Welcome to the fall session of our agriculture committee.
I want to welcome everyone back. We have some new people around the table, at least for today.
Mr. Godin, welcome to our committee.
I hope everyone had a chance to relax, but maybe also to visit some farms and markets this summer, as well as to thank a farmer. I hope we all had a chance to do that; we all have that in common.
This morning, we are continuing our work on the advancements of technology
and research in the agricultural industry that can support Canadian exports.
With us this morning, from Colleges and Institutes Canada, we have Mr. Stuart Cullum, president, Olds College. Welcome, Mr. Cullum.
We also have Christine Trauttmansdorff, vice-president, government relations and Canadian partnerships. Welcome, Christine.
On video conference, we have Mr. Tyler Hopson. He might appear very far away, but as soon as he gets to speak it should focus on him. We should be able to, if not hear him, read his lips.
Welcome, Mr. Hopson. Can you hear us today?
Thank you, Mr. Chair, for the invitation to appear this morning.
I am pleased to appear today on behalf of Colleges and Institutes Canada, an extensive network of post-secondary institutions from each province and territory, to which 3,000 urban, rural, remote and northern communities have access.
I am joined on this panel by Mr. Stuart Cullum, the president of Olds College in Alberta. We look forward to hearing from our colleagues from Niagara College later today and from Cégep de Victoriaville on Thursday.
We're going to tell you how our institutions are helping Canada achieve its ambitious goals for growing agriculture exports through advancements in technology and research, and offer recommendations to strengthen these contributions.
The government's innovation and skills plan states, "Innovative products, ideas or services only become real because of the creativity, work ethic and skill of the people who create them.... [W]e will need to build the world’s most skilled, talented, creative and diverse workforce."
Colleges and Institutes Canada could not agree more. We are very conscious of labour shortages in the area, particularly if the market for exports expands as predicted. According to our colleagues at the Canadian Agricultural HR Council, this shortfall is expected to increase to 114,000 jobs by 2025. Filling this gap lies at the heart of the college mandate. Colleges offer over 350 certificate, diploma and degree programs related to agri-food. Over 50% of agriculture graduates are trained in a college or polytechnic institution.
This training is designed to provide the skills learners need to become innovators. No matter what program they're in, students tackle problems from an industry perspective and solve them using the latest equipment and technology. They benefit from their colleges' deep connections to employers, from the guidance of faculty who work in the industry, and from the hands-on experience they get through co-ops, work placements and campus-based enterprises. One of the most effective approaches to experiential learning is applied research, where students work with employers to create prototypes, develop products, implement new technology and improve services and processes.
The benefits of applied research extend far beyond the student. Budget 2018 recognized this, making an important new investment of over $140 million over five years. This will expand the availability of R and D services to SMEs and companies in rural areas, which often have difficulty accessing the innovation ecosystem. It will also allow more students to become agents of technology transfer, ready to take jobs that support innovation and growth and move the results and know-how they've gained through applied research out to new markets.
Our members have more than 215 research centres and 400 labs across the country. Over 40 of these are in the agri-food sector. Last year, they worked with 5,500 companies, 85% of which are SMEs. The industry partner almost always retains the IP, and the majority of projects are completed in under a year.
Stuart and the team from Niagara are going to describe what these facts and figures look like to the students, businesses and communities served by institutions like theirs.
We thank you for the opportunity to meet with you today, and we look forward to your questions and the report on this study.
I'll turn it over to Stuart.
I would like to express my appreciation for the work of this committee. I concur with Ms. Trauttmansdorff that the colleges and institutes in Canada play a key role in support of applied research and innovation, and concurrently in the development and enhancement of the talent needed for our agriculture industry to compete globally.
Olds College has a 104-year-long history of delivering education and training in agriculture. We began as a learning institution and demonstration farm where technology and production practices were tried and exhibited for an industry that needed to become more efficient and productive. Today, a lot has changed, but the need for learning and applied research environments remains key to the success and competitiveness of our industry. Olds College continues to use its 2,000-acre campus and field-to-fork enterprise to support hands-on learning and applied research.
Through the proliferation of technology and big data, and the application of tools such as digital sensors, controls, artificial intelligence and machine learning in the agricultural sector, we believe that our post-secondary environment can be an aggregator of companies, research organizations and other post-secondary institutions for the development, application, integration and demonstration of these technologies. The effects of this collaborative approach will be seen through faster and more effective adoption by our industry and the development of world-class learning environments that deliver the talent needed to ensure our sector's global competitiveness.
A good example of this is found in the work of our Technology Access Centre for Livestock Production, which is focused on meeting the needs of the Canadian livestock industry by providing access to new technologies for increasing production efficiencies, industry sustainability and producer viability.
