Perspectives on Canadian Pork

From time to time BuyFromTheFarm.ca receives emails with articles that site members think should be posted. We received a link to an article that appeared in the Welland Tribune entitled “Declining Behavior” by James MacInnis.

The sender drew our attention to the following: ... This past week Malcolm Allen, NDP member for Welland, challenged the Conservative government by insisting Canadian hog farmers do not need government loans that burden them with debt, they need subsidies to ensure their survival and the sovereignty of our food supply. When asked, "what hog farmers are supposed to do facing bankruptcy and the loss of their farms," the federal agricultural minister responded with this flippant response: "the market will take care of farmers." ... Read the whole article.

I contacted the M.P’s involved in the exchange and was only able to get a response from Malcolm Allen, NDP member for Welland. I explained that I was trying to get more information about the exchange for our site and wanted to make sure I was not getting anything out of context. His office forwarded a copy of the exchanges in parliament on buying local and farm support.

In the first, Mr. Allen is speaking to Bill C-29, An Act to increase the availability of agriculture loans and to repeal the Farm Improvement Loans Act.

Buying local

Malcolm Allen, MP Welland- We talk about how we could help farmers. We talk to them about buying local. A couple of things happen when we buy local. Quite often we do it at the farmers' market, but we do not see any support for the farmers' markets across the country. Even though the Canadian Federation of Agriculture has asked for that support, it has not seen it yet. This would be one way to ensure our local producers could get to the farmers' market so they could make some additional money and become, hopefully, viable from a financial perspective.

However, the other side of it is the national grocery chains. Quite often there is no place for local products. There is no placement on the shelf, as they call it in the trade. Because of the numbers of outsourced products, the quantities they can bring in and the way they can control them, they get pride of place. Even though local producers have that ability to produce the quantities, we still do not get pride of place. Sometimes we do not get any place at all. It depends sometimes on the local market itself or whether the local supermarket wants to do it.

-- Hansard 2009/5/11

Agri-stability

Mr. Malcolm Allen: Mr. Chair, I will move to agri-stability. The minister may have answered this before. The 2009 budget states:

The Government will also work with interested provinces toward devolution of delivery of the AgriStability program to support improved client service through wider integration and alignment with other business risk-management programs already delivered provincially. Integrated provincial program delivery would help ensure that the suite of programs meets producers' needs.

Saskatchewan producers are saying that there seems to be a negative margin and negative margins do not work with agri-stability. That formula does not work for them. Is the government going to do something to address the agri-stability formula program? They are in a negative balance all the time. The program is not going to look at that except to say no, which means they are not really going to get out of debt.

If it is only going to be loans and they are already in debt, and all we are asking them is to take on more debt, do we have a plan to get them out of debt?

Hon. Gerry Ritz: Mr. Chair, a properly working market will get them out of debt.

The member opposite is mixing several situations. He talked about devolution. We are in discussions with Saskatchewan and B.C. I firmly believe that closer to the need is the best delivery mechanism, so I fully support that devolution. We are working toward that. It has been slowed down a little in B.C. because of the election, but now we will get back on track.

The member opposite should also know that the delivery of agri-stability is a joint responsibility between the federal government and provincial and territorial governments. We have discussions by conference calls. I had one last week with my colleagues. We are having another one in July which will assess the first year of agri-stability. We will talk about what works and what does not work. We will have those numbers.

Because of the large acreage and the tremendous amount of agriculture in Saskatchewan, it is always one of the large beneficiaries of any program, including agri-stability. We have the numbers as to the payments that have gone to Saskatchewan and I can get them for the member.

In situations where there are negative margins and situations where farmers have multiple years that are keeping them out of triggering a payment, we make an advance payment to them. That goes against future payments that we think may come to them. They have that cash flow to keep them liquid and they will be paid back as they trigger payments in the future. That is the best of all worlds in the situation the member opposite is talking about.

Mr. Malcolm Allen: Mr. Chair, it is interesting to hear the minister say that the markets will get them out of debt.

