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House of Commons Emblem

Standing Committee on Agriculture and Agri-Food


NUMBER 009 
l
1st SESSION 
l
43rd PARLIAMENT 

EVIDENCE

Tuesday, May 12, 2020

[Recorded by Electronic Apparatus]

  (1705)  

[Translation]

[English]

     I call this meeting to order.
     Welcome to meeting number nine of the House of Commons Standing Committee on Agriculture and Agri-Food. Pursuant to the orders of reference of April 11 and April 29, 2020, the committee is meeting for the sole purpose of receiving evidence concerning matters related to the government's response to the COVID-19 pandemic. The order of reference of April 11 also stipulates that only motions requesting scheduling specific witnesses can be considered by the committee and that such motions shall be decided by recorded vote.
    As you know, today's meeting is taking place by video conference and the proceedings will be made available via the House of Commons website. The webcast will always show the person speaking rather than all the committee. To facilitate the work of our interpreters and ensure an orderly meeting, I would like to outline a few rules to follow.
    Interpretation in this video conference will work very much like a regular committee meeting. You have the choice at the bottom of your screen of floor, English or French. When you intervene, please make sure the language channel is set to the language that you intend to speak, not the floor. This ensures the best sound quality possible for our interpreters. This is very important. Also, before speaking ,wait until I recognize you by name. When you are ready to speak, you can click the microphone icon to activate your mike.

[Translation]

    I also want to remind you that all members and witnesses should address their comments through the chair. Members who want to seek the floor when it's not their turn to ask questions should turn on their microphones and raise a point of order. If a member wishes to respond to a point of order raised by another member, they must use the “Raise Hand” feature. By doing so, they'll let the chair know that they wish to speak.
    To do so, please click on “Participant” at the bottom of your screen. When the list appears, you'll see, next to your name, that you can click on “Raise Hand.”
    Speak slowly and clearly and make sure that your microphone is off when you aren't speaking. As you know, we strongly encourage you to use a headset. If your headset has a hanging microphone, make sure that the microphone doesn't rub against your shirt when you're speaking.
    If you encounter technical difficulties, such as problems with hearing the interpretation, or if you're accidentally disconnected, please inform the chair or the clerk immediately and the technical team will try to resolve the issue. Please note that we may need to suspend the meeting at that time to ensure that all members can fully participate.
    I want to ask all participants to click on the top right-hand side of their screen to make sure that they can see everything. That way, you should be able to see all the participants in the grid. This will enable all participants in the video conference to see each other.

[English]

    Finally, just as we usually do in a regular committee meeting, we will suspend between panels or sections of the agenda.
    With that, I will introduce the guest for the first hour, the Minister of Agriculture, Marie-Claude Bibeau.

[Translation]

    Welcome, Minister Bibeau.
    We're proud to have you here. Your schedule is certainly full at this seeding time and given everything else. Thank you for being here today.
    You have 10 to 12 minutes to give your presentation. The floor is yours.

[English]

     I appreciate the opportunity to join you today to discuss our government's ongoing response to the COVID-19 pandemic as it impacts our agriculture and agri-food sectors.
    The COVID-19 crisis has Canadians realizing how important it is to have the wide range of food that our farmers, ranchers, processors and agribusinesses provide. They prove their resilience, innovation and adaptability in the face of these extraordinary circumstances. However, we know there are big challenges and we are taking action.
    As you know, last Tuesday the Prime Minister announced a series of measures to help Canadian farmers and food processors continue their vital work. This amounted to over $252 million, as well as $200 million in added buying capacity for the Canadian Dairy Commission. We also announced important program changes, such as increasing the AgriStability advance payments to 75%, which the Government of Alberta estimated would represent a payment of $20 per head for pork producers.
    The financial measures announced last week build upon a number of other measures we have taken to support our farmers, ranchers, food processors and the entire value chain. We've also put in place measures to help safely welcome temporary foreign workers, up to $50 million, and $20 million towards the Canadian Food Inspection Agency. We deferred $173 million in advance payments program loans for cattle, grains and flowers, and added $5 billion in lending capacity to Farm Credit Canada, which has already resulted in over $4 billion in deferred loans to thousands of producers.