Funded through NSERC's college and community innovation program, Olds College has been able to work with other key organizations, such as the University of Alberta, where we recently completed a three-year project for improving feed efficiency in purebred Hereford cattle using genomic tools. This project also involved the Canadian Hereford Association, Livestock Gentec, Alberta Agriculture and Forestry, Cattleland Feedyards, and other industry partners. Nearly 1,200 Hereford bulls were phenotypically and genomically tested for feed efficiency in this project, a major undertaking that has built a unique capacity that will allow for the selection of feed-efficient cattle and world-class genetics that are marketable around the globe.
Olds College and our counterparts across the country are building innovation ecosystems that will advance industries and produce world-class talent. This is exemplified in another important initiative that was recently launched at our institution called the Olds College smart farm. In its first iteration of around 100 acres, we collaborated with 15 organizations from the agriculture and technology sector to install monitoring equipment, sensors, weather stations, Wi-Fi connectivity, data visualization and management capabilities. Our smart farm provides a venue where companies, entrepreneurs and producers can develop, demonstrate and integrate technology and practices.
The Olds College smart farm is already attracting a community of global partners and investors for this development, because we are also focusing on system-level issues. It will eventually expand to encompass the whole of the Olds College farm and will provide a unique, cutting-edge learning environment in Canada for post-secondary students and learners around the world to come to.
At Olds College, we know that our impact is greater when we work with others, and we are prepared to lead in aggregating communities around system-level issues and opportunities to enhance and scale our effects.
An example of this is demonstrated in how Olds College led an effort that brought together more than 100 organizations, including 17 post-secondary institutions from across Canada, and $80 million in committed industry investment in support of an agriculture supercluster focused on enhancing economically and environmentally sustainable agriculture and food production through the application and optimization of smart ag tools, technology and science.
While our supercluster bid was not successful, it was shortlisted to the final round, and our collective efforts have spawned other initiatives across the country, such as the recent launch of the Calgary-Olds smart agri-food corridor and the pan-prairie academic working group in collaboration with Protein Industries Canada and the Enterprise Machine Intelligence and Learning Initiative in Manitoba.
Mr. Chair, I believe that Olds College is an example of how colleges and institutes across Canada are developing and leading to support industry and grow talent for enhancing global competitiveness. The challenge that colleges and institutes have is not around demand and performance. Our own applied research activity is expected to double in the next seven years.
What we need—and this is our recommendation to this committee—is a reasonable level of stable funding for the development of our research environments, our engagement with partners and our administrative capacity. The demand is great. However, our capacity is stretched, and we can scale to meet our potential and bring these communities together only if we have what is required in our physical environments and our administration. This is a key need for the colleges and institutes in this country.
Mr. Chair and members of the committee, in closing I want to convey our strong commitment to the work of this committee, the government, our industry, community, and post-secondary partners to leverage the full potential of our institutions to enhance the development and adoption of technology and science for the global competitiveness of Canada's agriculture sector.
I look forward to our discussion. We would be pleased to take your questions.
Thank you for the introduction, Mr. Chairman.
Good morning to the committee members. I appreciate your time and the invitation today.
My name is Tyler Hopson, and I am the public affairs manager for The Mosaic Company. We do appreciate the opportunity to be here today, after an attempt earlier in the year had to be rescheduled.
For those of you who aren't familiar with it, let me tell you a bit about Mosaic and the work we do. Mosaic is the world's largest combined producer and marketer of concentrated potash and phosphate fertilizers, with over 15,000 employees globally, about 2,200 of them in Saskatchewan. Our operations and joint ventures span nine countries. All of our Canadian operations produce potash.
We completed $7.4 billion in global sales in 2017. We have $3 billion in expansion projects under way, including the world's largest potash mine shaft project at our Esterhazy location in east central Saskatchewan.
In less than a decade, Mosaic will have invested more than $6 billion into Canadian expansion. We own assets through the full spectrum of the value chain. We take minerals from raw ore right to the finished product and deliver them to our customers in over 40 different countries.
Canada, as you may know, is the world's largest producer of potash, with over 30% of global supply. Farmers around the globe depend on our products to help nourish crops. They need to grow more food on every acre of farmland.
Mosaic has developed a number of premium products that increase crop yields and combat nutrient deficiency, while using the same amount or less of our products. These products are highly sought after by customers in Asia, South America and across North America.
Our mission as a company is to ensure global food security by helping the world grow the food it needs. The UN estimates that the world population will climb to nine billion by 2050. The world's farmers must produce more food and fuel, and will need more fertilizers to do it. In fact, fertilizers are currently responsible for producing a half of the world's crop yields.
