Welcome, everyone, to our committee meeting this morning, as we continue our study on advancements in technology and research in the agriculture industry that can support Canadian exports.
Before we start, I certainly want to welcome Mr. Shipley, and also Mr. Terry Duguid, who is replacing Eva. We're certainly wishing her mom all the best. I know she had some health issues.
This morning we have with us Mr. Andrew Casey, president and chief executive officer of BIOTECanada. Welcome, Mr. Casey.
We will also be hearing, via video conference, Mr. Simon Dugré, who is the director of the Centre d'innovation sociale en agriculture.
Good morning and welcome, Mr. Dugré.
Can you hear me?
Thank you, Mr. Chair.
Thank you to the committee for this fantastic opportunity to testify on this very important subject. I understand this is your last hearing. Hopefully we can help out at the very last day and get you on the road with some great suggestions.
I thought I might start by introducing BIOTECanada, not because I think we as an organization are particularly interesting but I want to focus on our membership. We have 250 member companies. They are across the country and they occupy a number of important baskets or buckets.
We have a large health care component. That's the area where you would see large multinational pharmaceutical companies, but also a lot of small companies that are developing new drugs, medicines and therapies to keep people healthy. We also have in our membership industrial, agricultural and environmental biotech companies. They are also right across the country, usually in clusters spread out in the different provinces. Each province focuses or has a specialty. The companies are usually around universities or research institutes, as you would expect.
What are they doing? They're doing biotechnology, which is essentially taking living organisms and turning them into useful things. The earliest form of biotechnology are things that are near and dear to most of our hearts—beer, wine and bread—but we've come a long way since then. They are developing biotechnology solutions for the world, and I think the key here is to understand what the challenge is that they're addressing.
When you look at the world we see a global population growth. We expect to be somewhere in the nine billion person area probably within the next 30 to 40 years, maybe even more, maybe 10 billion. That brings with it some enormous challenges, not the least of which is how we feed all of those people on a landmass that is shifting on us, in the sense that some land is becoming less available and some land is becoming more available. Part of the reason for that is the climate is changing.
Why is the climate changing? We know that with the global population growth along comes a massive economic growth, particularly in countries like China and India, where you see those economies really taking stride and ramping up. With that economic growth comes the burgeoning middle class, which spends more money and demands more consumer goods, and that proliferates the economic growth.
That kind of economic growth puts enormous pressure on the planet as well, as factories manufacture more goods and more people waste. We have to find ways to address those challenges. We cannot keep living the way we have. We have to change fundamentally how we manufacture, how we grow, how we live our lives. Ultimately, the planet is going to be just fine, as the dinosaurs can attest. It is us that are in danger. We have to find a way to save ourselves and biotechnology is the solution that's going to help get us there. That seems like a daunting challenge and, of course, it is and we must address it.
It's also an enormous economic opportunity for a country like Canada. In the agricultural space, when you look at our history, we are in a really fantastic space to bring forward amazing solutions for this global challenge. We have a lot of companies in this country that are building on that history of innovation and also our agricultural heritage and developing some fantastic solutions.
I'm going to use two to illustrate the point because I think it's the most effective way. One is a company called Agrisoma. Agrisoma takes a genetically modified mustard seed or a version of a mustard seed. That seed can be grown anywhere you cannot grow other plants. You can grow it in fallow fields. You can grow it in places where there's not enough nutrients in the soil, where there's not enough sunlight, not enough moisture, so that spreads out exactly where you can put this thing.
Once you've grown the seed, the seed is crushed and you extract the oil. The oil is processed into jet fuel. There is no fossil fuel in the mix. The jet fuel can go straight into a jet engine and the plane will fly. There's the NRC plane. Many of you as you've gone out to the Ottawa airport have seen there's a little hangar off to the right as you pull into the airport. There's a little jet in there and there's also a sniffer plane. They've flown the jet with the fuel. You don't have to alter the jet engine in any way. They send a sniffer plane behind it and because there's no fossil fuel in the mix there are no emissions.
It's a fantastic story that gets even better. If I go back to that seed I told you about, once you crush it there is meal that's left over afterwards. That meal then gets put back into the food chain. It's used for protein to feed cattle and other animals.
It's a wonderful life cycle. You use the whole product. It's put into fields, and so farmers, if they have a field in fallow, can use it to put nutrients back into the soil while growing the seed, and it provides an income. Obviously, from a transportation and from an environmental standpoint there's a fantastic benefit, and then it goes back into the food chain. That's a great example I think, but as you hear that story you can start to understand all the different parts of government that have oversight from a regulatory standpoint.
You have transport, environment, agriculture, and at the very end you have Health Canada through the Canadian Food Inspection Agency, which takes care of the genetically modified meal that's going back into the food chain.