[Translation]

    Of course, in Canada, we already have all the risk management programs. Every year, these programs deliver about $1.6 billion to help producers who are facing financial pressures, as is the case right now. That number is expected to be even greater this year.
    As you know, these programs are cost-shared with the provinces and territories. We know that the risk management programs need improvement. I've been actively working on the programs with my provincial and territorial counterparts. However, the programs are already available and must be used on a priority basis.
    We'll keep improving our programs or creating new ones, depending on the specific needs of each sector of the industry, the gaps and the extra needs caused by COVID-19.
    I'd like to now clarify some of the measures that we've taken so far.
    To encourage producers to enroll in AgriStability, we've extended the application deadline to July 3. Where the provinces have enacted the changes, producers can now access 75% of their expected benefit, up from 50%.
    To help them, we've set up an online calculator for simulation purposes. It's not necessary to have the final financial results for 2019, since a simple estimate is enough to obtain the advance payment.
    There's also the AgriInvest program. This program is a savings account to manage decreased revenues. Producers can obtain an annual $10,000 subsidy if they also contribute $10,000 to their AgriInvest account.
    Currently, the AgriInvest accounts of Canadian producers contain approximately $2.3 billion in accumulated funds.

  (1710)  

[English]

    The Prime Minister also announced two new federal investments under the AgriRecovery program. First, up to $50 million will serve as a set-aside program to help cattle producers cover the extra costs of keeping animals on the farms while they wait longer to be processed.
    I was very happy to see the Province of Alberta announce $17 million towards our federal cattle set-aside initiative, joining their 40% contribution to this cost-shared program, and another $50 million to help pork producers cover costs of managing their surplus animals due to the temporary closure of food processing plants.
    These changes to the AgriRecovery program represent real leadership from the federal government on our business risk management programs. This has been a very urgent request from industry. We have listened and delivered on significant changes on how the AgriRecovery framework operates.
    Recognizing this unprecedented crisis, the federal government will make available its 60% contribution in all provinces or territories, whether they contribute their share or not. Also on AgriRecovery, we are boosting the coverage by the federal government of eligible expenses from 70% to 90%.
    On AgriInsurance, we are asking the provinces and territories to include labour shortages as eligible risks under the program. This would help to ensure income lost by producers because of an insufficient workforce.
     These measures add to the significant work we have been doing to address labour shortages. For example, through the incredibly hard work of the government, in collaboration with leading industry groups, such as F.A.R.M.S. and FERME, we were able to welcome over 11,200 workers in April. That is 86% of the number of workers we were expecting in April 2019.
    Also, last week the Prime Minister announced $3 billion for wage top-ups for low-income workers in essential services, such as agriculture. While Quebec has already announced its wage top-up plan, we look forward to seeing plans from other provinces soon.
    Our food processors are vital to our food supply and our economy. Across Canada, food processing plants have slowed down production or temporarily closed as a result of the impact of COVID-19.
    We understand the health concerns of workers in these plants. Workers need to feel safe and be safe when they go to work. That's why we are also investing $77.5 million in support of food processing, to implement measures to protect the safety of their workers while maintaining production.
    This funding will ensure we can expand our capacity for Canadian-made products, by adapting and reopening plants that have closed or are operating under capacity. This funding is additional to the $62.5 million we announced to help fish and seafood processors.
    We are also working to ensure the safety of workers by removing all tariffs on the importation of personal protective equipment.

  (1715)  

[Translation]

    We're also helping to address the surplus of food across Canada. Farmers, such as potato producers, are facing higher surpluses as a result of the closure of restaurants and establishments in the hospitality industry. We'll invest $50 million in a surplus food purchase fund to distribute the food to organizations such as food banks, which serve the most vulnerable in our communities and in remote and northern regions.
    To help manage the surplus of dairy products, we're proposing to increase the borrowing capacity of the Canadian Dairy Commission, or CDC, from $200 million to $500 million. This additional support will enable the CDC to increase its supplies of dairy products, such as butter and cheese. This measure directly addresses the request of the dairy industry.
    Our government will work with you and all our parliamentary colleagues to implement the legislative changes required for this vital measure.
    In conclusion, Mr. Chair, I want to thank all the committee members for their dedication to the sector. The women and men who work on farms, in processing plants and throughout the food production chain are providing an essential service during this extremely stressful time. We're grateful to them.
    I'm determined to ensure that the sector is well-positioned to continue to serve Canadians and to keep feeding the world. As we begin to restart the economy, we'll build on these measures to help Canada's agriculture and food industry lead our country on the road to recovery and success.
    As the Prime Minister said, we've been and we'll continue to be there for our agriculture and agrifood industry every step of the way.
    Thank you.
    Thank you for your presentation, Minister Bibeau.
    We'll now move on to questions.
    We'll start with you, Mr. Barlow. You have the floor for six minutes.