I do not have as many cattle producers or hog producers in my neck of the woods as members out west do, but nearly all of them are saying the same thing. They are not making any money at this. They are all losing money, yet the response is always that the market will get them out of it. So far the market has not done them any good. We have expanded markets and they just keep losing more money.

Hog producers were in the Senate courtyard recently. The president of the Ontario Pork Producers told me that he does not need another loan. He needs money.

The minister said there may be challenges at the WTO. The WTO is not going to save our hog farmers if we just—

The Chair: Order. I am going to have to cut off the hon. member to allow the minister a few seconds for a very brief response.

Hon. Gerry Ritz: Mr. Chair, it is always dangerous to make a blanket statement that everybody is in trouble. That is not the case. There is a growing number of livestock producers who are actually seeing some light at the end of the tunnel. I know that is a well-worn cliché, but it is absolutely true.

There are some problems in the hog sector. We continue to work with that sector and with the provinces and territories to come up with a program that will not be challenged, that will serve their best interests, and continue to open those markets for them.

-- Supplementary Estimates, Thursday, May 14, 2009

I have posted these exchanges so people can read what was actually said. As mentioned in another article on this site, Canada and U.S. Re-affirm Support for Pork Industry, Minister Ritz is working very hard to support Canadian hog farmers and to find a solution which will not be challenged by the WTO. However, Mr Allen’s point is that the 'properly working market' referred to by Minister Ritz is not here yet, and the cost to Canadian agriculture, and the families involved, may have catastrophic effects. It is too bad that the Chair interrupted Mr. Allen before he had a chance to make his point.

The average Canadian may not understand the ins and outs of the World Trade Organization, but one truth should be self-apparent: as Canadians we must protect our local sources of food. Minister Ritz is quite correct that a long term sustainable solution is required. WTO challenges to perceived tariffs and subsidies will only worsen the situation. Mr. Allen is also quite correct that an immediate solution is required. Canadian farmers will not survive while they are in the tunnel, whether they can see the light at the end or not.

One option would be to remove the many barriers that exist for local marketing of produce. For example, within the meat packing industry food safety concerns have recently led to consumer paranoia. While we used to depend on inspection of product, and a results-oriented food safety system, we have moved to a system of required equipment and procedures. Yes, larger operations, with large staffs and continuous processing, will require stringent quality control, and equipment that can be cleaned efficiently. We forget that small operations are not run continuously, the owners take pride in the cleanliness of their equipment, the quality and safety of their product, and the equipment has been upgraded as it becomes obsolete. Most food safety issues involve large plants, not the smaller operations. Yet the new regulations do not distinguish, and are putting local butchers out of business. Small butcher shops cannot afford the massive and unnecessary upgrades. We also have a shortage of inspectors for abattoirs, and many are operating only one or two days a week. Abattoirs cannot stay in business, and farmers in many cases have to transport animals an unreasonable distance. The cost, which must be passed on to the consumer, puts their product out of competition in local markets.

We continue to put up barriers. In Ontario, the Clean Water Act and the Nutrient Management Act are both in response to the incident at Walkerton. Both acts are ill conceived, unnecessary, and damaging to farms and local food processors. Both acts were rushed through to make political points The electorate never had an opportunity to understand that Walkerton happened because of an inspection problem!

We need to promote the local consumption of local production. Simply throwing money at a local marketing campaigns is not enough. We must address basic issues which have eroded a healthy supply system to its present state of dysfunction. Repeal knee-jerk legislation, provide adequate inspection, and either remove financial barriers or subsidize necessary upgrades for existing businesses, or new entries in required industries. We must open new, and stabilize existing, international markets for our produce. It is not a question of a domestic or a international focus. Canada needs a balanced approach which incorporates both.

A half century ago we destroyed a thriving cheese export industry with milk quotas. You would think we would have learned our lesson. A ‘properly working market’ begins at home.

A word of thanks goes to Malcolm Allen, NDP member for Welland and his office staff for their patience and understanding providing this information. Malcolm Allen is the NDP Deputy Agriculture Critic and may be contacted through his website.