The other example I'm going to leave you with is a company called Okanagan Specialty Fruits, out in the Okanagan Valley. It figured out a way to stop apples from turning brown. I'm the father of a 12-year-old and I would like him to eat apples, but he won't take any apples to school because the minute they're cut at home, they turn brown. Kids don't eat them. You can't put them in fruit salads at school, and sometimes you can't give them to kids because they don't want to eat brown apples. Thousands if not millions of pounds of apples are basically discarded every year because they get bruised and turn brown. This is a way to stop food waste.
Like you, when I first heard this story I wondered if this was really all about just stopping an apple from going brown. I got the idea that this may not be the ultimate goal, and it's not. If you look at that company, the other thing these scientists and orchardists discovered is a way to stop something called “fire blight”. Fire blight is a fungus that will rip through an entire orchard and destroy it if not controlled. Using the same sort of technology, they have figured out how to stop that, and that's what they're working on. It's a step change. You develop certain things and you improve on what you've already discovered and use that for further discovery.
When we think back to the challenge we're facing as a civilization in having to deal with the global population and the need to be more efficient and effective in how we grow, manufacture and live our lives, these are the types of solutions that are going to help us get there. We have a fantastic history of doing it through innovation in our agricultural departments. We also have a great amount of support from government. As you've probably heard, there are a number of programs that have been enormously supportive. The most recent large one is the protein industries supercluster, which is going to develop a lot of fantastic innovation out of the Prairies. It's a great development. It's an exciting industry, and it's a great opportunity for Canada to be at the forefront and be a leader in solving some of these problems.
I will leave it at that, Mr. Chair. I thank you very much and look forward to the questions.
It's a great pleasure for me to take part in this morning's meeting from Winnipeg.
On behalf of Richardson International Limited, I'm truly grateful for the opportunity to appear before you to address an issue that is both critical and timely in Canadian agriculture, namely advancements of technology and research in the agriculture industry that can support Canadian exports.
To provide context to my comments, I think it's important to provide a bit of background information on Richardson International. Richardson International was founded in 1858, which was 10 years before Confederation, by James Richardson in Kingston, Ontario. The company continues to be privately held by the Richardson family and is headquartered in Winnipeg. It has grown to become Canada's largest grain company with operations spanning from the sale of inputs to producers who are required to grow their crops, to the purchase of those crops for export to over 50 countries around the world, or for further processing in our own canola oil processing and packaging plants and oat processing plants situated in Canada, the United States and the United Kingdom.
This background is important, I think, because we have long been at the forefront of Canadian agriculture and the export of Canadian grains and oilseeds, and more recently, processed grains and oilseeds. Our experience has shown us that when it comes to the export of Canadian agricultural commodities, we are operating in an extremely competitive global marketplace.
Unfortunately, when we look objectively at that global marketplace we have significant disadvantages to contend with. Our cost of production, in particular labour, is high. Our growing season is short. Our winter climate is harsh. Our production is far from tidewater and the geography required to get there is challenging. We have also, unfortunately, in the recent past had significant rail service failures that have negatively impacted our reputation as reliable suppliers.
How, then, can we possibly compete and succeed given these significant challenges? The answer is the very issue that you are considering: technology and research. Technology has provided, and continues to offer us, the possibility to increase the quantity of grains and oilseeds produced in Canada, thereby reducing the overall cost of production. It offers us the opportunity to improve the quality of grains and oilseeds and to reduce the environmental impact of farming, in particular carbon emissions.
Canada has world-class public and private researchers, and we have producers who embrace new technologies in inputs and agronomic practices. However, this advantage that we have, that we need to be able to compete in the global market, is currently, in our opinion, under very significant threat domestically and internationally.
Our industry is under attack domestically by individuals and groups who want to eliminate the use of certain products, the most recent being glyphosate and neonicotinoids, in Canadian agriculture. They do so by making alarming claims that are not borne out by rigorous scientific analysis as an attempt to disparage the innumerable reports that confirm the safety of these products.
Unfortunately, too few people, including government, speak up against these tactics, and as a result science and the benefits of technology and research in food production are frittering away.
In the case of a recently announced eventual ban on neonicotinoids, we see a regulator, the PMRA, Pest Management Regulatory Agency, changing its approach to product registration, we believe, as a direct result of this pressure. Let us be clear. This is not an attack limited to glyphosate and neonicotinoids. It is an attack on technology, science and modern agriculture.
While government's failure to actively promote and support the safety of these products and technologies is problematic, things get significantly worse when provincial and municipal governments jump on the anti-technology bandwagon by adopting measures such as cosmetic pesticide bans, which, again, are not supported by scientific fact. You may ask what cosmetic pesticide bans have to do with Canadian exports of grain and oilseeds. The connection is actually quite direct and leads to my second point: the international attack on Canadian grain and oilseed exports.