[English]

    Thank you, Mr. Chair.
     Minister, you say that you have agriculture's back, but the announcements you made last week have been universally panned by the agriculture sector as being woefully short of what is needed.
    To put that in perspective, Dr. Sylvain Charlebois said we are at the real risk of losing 15% of our farms. That is 30,000 farm families that are at risk of bankruptcy.
    Do you have any idea what the ramifications of losing 30,000 farms would be on the security of our food supply and the cost of groceries on the store shelves?
    Mr. Barlow, that is definitely something that I don't want to see. We want to support our farmers in all the sectors, and we have made some additional announcements.
    Once again, we have to keep in mind that the business risk management programs are there. I know producers would like to have these programs be more generous, and we are working with the provinces on this issue. Still, we have made AgriStability easier to access, not more generous but easier to access. It's really worth it. That is why we have put the calculator online, so they can see for themselves that there is money available to them.
    Also, we have increased the advance payments. They can get up to 75%, where the provinces will agree, and I'm confident that most of them will. I've already had a few producers try the system. They recognized that it wasn't exactly what they expected, but it's still significant. They should use this money.
    It's the same with AgriInvest. There is $2.3 billion—

  (1720)  

    Thanks, Minister. I appreciate it, but we only have a certain amount of time.
    We've heard about AgriInvest and AgriStability, but just for your own information, if a farmer were to actually apply for AgriStability—and fewer than 35% actually do—on an average 1,200-acre farm they would get a cheque for $980, which is actually less than the subscription cost to get into AgriStability. There has not been a stakeholder group anywhere in the country that has said what you've announced is sufficient.
    For example, on the $77 million you've announced for the processing, which Mr. Forbes said last week would be available to get Ryding-Regency back up to address processing capacity, we're now learning that those funds might not be available until well into the fall. How is that going to address the bottleneck in processing capacity if those funds won't even be available until well into the fall, or maybe six months away?
     Do you know when those funds will be made available?
    It's a matter of a few weeks. We will make the criteria known very shortly. I was still working on it earlier today. It's almost ready to be shared publicly. We wanted to do some consultations with the stakeholders.
    These funds will have to be disbursed before the fall, so that might be where the confusion came from. These funds are to be utilized before the end of September. They are to meet emergencies and to help the processors put in place the right measures to protect their employees, first, and to continue to operate.
    Earlier this month, your department announced that it is halting all field research in agriculture. Why was that decision made during a pandemic when our grain and oilseed producers rely so heavily on that research and how important it is to the sector? Why have you halted all scientific field research in agriculture?
     Well, I want to reassure you that we intend to start the research work at the pace that other research centres will be able to reopen following the recommendations of the different local and provincial public health departments.
    We've heard from many stakeholders in the agricultural sector that exempting them from the carbon tax would be very helpful during the COVID-19 pandemic to put some more money in their pockets.
    We asked an Order Paper question about the costs of the carbon tax on agriculture and the response that we received from your department was that the information is secret. Why are you withholding the carbon tax data and the cost of the carbon tax to agriculture? Why is that being kept secret? Why will you not share that with producers?
    We have made the verification on that and actually, the analysis has been made public. There was some information directly related to the budget that was secret, but the report is available for the public. After the session, I can make sure that you get the link to the report, if you don't already have it.
    You've also mentioned several times that farmers should be applying for the CEBA program, but most farms—just about every single one we've spoken with—do not qualify for the CEBA because of the salary and the wage eligibility requirement.
    Are you in discussions to expand that eligibility so that farmers can qualify and apply for the CEBA?
    As you noted, the first programs that we put in place were aimed at reaching the greatest number of people and the greatest number of businesses—small, medium and now large businesses. We are following up with the different sectors and trying to fill the gaps. This is a gap that has been identified, but we're still working on it to see how we can support them.