The last several years in particular have been characterized by challenging conditions in agricultural and broader commodities markets. Adding to those challenges are the difficulties we've seen with rail transportation across Canada this year. Potash is Canada's largest mineral export, both by volume and in economic terms, so a reliable, safe rail transport system is absolutely critical to ensuring that exports can not only continue, but continue to grow. As it stands, 95% of Mosaic's potash is exported from Canada each year, almost half of which is shipped to offshore customers through Canpotex, the international marketing agency.
In a challenging economic climate, innovation is more important than ever as an ingredient to success. In recent years, we have conducted more than 1,000 product trials with highly regarded private researchers and universities, as well as customers and growers. Mosaic's innovation pipeline encourages bottom-up idea generation from within our workforce. On an annual basis, Mosaic spends about $11 million on continuous improvement, research and development, and new technology development.
Our Canadian R and D team evaluates ideas and advances the most suitable ones for further development. This process has created several major successes. I have a couple of examples.
Our Aspire premium product combines potash with boron, the world's second most deficient crop nutrient, allowing growers to save energy, time and money by applying both nutrients at once. Aspire has a slower release time, allowing less leaching and runoff. It was created by Mosaic and is now marketed globally and exported from our mine in Colonsay, Saskatchewan.
On the automation side, Mosaic has several automation projects using our in-house engineers and other specialists. These projects are aimed at increasing mining efficiencies, sustainability and safety. Though the automation project is in its pilot stage, we see it as a potential game-changer in the coming years.
Mosaic fully supports the continuation of the scientific research and experimental development, or SR and ED, tax credit for mining, as this program can make a significant impact on Canadian R and D investment decisions. However, we believe there is a need to review the current application process. We have experienced a process that is cumbersome and difficult to navigate. It potentially dissuades Canadian companies from further investment in Canadian R and D. A more efficient, streamlined process would benefit and grow the Canadian economy.
Before I close, I'd like to talk about environmental matters for a brief moment. Recent research conducted by a third party on behalf of Mosaic shows that Canadian potash producers are best in class in terms of greenhouse gas emission intensity around the world. In 2014, Canada's full life-cycle GHG emission intensity for potash was only 29% of the global average, and significantly lower than other major potash regions.
At the same time, we face taxation rates and shipping costs that are far higher than our main competitors', specifically Russia and Belarus, which negatively impacts Canada's competitiveness. We would encourage the government to think holistically when considering agriculture and Canadian exports, and to bear in mind the cumulative impact of current and proposed regulations. Right now, there are several major initiatives under way, including carbon pricing, the impact assessment review and regulations, and the clean fuel standards. These must not be viewed in silos, as the cumulative impacts of federal regulations could discourage global companies from continuing to make investments in innovation for the betterment of both the environment and the economy. In fact, some recent studies show that the rate of investment in Canada has already slowed considerably in the last several years.
We would recommend that the government earmark funding to establish an energy efficiency program that would assist with upfront capital costs for new projects and for retrofits of existing operations. These types of investments would help support mature energy-intensive and trade-exposed sectors such as ours as we work to access remaining emission reduction opportunities and increase competitiveness.
We would be pleased to continue the conversation with you at any time, and I am happy to answer any questions you may have.
I hope that, like us, you had a great summer. We have indeed visited many farms. It was a pleasure to meet farmers all over Quebec and even sometimes elsewhere. I think the challenges are very real for everyone. The summer was a little dry in some areas, and we should spare a thought for those farmers today, since there are many questions about what will happen in the coming days.
Without further delay, I will ask Mr. Hopson a question.
At the end of your presentation, you talked about the carbon tax. I have noticed that, in recent years, Canadian companies have made a major effort to reduce their carbon emissions. I think you mentioned that your company is one of the most effective in reducing greenhouse gas emissions.
Am I mistaken in saying that every time a company like yours invests in Canada, we are concerned about reducing emissions and doing everything we can to ensure that, environmentally speaking, all the current climate change conditions are met?
I'll extend a welcome to all my colleagues. It's good to see everyone again.
I'll start with Colleges and Institutes Canada.
Arguably, the defining issue of the century is going to be climate change and our response to it. We have several paths open to us, which are going to lead to very different outcomes.
I know from a previous study that farmers are often on the front lines of climate change. They are the ones who are probably our best stewards of the land, but they suffer the most from weather patterns that are not the same: droughts, floods and so on.
In the context of our technology and innovation study, and the work going on at your various colleges and institutes across the country, are there any particular spots you can point us to where you're training students on how to adapt and mitigate? Are there any particular technologies you can underline that are going to help us meet this challenge?
Maybe I'll respond to that with a general statement and then a specific example.