It is obvious that we are currently in a phase of global trade protectionism. While the most obvious trade barriers are typically monetary tariffs imposed on imports, in agriculture, equally effective if not better barriers are the non-tariff trade barriers, which often manifest themselves through phytosanitary regulations or technology approval processes.
For example, countries will use their domestic regulations to limit the quantities of pesticide residues—known as maximum residue levels or MRLs—on Canadian crops to impossibly low levels as a means of preventing the entry of Canadian crops, usually at times when the importing country has a domestic production surplus.
Canada's ability to challenge the legitimacy of these measures on the basis that they are unreasonable and not backed by sound science is completely eviscerated when, on a domestic level, we have regulations that prohibit the use of these products on lawns on which we walk. How could we say on the international front that regulatory decisions must be science-based when we fail to do so domestically?
I opened my remarks by saying that the issue of advancements of technology and research in the agriculture industry that can support Canadian exports is a critical and timely issue. We are truly at a tipping point. We need to decide, from a policy and strategic perspective, where we stand on the development and application of technology and research in agriculture. We are currently, in our opinion, veering down a dangerous path where we say that we support technology and research in agriculture, but then fail to stand up to their domestic and international opponents and, more significantly, adopt regulations that run contrary to the primacy of scientific basis. Without a clear and conscious decision on where we stand, the current and future advantage that Canada has in the fields of technology and research in agriculture will inevitably be lost.
As a result and in closing, rather than considering the advancements of technology and research in agriculture that can support Canadian exports, I urge you to consider the issue through a somewhat different lens, namely the support required for advancements of technology and research in Canadian agricultural exports.
Thank you very much for your time and attention.
I thank you once again for the opportunity to take part in this meeting.
First, I would like to thank the Standing Committee on Agriculture and Agri-Food for this unique opportunity to introduce the work of the centres collégiaux de transfert de technologie, the CCTTs, the college centres for technology transfer, of which the Centre d'innovation sociale en agriculture, or CISA, is a part.
Forty years ago in Quebec, research at the college level was just beginning. Today there are more than 59 college centres for technology transfer located throughout Quebec. Our mission is to support industry in its innovation efforts in order to help it develop and be more profitable. The partners involved must contribute effectively to the complementarity of this mission.
CISA is linked to the Cégep de Victoriaville, which is located in the Centre-du-Québec region, a rich agricultural area. I would say it accounts for about about 15% of Quebec's production. We are funded by the Ministry of Education and Higher Education, since in Quebec, the CEGEPS are the first level of higher education. We also receive some core funding from the Ministry of Economy, Science and Innovation.
CISA is a young centre; its status was recognized in 2009. That year, Quebec and even Canada were getting over a crisis in the pork sector. In the Centre-du-Québec, several producers had been affected by the consequences of the crisis. At the psychological level, producers were dealing with fatigue, and the suicide rate among them was alarming. Social innovation allowed us to design innovative solutions.
What is social innovation, and what is our definition of it? It consists of any idea, approach, intervention, service, product, law or organization that provides an appropriate and sustainable response to a social, economic or environmental need. I'm talking here about a solution that has been adopted and provides a community with measurable advantages. It is a systemic solution with a transformative scope. It's a methodology that supports innovation. In our opinion, when people work with technological and social innovation right from the outset to develop programs and meet the needs of enterprises, those innovations allow the enterprises to acquire work methods that are much more productive, commercially. That is in fact one of our first recommendations.
According to Grand Challenges Canada, the joint work of organizations that specialize in social innovation, together with technological enterprises and commercialization firms, is likely to allow innovations to have a worldwide reach and viability, if, at the outset, organizations are developed in parallel with appropriate social and commercial innovations. In this regard, a good example is the iPhone. That is exactly what happened there, several years ago. At the social level, people are now even studying the impact of the iPhone on human beings.
I'll give you a concrete example. We are currently developing a self-driving, electrical weeder in co-operation with another CCTT, l'Institut du véhicule innovant, which is associated with the Saint-Jérôme CEGEP, as well as with the ELMEC company, from around Shawinigan, which specializes in the design and manufacture of electrical charging stations. The CEO of that company loves the Tesla model, and decided to ask a CCTT with a technological vocation to work with him in developing an innovative solution. We were contacted and we got together with this business as well as with that college centre for technology transfer in order to determine, with them, the social and technological needs of the agricultural producers, who will be using this technology in the near future.
Our project was funded in part by a small Ministry of Education and Higher Education program whose objective is to support transfer and social innovation. We received about $100,000 for a project that represents, in total, more than $3.5 million in the context of federal government technological programs. I'm referring here to NSERC and anything involving the CFI in connection with infrastructure.