  (1725)  

    Thank you.

[Translation]

    Thank you, Minister Bibeau.

[English]

    Now we have Mr. Blois for six minutes.
    Thank you, Mr. Chair.
    Thank you, Minister, for your time here today.
    Minister, obviously with the announcements that we've made to date, is it fair to suggest that those have been made to try to address some of the concerns that have arisen to date as a result of COVID-19? Is that fair to say?
    Absolutely, yes.
    The Prime Minister has acknowledged that our government is willing to support more. Is that your position as well, as these challenges present themselves?
    Yes, we have put in place some complementary programs to the BRM programs, so I'm really encouraging producers to use as much as they can from the BRM programs. Then we will be in a better position to identify the gaps.
    I want to talk about AgriStability for a moment. Mr. Barlow referenced it, and of course it was his government that cut it from an 85% reference margin, but he talked about certain statistics. I want to confirm them with you.
    AgriStability is currently at a 70% reference margin, which means that if farms were to go beyond that reference margin, that would trigger AgriStability if they're involved, and it would cover up to 70%, which would be almost 50% of the gross farm margins. Is that correct?
    Yes. It's not as simple as that, but yes.
    In theory, though, a farm that might have hundreds of thousands of dollars' worth of income would certainly be entitled to close to 50% if it was enrolled in the program, if it met the threshold. Is that correct?
    I'm looking at my assistant deputy minister because you're calculating, maybe, a bit fast, but it's about 70% of 70% of eligible expenses.
    I want to quickly take you to the carbon tax or the price on pollution, of course. We want to talk about that. Is that something that has come up within the Canadian Federation of Agriculture? Has it been the priority from the agriculture groups in the conversations that you've had?
    No, it's not the main issue that is being brought to me.
    Mr. Barlow continues to ask you about this, but it's not the Department of Agriculture and Agri-Food that normally holds statistics on the price of pollution. Those are held by the either the Department of Finance or the Department of the Environment. Is that correct?
    Yes, that's correct.
    I want to take you to the AgriRecovery program. Each year the Government of Canada generally allocates about $125 million for AgriRecovery. Is that correct?
    Hold on a second. For AgriRecovery, the average of the last five years is about $15 million, and this year we have announced $125 million, which is significantly more important.
    However, the allocation in a budget doesn't mean that that's necessarily spent. It's only incurred if something happens where the government feels it is important to trigger it with the provinces to respond. Is that correct?
     Yes, exactly. The allocated amount was $125 million. It was only utilized at an average of $15 million for the last five years. Now we have already committed the full amount.
    Minister, is it fair to say that on January 1, 2020, you intended to allocate $125 million to a set-aside program for the beef and pork or poultry sectors? Is that something you anticipated coming into the year?
    No. This program is responsive to the provinces' requests.
    No, I didn't think so. Obviously, that money was allocated in the budget, but had you not made the decision to actually expend that money and provide it, it wouldn't have necessarily flowed. Is that correct?
    No. Once again, the average of the last five years was about $15 million.
    The reason, Minister, that I'm asking this is that there's been some suggestion on this committee that, of course, this is not new money. I just wanted to make sure that we hit home the point that these are allocated, but there's a difference between allocation and actually expending the money. Thank you for that clarification.
    Minister, I want to talk about how, obviously, the Canadian Federation of Agriculture is an important stakeholder group. It engages with you. One of its priorities is, of course, supporting our processing sector. We announced $20 million for the CFIA. That was meant to help alleviate some of the bottlenecks. Is that correct?
    Yes.
    In terms of the recruitment of farm workers, we have put some measures in place on the Government of Canada website to try to encourage domestic workers and to work with industry. Is that correct?
    As part of the labour challenges that we're seeing, you mentioned this. Could you repeat it for all of us? Right now there is 86% of the number of temporary foreign workers actually in the country as compared to last year.
    For the month of April.
    Okay, and we introduced $50 million in support programs to help farmers as a result of the additional costs. Is that correct?
    Yes, $1,500 per worker.
    Okay.
    Obviously, liquidity is a big piece of the conversation as well. We know there have been challenging times for farmers. We announced $5 billion for Farm Credit Canada. You said that almost 80% of that is already accumulated, and it's been helping thousands of farmers. Can you elaborate on that?