In general, the whole college system is designed to be responsive to the current needs of local industry. We do that through deep connections to those industries, particularly through program advisory committees. Twice a year, the people who are putting together the program meet with a group of people who work in the industry, who are employers in the sector, to ask what kind of curriculum they need, what they are looking for in their graduates, how the graduates they sent last year are working out, what their anticipated forthcoming labour market needs are, and, particularly in terms of technology or new demands on the industry, what they need to build in. That characterizes the whole college system.
I'll give you a specific example, coming back to the applied research work that we're talking about in particular today. In New Brunswick, at the Collège communautaire du Nouveau-Brunswick, there is a research project that is helping farmers and producers do environmental assessments on how they can use the soil, the water, the resources, and the fertilizer more efficiently in order to mitigate the environmental footprint, as well as to work more effectively and deal with some of the situations that you are describing in terms of drought and unpredictable weather patterns.
Mr. Hopson, I'll continue along the same vein with you.
I think you very clearly laid out the challenges your industry has. It's a fairly energy-intensive area, but still one of Canada's strongest exports and one of the greatest economic engines we have. I know that our main competitors, Belarus and Russia, certainly don't have the same kind of standards we do. I think this is definitely a conversation that we need to continue having with your industry, on how we can best support it.
I'm interested in hearing something from you. Worldwide, there is a growing consumer consciousness of how our products are developed. Increasingly, people are concerned about how they are developed, and what kind of standards are put into place. Do you think there would be any value to your industry, to worldwide customers, in showing that Canadian potash was developed with certain standards in place and that we, by far, can outrank Russia and Belarus in these areas? Is it worth pursuing that kind of marketing strategy going forward?
That is a good question. I will say more or less the same thing I said in response to one of Mr. MacGregor's questions. What matters is how we train people. What matters is not so much the details they are learning during their studies, but how they learn.
If young people are exposed to problem-solving and challenged to look at problems in an innovative way, to work in the workplace, and to understand how small-business people, farmers, or producers are tackling the problems, their way of learning becomes different. I think that's probably the thing that we need to focus on most—not learning the specifics of a technology but how to think in a creative, innovative way. We're very focused on that.
That said, there is a huge demand to learn about new technologies, so the equipment, the facilities, and the faculty we employ in the colleges are hugely important. At a minimum, we need to be training people on the technology that is present in the industry today—and hopefully we're a step ahead, so that the graduates are importing new ideas, new technology and new skills into the workplace, providing leadership for the existing workforce, and showing them some of the new things that can be done. That requires a constant investment in the infrastructure that post-secondary institutions enjoy. It isn't cheap to keep up with technology, but I think that if we don't do that, we're failing our young people.
This is a key question. It's actually a space that colleges are really well positioned to address.
We have a lot of land at Olds College. When I look at our farm, I see a current-state operation. We want to transition that into the future of agriculture and bring new technology in. We'll only do it through partnerships. We do not have the resources to purchase or acquire that technology. For the smart farm, we had to work with 15 partners, agriculture and technology partners, some multinational, to get the technology in place.
That allows our producers to see where the sector is going. It also allows technology companies to come and develop, scale, and demonstrate their technology, which will ultimately end up in the field three or five or 10 years down the road.
In a couple of weeks, I'll be heading to Australia. I'll be talking to an automation company in Australia, which has a technology that isn't in North America. They're looking at Olds College as a potential place to introduce that technology as a way to demonstrate what they hope will be applied in our agriculture system. For the farmers, that's great, because they need to see technology work before they're willing to invest in it on their own farm.
As an institution, we want to be a support for those companies to introduce it, as well as a support for farmers who are looking to get that technology onto their farms and validated.
Thank you very much, Mr. Chair.
It's certainly great to be back here. I was looking at the picture that Mr. Hopson has there. That would be my riding right now, with the snow.
I'm certainly glad to have everyone here in this discussion. The key thing is, how do we change? How do we make sure that our agricultural industry is ready for our Canadian exports? That's the critical part.
Mr. Hopson, you spoke of some of the concerns and issues we have there. Of course, one of the things the government can do is make sure that our transportation system is working. This is an issue, whether it be grain transportation or commodities, such as the potash that you're trying to move, and of course we see our rail lined up with oil tankers. These are some of the concerns we have, and they really have to be thought about.
I'd like to address my discussion to you, Mr. Cullum. Thank you for being here. Olds College has a hundred years-plus of history, and it has truly been important. It has gone throughout the world, as people who have come to Olds College understand just how important it is.
I'm wondering if in this day of big iron and big data.... I mean, these are the critical things that are taking place right now. Twenty miles from Olds College, you can't complete a cellphone call, but we do know how important it is to be able to get all this information so that all of these data points can be analyzed.