Our work has now taken this project to the prototype phase. The Centre d'innovation sociale en agriculture is now an industrial partner, together with the Victoriaville CEGEP, in testing this product at the pre-commercial level on the land close to our research infrastructures. Consequently, we hope to see a strengthening of technological innovation capability through the contribution and joint efforts of social innovation from the very outset of the creative process.
I'd like to add a few brief words about the Cégep de Victoriaville. For 25 years, this CEGEP has been providing training to agricultural producers in the areas of traditional agriculture and organic farming. We have developed an organic farming diploma, with a new three-year technical program leading to a DCS in agriculture.
I'd simply like to add that the joint presence of research and college-level training has allowed us to attract a large number of students to our college. About 15 years ago, the Cégep de Victoriaville had about 15 students in its agriculture program. Now we expect to have 250 students by 2021. The federal and provincial governments provided $20 million in funding for our infrastructures, which were delivered this year.
Despite this, we still have some important challenges to meet regarding the functioning of these devices and infrastructure. We are constantly looking for funding from our partners, be they at the municipal, federal or provincial level. It's important to fund training to properly meet the short and medium-term needs of enterprises. We would like to see the federal and provincial governments make that one of their priorities.
We would like you to note the importance of supporting the Institut national d'agriculture biologique of the Cégep de Victoriaville, as well as other infrastructure needs in Quebec.
In closing, I would like to mention labour. In my opening remarks, I spoke about the psychological needs of producers. I'd also like to address the well-being of Quebec producers and processors. Currently, market pressures—
I want to thank our three witnesses very much for being here, either via video conference or in person.
Mr. Dugré, I want to say good morning to you. We live quite close to one another. I'm happy you are here with us, and pleased to discover that agriculture in the Québec region is doing so well, particularly at the Cégep de Victoriaville.
Today's topic is at the very core of our study. It's a topic we probably should have addressed a bit earlier. There are two competing trends.
Mr. Casey, you said in the beginning that the population, and demand, were growing. The answer lies in technology, but the trend is for people to reject technology. It doesn't make sense.
How did this conflict develop? What caused the gap? Why do people no longer trust technology, Mr. Casey?
I'll answer you in English, so that I can be more precise.
That's entirely correct. These are fantastic innovations. They are based in science. They are moving very rapidly.
Generally speaking, people are always hesitant about new things that seem incomprehensible. In our case, we're talking about biologics and using biology to change structures of different things. I think the key to that is to ensure that our science and our regulatory system is as stringent and strong as possible. In this industry's case, I see it as a competitive advantage for our industry because Canada is world renowned for its regulatory capacity. It struggles sometimes to keep up with the pace of change, but it is well known around the world as one of the leading jurisdictions from a regulatory standpoint. If our regulations are based in science and are science-driven, then I think we stand a very good chance of changing minds. Over time, people will understand.
As an example, I know that the sun is bad for my skin. I know that if I put sunblock on my skin it protects me against the sun. Is it possible that in 10 years a study will come out that says sunblock causes a cancer of some sort? Absolutely. What I do know now is that it protects me from the sun. That's what the science tells us.
It's the same thing when you're talking about genetically modified foods or any other type of produce. Science tells us that it's absolutely safe. It's been consumed for hundreds if not thousands of years. When we're talking about food that is genetically modified, we're essentially doing a more surgical version of what we've done naturally over hundreds of years. If you look at corn from a thousand years ago, you'll see that it looks like a little grain of wheat. It does not look like the corn we have today, but over time, we were able to selectively breed and grow the kind of corn we have now. Now we're doing the selective breeding in a much more refined and specific way, which provides you with something more quickly, and it's based in science.
Thank you very much, Mr. Chair.
I thank all of the witnesses for their superb presentations.
This is the last day of our study. Throughout our various meetings, I realized that research and development plays a large role in the development of technological innovation. We saw that R and D is often focused on production. People want to produce more, and faster. We may want to replace human beings, and that's fine. There are a lot of improvements in that regard.
However, how can we see to it that this R and D happens upstream from production? In Canada, we have an extraordinary competitive advantage: we have knowledge, experts, space, and high-quality products. Explain to me how all the actors could cooperate so that more R and D happens upstream.
Let's start with Mr. Casey, and then I'd like Mr. Dugré and Mr. Ruest to answer as well.
You are quite right: it's a big challenge.
It's one of the biggest challenges of the industry. We're great at innovation. We have great science that comes out of our universities. We have these fantastic ideas. Then, what do they do? They go. They go to other countries for a number of reasons. I'm going to give two that I think are the most important.