  (1730)  

    Well, Farm Credit Canada reported to me that more than $4 billion out of the $5 billion of additional money we have given it has been provided to producers so that they can extend, for example, the duration of their loans, push further the payment of their loans. To put it in context, they're not additional loans. It's giving them flexibility and helping them manage their cash flow.
    I want to talk about the Canada emergency business account. We've mentioned that. Mr. Barlow mentioned it. Of course, there are some farmers who don't meet the $20,000 payroll threshold, but many do. Have you heard any examples of farmers taking advantage of that program?
    I want to talk about the business credit availability program, some $65 billion. That's available to farmers as well. Is that correct?
    I want to talk to you about the Canada emergency wage subsidy. Obviously, the Prime Minister has talked about extending that. Presuming that farmers would meet the threshold of normal businesses—
    Sorry, Mr. Blois, we're actually out of time. We're going to have to move to the next questioner.

[Translation]

    Mr. Perron, you have the floor for six minutes.
    Thank you, Mr. Chair.
    I'll be sharing my time with my colleague, Ms. Desbiens.
    Good afternoon, Ms. Bibeau. I hope that you're doing well. I have several questions for you.
    First, do you acknowledge that, because of the COVID-19 crisis, things will be extremely difficult this year for our farmers? Do you acknowledge that they need a great deal of support?
    Yes, absolutely.
     I knew that your answer would be short, and I like that.
    The Canadian Federation of Agriculture was asking for $2.6 billion in emergency funding. You announced $252 million in assistance. I want to be honest with you. Clearly, this amount falls far short of the mark. You also seem to be saying that all these amounts are new money, when this isn't the case. How do you explain this?
    Last Thursday, two days after your announcement, the Canadian Federation of Agriculture, the Union des producteurs agricoles and other agricultural organizations sounded the alarm by saying that the amounts were clearly insufficient.
    What's your response?
    First, the amounts are mainly new money. I'll use the example of AgriStability. The program addresses the provinces' requests when they see that an agricultural sector must deal with exceptional costs. The pre-approved leeway is $125 million. However, on average, $15 million has been used in the past five years. We can consider that, for AgriStability alone, the new money totals $110 million.
    I agree, Ms. Bibeau. However, I want to focus on the basic issue, which is the difference between $206 billion and $252 million. Even if this were only new money, and I'm not convinced that this is the case, isn't that a huge difference, given that the United States announced $19 billion in assistance for its agricultural sector? Our farmers must compete with American producers during the COVID-19 crisis and afterwards as well.
    Aren't we endangering the sustainability of our agriculture to some extent?
    Measures have already been taken and more will follow. However, producers can't simply turn their backs on risk management programs. These programs amount to $1.6 billion a year, and this figure could be much higher. There's some leeway. These programs meet needs.
    Producers must access the money available to them through AgriStability. To make things easier for them, we've extended the deadline for producers to register for AgriStability to July 3. As well, producers are being offered an advance payment worth 75% of the amount to which they're entitled, compared to the usual 50%. This will only be possible in the provinces that have signed on. However, I'm confident that several provinces will do so.
    We've also created an online calculator, because there are many rumours going around about AgriStability. Producers can now go online to do the math, which is much simpler. It's a bit like a mortgage calculator.
    Sorry to interrupt you, Ms. Bibeau. Your calculator does seem very useful. You've mentioned it several times. However, it doesn't increase the amount of money available.
    At the last committee meeting, I asked beef producers for their opinion on the $50 million. They told me that they had already spent it and that it was completely insufficient. The pork producers said that the $50 million that you announced covered about 10% of the hogs in Canada. It's not enough.
    Will you be announcing more funding soon?

  (1735)  

    We'll be implementing these programs very quickly. We're about to announce the eligibility criteria and the process for applying for these programs. This process will be implemented very quickly. If we confirm that this meets a need and that the need is much greater, we'll reconsider the funding.
    The time frame may be very short, if I understand you correctly.
    I'll now give the floor to Ms. Desbiens.
    Thank you for joining us, Ms. Bibeau. I represent the constituency of Beauport—Côte-de-Beaupré—Île d'Orléans—Charlevoix, where many young and up-and-coming farmers live. We're talking about small businesses. I want to hear your comments on the programs that are better suited to these young people.
    Can they expect financial support?
    We must look at Farm Credit Canada, which already provides programs designed specifically for the next generation of farmers. In connection with the COVID-19 crisis, we've created programs, such as the wage subsidy program. We've made some adjustments to help start-ups, for example.