I know that Olds College has the Centre for Innovation. There are a lot of things being done there. I wonder if you can tell us how the smart farm, where we've brought in all of these different companies to help, ties into the other projects, such as your Centre for Innovation.
It's a good question. Ultimately, Olds College has been in the applied research and innovation game for around 20 years, and it's focused on the needs of industry. We really want to ensure that we are developing centres that can be a foundation for industries to come and develop their products, validate the scale and demonstrate them.
It also provides a tremendous learning environment for our students. The smart farm is an extension of that. It's about ensuring that those environments are world class and, as I mentioned, represent the future of where agriculture is going. It really does connect to that.
The point you mentioned about connectivity is really important. The smart farm needed to be developed in such a way that all the critical infrastructure technology was there, including connectivity. It's really cool. If you come to the smart farm, which is a field in the middle of our agricultural lands, you have full Wi-Fi connectivity. That's critically important, because you can create all the data you want within the various devices and monitoring and sensoring equipment, but if you can't connect to the devices, if you can't connect to your smart phone, you can't do anything with it.
Rural connectivity is a key challenge, and it's something we're working on in partnership with many companies. We're developing a great relationship with many of the telecoms in terms of how we can create wireless meshes and ensure that connectivity is enabled, along with the technology that's in the field.
I'd like to thank the Standing Committee on Agriculture and Agri-Food for having us here today. We represent Niagara College, and specifically the Agriculture and Environmental Technologies Innovation Centre. On my right, we have Dr. Michael Duncan, Natural Science and Engineering Research Council of Canada's industrial research chair for precision agriculture and environmental technologies. We also have Sarah Lepp, senior research associate. I'm Gregor MacLean, project manager.
What's great about working at Niagara College is, of course, the fact that we have excellent infrastructure, staff, faculty, students and graduates who support and execute our work. Sarah and I are two of the graduates. What's great is that, despite the fact that we're based in Niagara, in southern Ontario, we work with Canadian companies and have impacts across the country, and our partner companies have impacts across the world.
As a refresher, I think all of you know, but it's important to start by indicating that modern farms are businesses. They need to generate revenue, and with that revenue they also need to make a profit. More and more, to do that in a very competitive commodity market, they need to use the data and technology available to them and, in a lot of cases, that's captured under one banner called precision agriculture, smart agriculture, as Stuart was talking about. That's the area we work within, precision agriculture.
We do three things: We build software, whether that's phone applications, web applications or desktop applications; we work with hardware, moving and automated robotics, drones or UAVs, as well as installed environmental sensors; and we work with data, whether that's processing or analytics, turning all that information into wisdom, information that could help farmers make better decisions in their farm businesses.
Ultimately, we are doing work in three primary crop areas: hazelnuts; grains, which are corn, soybeans, and wheat; as well as vineyards, grapes. Those are not the only things we're willing to work on, but that's what we've been doing for the past number of years. We're willing to expand as well.
I'll just go over a couple of project examples to help folks understand what we can do and the type of work we do. First, one primary collaborator right now is Ferrero. You might recognize them as one of the world's largest confectionary companies. They make the delicious Nutella, the chocolate hazelnut spread, and Ferrero Rocher, the delicious hazelnut chocolates.
As you can imagine, they buy a lot of hazelnuts. They're the world's number one hazelnut buyer, and the bulk of those hazelnuts come from the country of Turkey. You can imagine that, if Turkey has environmental, economic or any sorts of issues, those could affect Ferrero's supply. Well, it's a really great thing that Ferrero also has a plant that employs over 1,000 people in Brantford, Ontario. With that plant's strategic location, they're looking to see 20,000 acres of hazelnuts planted in Ontario in the next 10 years.
We're collaborating to support that work in two ways. There are long-term historic climate and future climate modelling studies that we're building into proprietary software we're creating with our programming team members for Ferrero. They'll provide that to their clients and their potential farmers for a new high-value crop for Ontario farmers that could be worth anywhere from four to ten times the current cash crop revenues. Also, the export opportunity is a new high-value crop, raw, going outside of Canada. More importantly, it's a value-added crop going throughout North America and Australia that comes from Brantford.
The second project I'll discuss is a great example of our working directly with a farmer. At Yellow Gold Farms, Rick Willemse, who is in Parkhill, Ontario, outside of London, farms over 1,000 acres of cash crops: corn, soybeans and wheat. A number of years ago, he created a very innovative precision agriculture variable rate algorithm and process. People wanted to buy it from him to use it. The problem is, he is a very busy person. He's always needed, and he doesn't have the time to do that work. If he provided the spreadsheets, as you can imagine, somebody would steal his secret algorithm. With our data and software expertise, we built that algorithm into web software for him so that he's able to commercialize it as an export software product or as a domestic software product, giving him a diverse income to his farm operation.