One is, if you want to create a company in Canada, you need investment. It's expensive, the timelines are extraordinarily long, and the outcomes are not certain, so you require special kinds of investors. You have to have a very patient investor who's willing to come here and willing to sit through the long process. In medical therapies, you're going through clinical trials, and the timelines are not that much different when you're talking about some of the technologies that we're trying to advance. Therefore, you require a very special investor.
You also require people. As Mr. Dugré was talking about, the schools are creating those people right now. One of the key things we have to try to do is to develop leadership, leaders, CEOs for these companies because they're a unique kind of company, not just a person who can step into some of those large organizations and run an existing operation. We're talking about somebody who has to take something from the ground and build it up, go out and attract those investors.
Where government can play a role here is on the public policy side, because investment is like a global tourist. It's roaming around the world looking for places to go. Canada has to look at itself like a hotel. If you stay at a hotel, you know that they always put out little things such as chocolates on the pillow, free Wi-Fi, free breakfast, nice sheets, or whatever it is. They're trying to attract you as a tourist. Canada has to do likewise to attract investors and to keep people here. We have to put our own chocolates on the pillow.
One of the chocolates on the pillow for investors is how we do tax and how we do regulatory policy. Those are the types of things that provide investors with the assurance that when they invest in these companies, it's going to be here, it's going to grow, and it's going to be successful. That's what we need to do as an economy.
What we don't have right now is a national bioeconomy strategy that links all of this together, something that takes all these different threads and makes a whole cloth. That is one of the most important things that could be done, because as you've heard from my examples, each one of those companies is regulated by about four or five different departments, yet they're not all connected. We have to find a way to identify this sector, the importance of it, the great innovations that are coming out that you highlight, but how do we take them so we can create companies that are going to be based here in Canada?
A huge thing the government could do would be to develop a national strategy that would identify those objectives and bring public policy to that purpose.
Absolutely, it's a common refrain we've heard from some of our companies.
From both examples I gave you, whether it's the mustard seed into jet fuel or the non-browning apple, both of those companies went through long regulatory processes that they felt were probably too long. In fact, the apple one received FDA approval in the U.S. long before it was received here in Canada.
Can it be better? Absolutely it can.
The only point I would make, though, is that the brand that we have is not just the maple leaf. It is the fact that we do good science and we do have a really good regulatory policy. That's what is recognized. We would never want to lose that, because I do believe that is a competitive advantage. Can it be more streamlined? Can it be more efficient? Yes, it can.
From a promotional standpoint, having those out in the trade commissions would be useful. Probably more important, though, would be to beef up our regulatory capacity here by adding more scientists who are able to keep pace with the change, because when we're talking about this type of change, it is very rapid, with huge leaps in many cases. Keeping up with that would be extraordinarily important. It would be a very good objective to increase our capacity for handling this, because we're at the tip of the iceberg. We're looking at a lot more innovation coming. It's not like it's going to decrease, and it's a competitive advantage for us to be out there in front of all this. It seems to me from an economic standpoint that it makes great sense to do that.
From a regulatory standpoint, you mentioned the CFIA. In our industry, we have the CFIA, the Canadian Grain Commission and Health Canada that are all regulating at different times and oftentimes, possibly too often, overlapping in their regulation and involvement in the industry. There is great merit in reviewing the mandates of each of those regulators to determine whether we don't have overlap and inefficiencies built into our regulatory system with respect to grain exports.
As well, from a regulatory standpoint, one of the things that is very difficult and hurting Canadian exports of products is what I'll call the lack of collaboration with respect to the registration of new technologies in different jurisdictions. We have a Canadian registration process, and then in order to be able to export to other jurisdictions, we need to go through very long regulatory processes, and oftentimes in countries where we have very similar backgrounds and stakes at play.
The United States is an example of that. To have to go through again a very long regulatory registration process seems inefficient. We ought to be striving for synchronous approval of new technologies in various countries so we can actually deploy them much more quickly than we currently do.
You spoke about the embassies and the role they can play in importing countries. What we need to do, as I pointed out earlier, is to challenge non-tariff trade barriers being raised under the cloak of regulation and sanitary and phytosanitary and technological issues. We have to recognize when in fact it's not a safety issue but a non-tariff trade barrier that's being raised, and be very aggressive in our position that we defend the interests of Canadian exporters. However, as I said, to do so, we have to be on sound, firm ground in our own internal domestic policy, and at times that is questionable.
Certainly transparency is key. Is it up to government only? No, absolutely not. The government plays a very important role once this technology gets to a point where you're ready to put it into the population. Then, yes, you have a regulatory responsibility to take a look at that, and that's really important.
However, ultimately what's going to put everybody's minds at ease is science. It has to be science-based. If you have the testing to show that it's safe and efficacious, just as you do with drugs, it's the same concept with these types of changes. If the science backs it up, that has to give people reassurance. I don't know how else to do it.
