. I haven’t met a geneticist yet who seems to be worried about GMOs, but people have issues.
Even though we fund research with people working on GMOs — we have no objection — most people don’t because there’s so much advantage to be had within the natural diversity of a plant that it’s almost overtaken.
Senator Kutcher: That’s exactly why I was asking the question. I don’t think Canadians will understand the difference.
Mr. LePage: No. That’s where we meet the problem. People say, “You are working on GMOs.” Well, actually, we’re not. Maybe we could, but generally, we’re not. People confuse those two things, yes.
Senator Moodie: I’m a pediatrician, and I meet all the parents who worry that all of these modifications are actually causing increased allergies, antibiotic resistance and more serious illnesses — you pick whichever flavour you want.
I hear you talking about the fact that within the projects you have the work being done. Are there any types of structured methodologies that you use to bring it to the forefront, to the general public? It sounds like you hand it off to the researcher, and the company gets it, but then how are we deliberately bringing it to the public?
It’s a broader issue. It’s not just about food. It’s about vaccines and a number of other areas in which people are questioning science and are increasingly concerned about it and mistrusting what they’re hearing.
As a particular industry that does this important work, what is your contribution to trying to undo some of that mistrust?
Mr. LePage: I would offer that even though there are problems with trust, scientists in Canada — maybe not in every country — are still held in high regard. Often the people we fund are thought leaders. In a way, we’re happy to have them lead the discussion, because they have an authoritative voice, and people pay attention to them. I would say that is our primary intervention. We encourage them, as part of their obligations — they’re funded by the big programs — to engage with the public. It could be a specialized public or the public at large, depending on what they’re working on.
As Cindy has indicated, our genome centres do public outreach campaigns, so science literacy, gene school, K to 12 schools. There is an enormous appetite in those age groups for anything to do with DNA and biology. We can’t keep up with the demand.
Communication is not our primary mission. We do as much as we can.
The Chair: We have two senators on the second round. We have only about five minutes in total, so one question each, please.
[Translation]
Senator Maltais: I will take a bit more time, as I would like to come back to a specific issue raised earlier by Senator Doyle.
You talked about your involvement in agriculture, be it in terms of grain or meat. What about aquaculture?
Mr. LePage: We are very active in that area. I did not talk about it a lot, for lack of time, but we have worked a lot on salmon and are working on trout. We have been working on three or four species. We continue to work on fish genetics as such, usually to find fish that is in better health and has natural resistance that helps reduce the use of antibiotics, which is a problem in aquaculture.
We are also working on animal feed that often has nearly the effect of a vaccine and helps increase animals’ natural immunity if it is well organized.
Senator Maltais: How can the feeding of fish be monitored? I think that is where the problem lies.
Mr. LePage: It is sort of like the dynamics of animals, be it beef, pork or chicken. Producers themselves have an interest in maximizing the reduction of those extras, as those are additional costs that often have consequences. We are working on both the feed and the genetics of species.
Senator Maltais: I am asking the question because it is important. I had a disastrous campaign six or seven years ago concerning a type of fish imported from Thailand. I went to see what those fish were eating. When I saw what they were eating, I understood that, if Canadians continued to consume that fish, they would all die. However, I could not get it banned.
I visited an aquaculture company in Ontario where that fish is raised in a very safe manner, with clean food across the board. That company is struggling to compete with businesses that raise that fish on food that contains antibiotics.
I don’t think we can afford to import that fish into Canada. Is there a way to identify it when it is imported and to ask what the fish has been fed and whether it is harmful to consumers?
[English]
Ms. Bell: Potentially through a technique called bar coding which was developed in Canada at the University of Guelph. It’s being used very broadly. It’s being used at our ports in Canada to identify if there is contamination. For instance, somebody says it is a certain type of fish and it really isn’t, they can take a small sample and sequence it really quickly. Just by reading a small piece of DNA, they can tell you whether it’s contaminated with something or whether it is really what they say it is. This technology is used quite extensively all around the world now. It is called DNA bar coding.
[Translation]
Senator Maltais: Thank you.
[English]
Senator C. Deacon: Thank you very much to both of you for being here. You have a great program that levers a federal government dollar with provincial government dollars with industry dollars. There is a good bang for the buck there, and it’s done in a way that we just heard earlier is solving an industry problem so you have a partner that is scaling the technology out of the shoot.
You’ve learned a lot about an area that we’re not good at in Canada which is working with academics and liaison officers to make sure there is impact in our communities from the research we do in our labs. I would love to see every VP of research in Canada be named VP research and community impact. If I had my way, there is a whole lot of things I would change.
Can you give us your best advice over the last 19 years as to what we need to recommend as a committee where we can help to see more value-added benefit in our economy out of the great research in our labs? I know that’s not going to necessarily match the couple of minutes we have left.
Mr. LePage: In terms of science policy, I would like to see us encourage the whole spectrum, so rather than say do fundamental science and applied science, take a subject area and do the whole spectrum. Both are important, not one or the other. You do the whole continuum and encourage and name your science area, drive it that way. I think that’s been one of our successes. Occasionally we struggle with the centre of gravity shifts to fundamental science or centre applied science. In equilibrium is ideal for me.
Ms. Bell: Whether we are funding discovery or applied research, we always need to have line of sight to application.
Senator C. Deacon: And that application needs to be driven by a problem identified by the user. That’s what I think I’m hearing. You’re reinforcing the same point. Really stay focused on that. Thank you very much.
Senator Oh: Talking about the bar code that you mentioned, I went to a seafood exhibition show in China, and Canadian freshwater fish from different lakes are coming with a bar code and they can tell which lake it’s coming from in case there is contamination. Canadian food is safe.
The Chair: Thank you, senator. Panel, it has been great. We could have gone on for a lot longer.
One quick announcement. I want to remind senators, we have a regular meeting on Thursday morning at 8 o’clock, plus we have a special meeting Monday morning from 9 o’clock until 10 o’clock. It is a one-hour meeting. We will be hearing from Dominic Barton by video. Be here, and don’t be surprised when the clerk sends that notice for the special meeting on Monday morning for one hour.
(The committee adjourned.)