The final project I'll discuss is with a company called SoilOptix. They are out of Tavistock, in western Ontario. They offer a proprietary soil health technology. They drive over a field to collect soil health data, and after that's been done, they take seven to eight hours to process the data. Whether the field is 10 acres or 100 acres, it takes seven to eight hours. As you can imagine, that's a bit of a long time.
We've collaborated with them over the past 10 months. We've cut that time down to 30 to 90 minutes, which is 60% to 90%. The high-valued and high-skilled jobs to process that data are still happening in Tavistock, Ontario, not to mention that their hardware and service technology is being exported around the world: China, Argentina, Brazil, the United States, as well as across Canada. We're helping them to scale that technology while maintaining the jobs in Ontario, and we've seen the workforce double in the last year as well.
You see that the work we do helps farm profitability. It helps them be efficient with their resources, including fertilizers, as well as how they spend their dollars and understand the ROI provided based on technology. Ultimately, it has improved sustainability and business practices to help the farmers make better decisions, whether it be about soil or weather impacts.
This work would not be possible without our funders at the federal level, the Natural Sciences and Engineering Research Council, and our excellent contacts Marie and Marion. At the provincial level, there is the Ontario Centres of Excellence and Padraic, Richard and Alexandra. And of course there's Colleges and Institutes Canada, the base funding they support us with and the internship funding.
We are excited to discuss any questions you have, as well as potential future directions we have in moving and automated robotics.
My name is Leanne Fischbuch. I am the executive director of the Alberta Pulse Growers. Farmers elected to our board represent over 6,000 producers of pulse crops in Alberta. These crops include field pea, dry bean, lentil, chickpea, soybean and faba bean.
Our members support our organization through a refundable levy on the cash sale of pulses. The funds are invested in research, market development, extension and communications to increase the profitability of pulse crops for producers, and to increase the knowledge and acceptance of pulse crops by the consumer.
I am pleased to provide comments to you today on the topic of research and development to encourage Canadian exports. In the interest of time, I'd like to focus on a few of the topics, namely trade, policies and programs, and regulatory frameworks.
Alberta has the second largest number of acres and amount of production of pulse crops in Canada. Within the province, field pea is the predominant crop, followed by lentil, faba bean, dry bean, chickpea and soybean, totalling approximately 2.1 million metric tons of production worth $604 million to Alberta producers in the 2017-18 crop year. In 2016, Alberta exported more yellow peas than any other jurisdiction in the world.
Canada does not consume its pulse production. Canada has been the largest exporter of pulses, at 41% of the marketplace for years. This has been a good news story for the Canadian industry, with growers growing more pulse crops and increasing export opportunities.
Currently, however, the industry is experiencing market access challenges with India, which is traditionally our largest importer. Prior to the slowdown in Canada's largest market, in 2017 the Canadian pulse trade had delivered over 7.1 million metric tons of pulses to over 130 markets across the globe. We recognize that other countries are taking a run at our numbers, and we need to work to make sure we can continue to sustainably grow our production and take it to market.
APG's goal is to have pulses included once every four years in each farmer's rotation in Alberta to obtain a three-million-acre production. In addition, we are working with our national organization Pulse Canada to diversify our market opportunities, which includes broadening opportunities for trade of primary products and supporting inclusion of pulse ingredients in pet and human foods, aquaculture and feed in our 25 by 2025 strategy so that growers have markets for their production.
APG supports the efforts to act on “Unleashing the Growth Potential of Key Sectors”—the Barton report—to increase Canadian agricultural exports from fifth place to second place. We see the need to diversify and expand opportunities with our pulse crops.
Discovery, development and marketing of new products take investment. As a grower organization, we use our funds to address questions and capitalize on bringing solutions to our growers. We cannot do this alone. There is a significant need to collaborate with others who are bringing resources such as funding and people to the table.
APG has participated via Pulse Canada in accessing AgriMarketing program funding, and more recently AgriScience cluster funding. APG committed to providing nearly $2.3 million in matching to the $11.1 million in pulse science cluster support from the federal government, which allows our industry to tackle priority research that growers would not be able to fund on their own.
The recent announcement of the success of the Protein Industries Canada supercluster application is also encouraging, and APG is waiting to learn how that funding will be implemented and how we can match our objectives. It's critical to have programs pairing industry investment with public investment and allowing industry to address issues that form a foundation to build upon to meet global and domestic opportunities.