If we live our lives in fear of what may happen, I'm not so sure I'm going to drink this water. I could tell you that eating broken glass may make you better. Science tells me that eating broken glass is not good for me, but it might make you better. I don't know. However, you're not going to go out and eat broken glass just because it may make you better.
It's the same thing the other way around. Science tells us that it's all safe. If the science is rigorous and solid, I think we should go with the science.
Thank you very much, and welcome to our guests.
One of the issues, and the main thing we're talking about, is the difference between physical science and political science. A physical scientist is never going to say there's a zero per cent chance, and of course that's when the political scientist jumps in. That is one of the concerns. How do we get this message past our anti-GMO activists or the anti-modern agriculture advocates? We know there are dollars on their side putting pressure on that as well.
Neonicotinoids are certainly an issue. In Alberta, that's exactly what you want to have coating your canola, and that's exactly where you want to have your bees, so that they help in the production, yet we have changes that are completely destroying that technology, which is a great tool.
We have all of this new technology. We have blockchain technology, which we haven't talked about. We have CRISPR technology, which is associated with it. How do we get ahead of that, to make sure the messages we have are going to get through to the general public?
I'll ask Mr. Casey and then perhaps Mr. Ruest.
There are a couple of pieces there that I would like to discuss. One is the opposition, as I'll call it. Instead of the “anti” group, I'll call it the opposition.
I came to BIOTECanada from the forest products industry. That's where I was for eight years, doing policy and trade at the Forest Products Association of Canada. Environmentalists played a huge role in improving the Canadian forest products industry's environmental performance. They're the ones who held the industry's feet to the fire and told them to do better. The industry then figured out it was a competitive advantage to be better from an environmental standpoint. They improved their practices to the point where Canada is one of the leading forest products producers in the world, from an environmental performance standpoint.
I wouldn't want to denigrate the opposition to a point where we don't have it. There is still a very important role to be played there in terms of raising the questions that need to be answered. It ups the game for our regulators as well, such that they have to be as diligent as possible.
It ties to a point that Mr. Ruest made earlier, as well as to my answer to Mr. Breton. It's about this investment piece. If we stick our heads in the sand and say we can't do it because of what may happen.... Other countries are well aware of this economic opportunity and are developing their technologies as well. They're supporting their industries. They have bioeconomy strategies in place to support their industries. That's where the investment will go. It will go to those countries. We will continue to produce oilseeds and grains just as we always have, but we'll miss out on that piece. How do we create companies here? The investment is not going to be here.
Unlike other industries, like forestry, mining, and oil and gas, a lot of this technology that we're talking about is on computers. It could be moved anywhere in the world. If we're not bringing the investment here, that technology will go where the investment is and where the people are. That will be a huge loss, because we'll miss out on the economic benefits of commercializing that here. If we get the regulatory process right and a bioeconomy strategy right, we could be a leader in that space.
Thank you, Mr. Chair and honourable members of the committee, for allowing the Association of Equipment Manufacturers to appear this morning at this committee.
As an introduction, allow me to say a few words about the member companies of the Association of Equipment Manufacturers. AEM represents the manufacturers of equipment that is used in the construction, utilities, mining, forestry and agricultural sectors.
I was speaking with a few of your members, and we've met with members over the years. For example, in the riding of Guelph, our members include Skyjack, with 500 employees; Blount, with 500 employees; and Hitachi, with 150 employees.
I was checking out some websites this morning. I'm glad to note that the honourable member from Vancouver Island was sitting on a member company tractor. We won't name names.
Voices: Oh, oh!
Mr. Howard Mains: Also, the member from Glengarry—Prescott—Russell was standing in front of a milking parlour that I think was made by one of our member companies.
The important thing to note is that the equipment manufacturers manufacture equipment that is used in many sectors, but in particular, today I wish to talk to you about the agricultural sector. I do have a study. It's only in English yet. I can pass it to the clerk later on, but it's only in English. It goes into great detail about the macro issues that are before the sector. Collectively, AEM member companies support around 150,00 jobs in Canada—that's direct employment—and contribute about $44 billion annually to the Canadian economy.
This morning I wish to touch upon three things: first, the importance of trade as an engine of growth for agriculture; second, the innovative achievements of Canadian equipment manufacturers; and third, the challenges facing equipment manufacturers and farmers today in areas such as access to rural broadband.
Technology plays an important role in increasing sustainable measures in agriculture and environmental protection. AEM is supportive of the government's goals announced in budget 2017 to reach $75 billion in agri-food exports annually by 2025. As well, the 2016 advisory council report led by Dominic Barton identified agriculture and agri-food as a sector of great economic growth potential.