  (1740)  

    However, the wage subsidies are often intended for larger payrolls. Ms. Bibeau, I want to hear your comments on start-ups that don't always have a large enough payroll to obtain the wage subsidy, for example. The criteria are a little difficult for them to meet.
    Are you considering any improvements in this area?
    We're always ready to look at potential improvements. I really care about the next generation and the role of women in the industry.
    Many organic companies are also starting to develop their business in our area. Have you taken measures to better help these companies, which, as we know, are also small businesses?
    As you've seen since the start of the crisis, we're trying to implement programs that cover as many people and businesses as possible. Yesterday, we came to the rescue of small and medium-sized businesses and large businesses. That's how we work. We're always open to the idea of improving programs.
    Thank you, Ms. Bibeau and Ms. Desbiens.

[English]

    Now we have Mr. MacGregor for six minutes.
    Thank you for appearing before the committee, Minister Bibeau.
    In the technical briefing for the bill that your government is introducing this week to amend the Canadian Dairy Commission Act, your officials informed us that 30 million litres of milk had been dumped in late March and early April. Can you give us a quick answer as to what reasons led to that?
    It was because at the beginning of the crisis we had seen a significant.... When all the restaurants and the institutions closed, it brought about a big disruption and diminution in the demand. Obviously, we all know that we cannot stop the milk production overnight. At the same time, they had seen an increase in the demand in the grocery.... I remember that in the first days they increased the level of production for a few days after realizing that the decrease was more important. It took some time for the industry to reorganize their production.
     Thank you, Minister.
    I think it's important that we put the 30 million litres of milk in the context of the market share that's been lost over three successive trade deals.
    I know that the dairy processors and the Dairy Farmers of Canada certainly want to see this measure pass, but I'm wondering if your department has come up with any form of compensation for the dairy farmers not just as a result of CUSMA but also as a result of your government's not honouring the August 1 start of the dairy year?
    We have processed and signed and ratified the agreement in the context of many considerations and many industries, for the good of the Canadian economy. I don't see the relation you are making with the dumping of milk that happened at the beginning of the crisis, which has been resolved thanks to the good work of the Canadian Dairy Commission.
    The point I'm making is that the sector is definitely feeling a pinch right now, but they've also felt pinches from other years. I just wanted to know if you've made any commitment to compensation to the sector for trade deals that your government negotiated with respect to CUSMA. Have you entered into any thoughts on that, yes or no?
    For CUSMA, no, we have not yet done so, but our commitment is strong.
    Thank you.
    Going on to the temporary foreign workers, I know Mr. Blois indicated, as Mr. Forbes testified, that April saw about 86% of last year's number of temporary foreign workers. This is good, given the circumstances. However, we know that many more will be needed, especially as we get closer to harvest season. I think we need to put this into the context of farms that are struggling as to whether they're going to make it through this year.
    How confident are you that we are going to be able to meet full demands for labour when we get to the really busy season later this summer?

  (1745)  

    I'm quite confident, based on the results of the month of April and seeing the exceptional work that the Department of Citizenship and Immigration is doing with the support of Global Affairs Canada. They have put the processes for all the visas and the permits that they need to have on a fast track. It leaves me very positive in terms of getting a good number of temporary foreign workers.
    Do you have a specific number? Has the department made any projections on the number you think you'll be able to have in place in the next few months?
    No, I don't have numbers.
    Okay.
    In our previous meeting, we had the Canadian Cattlemen's Association appear before the committee. As you know very well, they are suffering because of the processing plants. They have been very centralized and they've been hit by COVID-19. Our thoughts are of course with the workers and the workers' safety, but we have a real problem coming up on the horizon. I'm glad to see there's a set-aside program, but the beef market is looking at a huge glut, especially when the fall calf season arrives.
    One of the things the Canadian Cattlemen's Association was talking about was some kind of a nationwide price insurance in the western livestock insurance program. Can you please inform this committee of what your government's plans are in that regard?
    I had the opportunity to speak with the stakeholders in the sector very recently. We have to see what approach we can take in terms of regional programs versus what could be a national program. There are discussions under way. We are looking to see if there are any possibilities to look at it through the CAP, for example, through regional financial assistance to which the federal and the provincial governments could contribute.
    These are things that we are looking at right now.
    Okay. Specifically on price insurance, we heard testimony that the Maritimes don't have any such programs, so we're really looking for federal leadership.
    I understand, but I can't elaborate further now.
    Okay.
    In the little time I have left, Minister, we knew far before this crisis that the BRM programs were in sorry shape, and I think a little bit more of that has been exposed under the strain. I know some measures have been announced. Going forward, what kind of federal leadership are you going to be showing with respect to the provinces for long-term fixes to the BRM suite of programs?
    Mr. MacGregor, we are actually out of time. I'm sorry about that. The minister might have a chance to plug it in somewhere else.
    We will move to the second round for five minutes.