While research addresses problems that are holding the industry back, there are many other areas that impact the ability to grow pulses and reach out to capture export opportunities. There are regulatory challenges that can reduce the potential success of the industry to reach both export and domestic value-added opportunities. These include the following.
First, with respect to transportation, Canada's reputation as a leader in global exports is easily compromised when product is unable to move to market. Systemic rail transportation failure has eroded Canada's brand and trust from international customers of our agricultural commodities. If export opportunities are to be part of the path forward for growth, then transportation needs to be a priority.
Second, the Pest Management Regulatory Agency is challenged with resource shortcomings, such as people and funding, and needs to have its processes reviewed. APG recognizes the importance of the PMRA and its role; however, the agency also has the potential to limit expansion of the pulse industry and significantly affect its future.
Third, it should be a priority for the Canadian Food Inspection Agency to be a global leader in exports, recognition of scientific standards and global harmonization. The codex for maximum residue limits or continued efforts on low-level presence detection can be a challenge with the potential to lead to market access issues. If global export is a key opportunity for expansion, APG would support the CFIA's prioritizing work in this area.
Finally, environment and climate change legislation has an impact on growth and opportunity for the agriculture sector. APG recognizes that farmers who incorporate pulses have a positive influence on the environment, such as reducing the use of synthetic nitrogen and reducing greenhouse gas emissions. Even Agriculture and Agri-food Canada supports pulse crops being added to rotation as part of a beneficial practice to increase carbon in the soil. Farmers are stewards of the land and want to do the best possible management to keep it healthy and viable for future generations. Carbon taxes in a global environment put Canadian exports in an uncompetitive position against others who can supply product at a lower cost due to less regulation. A regulatory impact analysis on the agriculture sector needs to be investigated prior to adopting further legislation.
Canada's agriculture future continues to be export-focused. For the pulse industry, our small national population will never be able to eat its way through Canada's production of pulses. That said, Canadians do need to increase their consumption of this healthy and nutritious product for the many benefits pulses provide. However, export will continue to be the primary objective, with domestic value-added production secondary, in order to consume the tonnage that is being produced.
Alberta's pulse farmers see value in the research supporting innovation and opportunities that will ensure they are able to maximize yield, deal with agronomic issues and produce a consumable product while continuing to keep the health of their land in the best shape possible for the future and supplying an export-ready product to the global marketplace.
Acceleration in trade, continued investment in research, and reduction of obstacles to growth such as regulatory challenges are all part of the path forward.
Thank you for your time. I welcome questions.
Thank you very much, Mr. Chair.
Thank you to the witnesses for being here today.
First, I would like to talk to the Alberta Pulse Growers about some of the issues Leanne brought up. Of course, our main study is on how technology can support those who are going to be exporting our great products around the world. We have the bulk pulses that we are sending, and it looks as though in the future we should be looking at some refined products as well, doing a little bit of that here.
Perhaps you could let us know a bit about how those two are working together. That would be important.
Again, as someone who has produced pulses in the past, peas primarily, I know there are issues, a major one being what has taken place with India, the tariffs that have been put in. The other aspect is the fumigation situation. We understand, as we look at the temperatures that we have in Canada, why the need for fumigation is different from what other countries importing into India would suggest.
Could you give a bit of an update on where the trade issues are, specifically with India, but also with the confusion that is taking place at the moment with worldwide tariffs, and give us a feel for what is happening there?
Thank you, Mr. Dreeshen, for your question.
I'll talk a bit about the first part of your question, on bulk and refined products. When we talk of bulk processing, it's really cleaning the product and then shipping it in large quantities to port and off to the globe. These are the majority of the ways, for example, that peas are moved throughout our system in Canada. For refined products, we would love to see more value-added opportunities created within the Canadian sector. For us, when we look at value-added opportunities, it means fractionation. It means taking the pea, for example, and splitting it into the valuable components, such as protein, starch and fibre.
If we are able to do this type of fractionation eventually, we should be able to attain a higher-value product when we sell into the marketplace. With that type of refined product, if we had the opportunity to attract more companies into the Canadian industry interested in doing this—and it does take money, investment capital and other things, to attract companies—I think we would like to see it.
In Manitoba, we have Roquette coming in—they've broken ground—which is a large processor of fractionated product. We have others that hopefully will be attracted to coming to Canada. My colleague in Saskatchewan is currently in China, and he has had some excellent meetings talking to potential people who are interested in coming and perhaps setting up shop in Canada to do these types of fractionation methods.
For an update on our tariff challenges with our number one importing country, Canadian pulse producers are still subject to tariffs into India. We are under a restriction in terms of the amount of product even going into India. It's a quantitative restriction of 100,000 tonnes of product going in. That has been extended to September 30. At one point—I think it was at the end of August—there was one day when the Indian government lifted the restriction. It caused some excitement in the marketplace, but they immediately closed it down the next day.