At a Canada 2020 event this past June, Dominic Barton shared McKinsey analytics research identifying a number of growth opportunities where agribusiness investment is likely to focus. The four areas of greatest growth opportunity include protein in Asia, functional foods, aquaculture and agricultural equipment. Given these global growth opportunities, agricultural equipment and the agriculture sector as a whole will continue to be key for future Canadian economic growth.
The council recommendations also advised the government to begin developing strategies to clear a path for growth of high-potential sectors like agriculture. In our view, to achieve these goals, the Government of Canada must be committed to setting strategic goals for 2025 for the ministers of ; ; ; ; and . Across departments, well-defined and measured performance targets, such as employment and exports, will be necessary for these goals to become a reality. Indeed, performance measurement is one of the principles of the Canadian government's policy on results directive.
AEM member companies operate and export globally, and I would note that in Guelph, Skyjack, when we were visiting there, exports to 142 countries, I believe. Therefore, international trade and continued regulatory alignment between Canada and the United States continues to be a priority for AEM members. AEM continues to be a strong supporter of NAFTA and is advocating for a modernized agreement in both the United States and Canada.
AEM continues to spearhead industry efforts to discourage tariffs, which harm not only manufacturers but also our customers. It is of vital importance to our industry that farm equipment works seamlessly across the Canadian-American border, and that manufacturers are able to freely export products to other markets.
I will now turn to innovations in equipment manufacturing. Innovative technologies integrated into farm equipment have helped increase agricultural productivity while making the industry more sustainable than ever. Canadian farmers rely on the equipment designed and developed by AEM members for access to clean technologies and innovative tools to reduce greenhouse gas emissions from agricultural production.
Members of this committee will have seen first-hand during their tour of the CNH Saskatoon plant how this investment in innovation makes its way to the shop floor and into equipment. Modern manufacturing processes now allow for the production of equipment that is unique to the individual farmer's needs. As we enter the next phase of farming, which is often referred to as farming 3.0, precision agriculture, big data and artificial intelligence will be critical and revolutionary.
Recently, AEM commissioned a study analyzing the future trends of agriculture over the next 10 to 25 years. The current environment is ripe for digital transformation. Pressures to increase food production will continue to increase, farmers need to adapt to changing clients, and consumers want to know more about their food. It is an exciting time to be in agriculture.
Although it can be difficult to predict exactly what the future of agriculture will look like, we can agree that it will be different from today and certainly different from the time when I was farming 35 years ago.
Good morning. I'd like to thank the standing committee for the opportunity this morning to discuss technology in agriculture that can support Canadian exports—in our case, Saskatchewan exports.
My name is Ray Orb. I am the president of the Saskatchewan Association of Rural Municipalities, known as SARM. Incorporated in 1905, SARM has been the voice of rural Saskatchewan for over 100 years. We represent all 296 rural municipalities in our province. Our RMs cover 53% of the province's land mass. Our smallest rural municipality serves a population of 76, while our largest serves over 8,000. We work on behalf of our member municipalities to help identify solutions to the challenges in rural Saskatchewan.
As an association, we are mandated to work in agriculture, and agriculture is an important sector in our province. Saskatchewan is a key producer of Canada's wheat, oats, flaxseed and barley, and is also home to grain farms, cattle ranches, and dairy production. Our province also boasts a thriving microbrewery industry. According to a recent report by Economic Development Regina, craft beer was a multi-million dollar industry in Saskatchewan in 2017 and is expected to be on the rise, and that's not surprising. Agriculture is a way of life in our province.
Our landscape has changed over the course of the last century. Advancements in technology have created a huge opportunity for farmers, ranchers and rural Saskatchewan, but right now most of rural Saskatchewan does not have the broadband infrastructure to support technology and technology adaptation. Rural broadband is an essential investment that would allow farmers and ranchers to capitalize on technological advances. For our producers looking to compete in the global marketplace, broadband, smart phones and technologies are critical.
We see huge opportunity for technology in the agriculture industry—for example, in precision farming. Precision farming provides diagnostics and sensor technologies that ensure just the right amount of input from water, fertilizer, medicines and crop protection products. This enhances crop quality and animal welfare and improves yields. Precision agriculture better targets inputs and increases yields, and it allows for better planning and decision-making. Without reliable broadband service, it is impossible for producers to use these technologies to their fullest extent.
An additional opportunity for technologies in agriculture exists with GPS capacity and capabilities. GPS-controlled tractor steering and optimized route planning minimize soil erosion and compaction while improving crop yields, but we have yet to see mainstream use of autonomous self-driving tractors. The first hands-free crop has already been grown in a project in the United Kingdom. Also in the U.K., livestock farmers are already benefiting from technology that can help them optimize their cattle's diet and monitor fertility and calving actively, so that both beef and dairy herds will be healthier and more productive. Mortality rates during calving could be reduced by up to 80%.