[Translation]

    Mr. Lehoux, you have the floor for five minutes.
    Thank you, Mr. Chair.
    Good afternoon, Minister Bibeau. Thank you for joining us this afternoon.
    You said at the start that $1.6 billion had been allocated to help producers. Can you tell me how much of that amount was allocated to the AgriStability program? Do you have that information on hand?
    Yes, about $320 million out of the $1.6 billion in previous years, on average.
    I gather that the rest of the money goes to the other programs. Is that right?
    Yes, the AgriInvest, AgriInsurance and AgriRecovery programs.
    Okay.
    Do you believe that the 75% improvement that you announced last week will make a significant difference and that it will help meet the sector's urgent needs at this time?
    The AgriStability program is meeting the demand. If needs arise, if producers have a bad year and if their margin drops by 30%, they can apply. The program used to allow for an advance payment of 50%, but it now allows for an advance payment of 75%. Producers can use the online calculator to see how much they're entitled to receive.

  (1750)  

    Minister Bibeau, you understand that this is a complex matter. The calculator may be very useful, but it doesn't send money to farmers the following week. We must remember that this crisis has been going on for almost two months and that people across Canada are on hiatus. The issues are piling up for our farmers.
    I want to address the AgriRecovery program. Last week, you announced two $50-million packages, one for pork producers and one for beef producers. However, we're hearing that this money isn't currently available.
    Minister Bibeau, as you know, the issues are affecting pork and beef producers right now. I'll provide a concrete example that concerns pork production in my constituency. Again last night, I spoke with producers. Hogs are being held in buildings because the processors can't meet the demand, given the physical distancing requirement that must be met in the plants where the meat is cut. This is causing a major issue. Some hogs are already 15 or 20 kilos heavier than the weight at which they would normally be slaughtered. The slaughter can't be delayed indefinitely. At this time, euthanasia is by no means out of the question. We mustn't forget that the piglets are already in the building. It's a matter of circumstances here.
    What's your solution for producers, under these conditions?
    I note that there are three parts to your question, Mr. Lehoux.
    I think there has been some confusion as to the timing of payment under the emergency processing fund. People are talking about the fall but that is really not the case at all. The expenditures must take place before fall. The criteria will be announced in the next few days. We will be able to pay out the money very quickly over the summer.
    Madam Minister, with all due respect, I want to point out that the summer will be too late, in my opinion. I visited a pork producer last week, and I can tell you that is not the way things are going in the industry. They are not going to be able to wait until the summer. Hogs are going to be euthanized.
    How are you going to deal with that?
    There are several things. For the pork sector, we have allocated $50 million to help producers cover exceptional costs, precisely because they have to keep hogs longer, and that could go as far as welfare slaughter. We want to avoid that, of course.
    There is also $77.5 million in assistance for food processors. These programs are available fairly quickly. The AgriRecovery program is administered by the provinces, which are as committed as we are to rolling it out very quickly. For processors, the criteria will be announced in the next few days and we will move very swiftly.
    I am going to come back to the issue of processing assistance because it is a really important industry. I have a plant in my constituency that employs 1,200 people. They have had to review the whole—
    Mr. Lehoux, unfortunately, your time is up.
    Thank you, Mr. Chair.
    Mrs. Bessette, you have the floor for five minutes.
    Mr. Chair, I will be sharing my time with Mr. Louis.
    Madam Minister, thank you very much for being here today.
    Thank you for the $252 million in assistance announced last week. I am already hearing positive feedback on the ground. This announcement is certainly timely, given current and projected needs in the agricultural sector.
    The poultry industry is of great concern to me because my constituency is home to one of Quebec's largest farms. Some growers have told me they have to euthanize chicks. Given the higher price of grain and a slowdown in the processing sector, obviously our growers are going through difficult times.
    How well will this first-ever Canadian program to buy unsold surplus food be put into operation, especially for poultry?
    Right now, our teams are in the process of putting the two parties in contact. Some sectors have surplus to sell. We often talk of potatoes, but there is also poultry. Our teams are trying to find out what is available, in what format, in what packaging and in what region. They are meeting with people in the three areas of Canada that have concerns about their food security.
    We want to connect sectors that have surpluses to sell with food bank networks. This program is not just about buying. It also provides assistance with logistics, transportation and the adjustment of certain packaging. We work with both sides to try to make a perfect match, if I may use that expression.