The challenge we have with trade with countries like India and how they have treated Canada—and I'm going to say more than Canada, because globally they've inflicted this on many countries they import from—is that they are very unpredictable. This has become a challenge for exporters and farmers.
Initially, in November 2017, when they enacted their tariff on peas, the price dropped for producers by about $2 a bushel. What that equated to for us over the course of the year was an immediate pause for producers to decide what they put into the ground. They dropped their acres this past year. We went from 2.7 million metric tons of production in 2016-17 down to 2.1 million metric tons in 2017-18, and basically took about $300 million away from producers due to that change in access and pricing.
The situation with respect to India now is that we're still under reduced ability to export. We did have an Indian delegation last week with Pulse Canada, and they travelled through Canada to see our supply chain for pulse crops. They visited a farm. They visited a processing facility, and they went out to the port to see the full movement of the product through the marketplace.
While I haven't had an immediate update from Gordon Bacon of Pulse Canada on this, I feel it was really important for the Indian delegation to come out and see how we treat our product, to observe whether we have the problem weeds and things that they consider we have and that's why we would have to fumigate, and then to understand at the ports why we can't—
Thank you very much, Mr. Chair.
Of course I'm very pleased to see my colleagues and all the staff today, and to continue to work together for Canada's agricultural industry.
My thanks to the group of witnesses for being here.
My question is for representatives from both groups.
Ms. Fischbuch and Mr. MacLean, in your presentations, you mentioned how important research and development is in the industry. As we know, the goal was $75 billion in exports in the agricultural industry. Innovation in the agricultural and agri-food sector is an indispensable tool in its growth and development.
Could you please take turns, starting with Mr. Maclean, and tell us how important research and development is?
Could you also tell us how the government could be a better partner and contribute to this vector, which is really important and which gives rise to innovation and new technologies, to improve the competitiveness and productivity of our agricultural producers?
We've done a lot of projects where there's no cost, so we have a kind of pro bono approach. We actually find that the adoption rates are higher when somebody has to pay for something, because they tend to value it more. People who are willing to pay also tend to go deeper into the technology. They're interested in further exploring statistical techniques and different things.
I wouldn't say that the adoption rates of technology are very high right now. There are a lot of farmers who are still doing the blanket fertilizers and blanket coverage, and they don't want IT infrastructure on their farms. They don't want to become IT professionals. As was mentioned in the previous session, there's the thought that we're going to be moving more IT technologists onto farms, but I'm not sure. Each farm is a business and each farmer is the CEO, and whatever philosophy they hold with regard to technology is very hard to overcome. I don't know if money is the thing, or more public infrastructure that they can tap into.
One of the approaches we took very early on was to build cloud-based technology, for the simple reason that it allowed us to project whatever power was necessary, because we can afford the computers and can run them. We have the students who can do the administration, the programming, and all the development of technology that's necessary. Then we can project it right into the farmer's farm, as long as they have a cellphone, a tablet, or a computer of some kind. That eases the adoption of technology by farmers. Because we can provide that service at no expense, it may help them poke around and see what they like doing. We have a crop portal that helps process farm data. We've had it for about three or four years. Is that right?
Thank you very much, Chair.
Mr. MacLean, I think our names are having a competition to see who can be more Scottish. We'll do a draw there.
In your opening comments, you made reference to vineyards as one of the areas Niagara College is looking at.
Where I come from, Vancouver Island, the Cowichan Valley is easily home to most of the vineyards on the island. It's a fantastic value-added industry. We're certainly not on the scale of what you see in the Niagara region or in the Okanagan, but it's still a very important local economy for us. Certainly, I know some are interested in seeing their exports go to other countries, because we do have some fantastic wines.
Can you talk a bit about your research, technology, and innovation in vineyards?
There was a range of products. It was very interesting to see, because for the companies that came to us for this work it was pretty much their first time using pulses and the ingredients that pulses can provide. Some of it was protein, and some of it was fibre. I think the products were really quite successful.
The challenge is that these small companies now have to go out and try to do this on their own. We encouraged them and provided a bit of funding from our growers for this type of project.
Is there a way to have something on the food processing side of things to encourage more of that trial and error in the development of new products? I think that's something that may have been in the FTP Calgary statement, to work on that. I think there is a good opportunity.
Of course, for Alberta it's small companies and medium-sized enterprises that are working on these types of things. A lot of the large companies have the funds to go out and do that.
Another thing that we are waiting to see is the development of the Protein Industries Canada supercluster, because there could be funds there as well. I think it's important to keep an eye on that for more development of value-added products.