Again, it comes back to the need for reliable high-speed Internet access in rural areas that would have farmers and ranchers connected to their farms, each other and the globe. If agriculture producers had access to existing agronomic tools tailored to individual farms and fields, it would allow them to get forecasts and agronomic insights to make sustainable decisions and their operations seamless.
Another area important to agriculture and technology is plant science: the study of plant systems. Western Canada has a short, dry growing season, which makes efficient plant growth critical to prairie producers. The University of Saskatchewan's department of plant sciences is the only plant science department in Canada capable of offering such diverse experience in plant studies.
Scientists at the department of plant sciences and the crop development centre conduct research to develop new crop varieties that will thrive under prairie growing conditions. Current innovation studies include the creation of tools that protect crops from insects, weeds and diseases, as well as developing stronger, healthier, and more useful varieties of crops.
The university works with institutions such as the plant biotechnology institute at the National Research Council, the Agriculture and Agri-Food Canada research station, the protein, oil and starch pilot plant, and the Canadian Light Source, all of which allow for interdisciplinary research to support innovation. These types of innovations help farmers to sustainably grow healthy foods both for Canadians and for other countries, which feeds the world and drives economic growth.
It all comes down to good connectivity. Without a reliable, consistent and affordable high-speed Internet connection, these technologies are just not available. In 2016 it was reported that 82% of Canadians had access to broadband. The remaining 18% were largely in rural communities, leaving many producers without reliable access.
As the chair of the rural forum of the Federation of Canadian Municipalities, I note that the FCM has long advocated for increased federal involvement in developing the telecommunications infrastructure that is critical to the vibrancy of Canada's rural communities. Broadband Internet access has become fundamental to modern life and has the power to transform rural Canada. Modern networks contribute to economic growth by improving productivity, providing new services, supporting innovation and improving market access, especially in the agriculture industry.
Thank you, Howard and Ray. It's good to see both of you again.
I want to follow up on where Mr. Orb was leading. In terms of high-speed Internet, we know it's an issue. We're into an agriculture industry where we have a generation of young people who see and are enticed by the incredible opportunities in this industry, not just in the primary production but in the breadth of the industry as a whole.
Mr. Mains, part of what you're talking about is that follow-through, not only on what the farmers use but where our products go and how you handle that in terms of processing equipment.
In terms of the producers who cannot have the high-speed Internet, in my area, which is very heavily agricultural, I have producers in dairy who are spending $30,000 to $40,000 because they can't put the innovation in unless they run cable up, the high-speed cable. In terms of farmers who are in the cash crop industry, what are they to do? That's the other issue. We have this gap in time.
What can the industries do, Mr. Mains, in terms of the production of this high-tech industry we're talking about? How do we close that gap? Any ideas...?
That's right. A great example of that is the precision farming systems with GPS technology that we see in farm equipment today. I'm sure that just about every combine that rolls across the Prairies has GPS systems in it now.
One of the things I try to do is to get out and spend time with farmers. One of the farmers that I did a ride-along with this spring, in his cab as he was planting soybeans, ran a little plot. It was a 100-acre field and he ran this little two-acre plot inside the field where he decreased the seed count by 20%. That was all programmed into the computer.
When you see that technology first-hand, you can see how farmers are taking on that technology and applying it. When he goes through the field this fall to harvest the soybeans, he can see in that little plot that he put in whether the yield dropped by 20% or stayed the same, and he'll see whether or not there was an economic benefit. There are astounding numbers of areas where we see precision agriculture being applied.
There's another example that I really was surprised about. We hosted a field day for the Pest Management Regulatory Agency back in August. We had 40-odd people from the PMRA visit a farm. We had two sprayers and two planters. One of the planters was controlled by an iPad. Instead of a dedicated computer in the cab of the tractor, hitched by wires, for that planter, the farmer was able to control it on an iPad, including the seed rate and the fertilizer rate. I don't think Steve Jobs thought that was ever going to be the case.
Mr. Orb, that's one of my favourite examples of the business that Norbert has developed there around autonomous vehicles. I saw the demonstration a couple of years ago, and I understand this company is moving along.
I want to focus on the role of the municipalities and the three orders of government working together, especially when it comes to broadband. In southwest Ontario, we have the SWIFT project, where the western wardens caucus has put together a not-for-profit that's received $180 million from the federal and provincial governments, $300 million total investment starting next year to cover 350 communities, including first nations, to create 3,000 points of presence.
When you're talking with the other municipal organizations across Canada, are there examples like that out west, or are you following the example in southwestern Ontario?