  (1755)  

    Thank you very much.
    I am fortunate to have several horticultural producers in my constituency. Many are delighted with the expansion of AgriInsurance to include labour shortages as an eligible risk. This insurance program is the result of a collaborative effort between the provinces.
    Where are you in discussions with the provinces on expanding the AgriInsurance program to address labour shortages?
    It is going well. As you know, we have given our approval. The decision needs to be made by both parties. The federal government supports this expansion, but the provinces are administering the program. In Quebec, it is the Financière agricole du Québec. Discussions are progressing well, but I must leave it to my provincial counterparts to announce whether or not they will join in.
    Perfect, thank you.

[English]

     Tim, it's all yours.
    Madam Minister, thank you for being here today and for all of your work with the industry, provincial leaders and local health authorities, providing us with the best-informed measures we can have to protect our food supply and support our producers.
    We have a vibrant agriculture and agri-food industry here in Kitchener—Conestoga, including the Waterloo Cattlemen's Association, the Waterloo Federation of Agriculture, the Waterloo dairy producer community and the Waterloo-Wellington chapter of Ontario Maple Producers. I've had the privilege of meeting with most of these groups, as well as with local farmers and board members from the Ontario Pork Producers; local organic farmers, as mentioned before, from Pfenning's Organic Farms; the largest live poultry service in Canada, which is Riverdale Poultry; and the president of Conestoga Meat Packers, which processes 40% of Ontario's pork.
    Madam Minister, my question is about balance, the solution for our agriculture sector. A sector this large can't be one-size-fits-all. Could you expand on some of the measures that our government is taking to address food security and help producers, from small farms to large companies?
    Thank you.
    I will not expand on all the measures that we have put in place for businesses, because the agriculture sector is also eligible for these programs. What we have announced recently is really focused on pork producers, beef producers, processors, those who have surpluses and the dairy sector. All these sectors have had recent announcements to support them better.
    I have to encourage the producers to apply to AgriStability and to take the money that is in their AgriInvest account. There is money there. This is why we have business management programs: to be there quickly when they face challenges. We have to use it first. We are hoping to fill the gaps as we continue the conversation with the different sectors to see who needs more help, and we'll be there for them.
     Sorry, Mr. Louis; that's all the time we have.

[Translation]

    I am sorry. That is all the time we had to hear from the witnesses.
    I would like to thank Minister Bibeau for being here today.
    At the beginning of the meeting, I forgot to thank Annette Gibbons, associate deputy minister of the Department of Agriculture and Agri-Food, and Colleen Barnes, from the Canadian Food Inspection Agency, for being here today.

[English]

    Mr. Chair, may I have a point of order, please? We started the meeting late, so I believe there are five minutes left, which is enough time for another round of questions.
    Unfortunately we are restricted in time, and for the first hour, that's unfortunately all the time we have. These technicalities happen. It might happen in the second hour also, but we try to divide it halfway. That's basically all the time we have. I apologize for that, but as we get on with this process, we will get better at it also.
    Again, thank you all. We will take a five-minute break. Please be back in five minutes for our second panel.
    Thank you very much.

  (1800)  


  (1805)  

     Good afternoon, Mr. Chair. Thank you for the invitation to appear before the committee and for seeing Canadian pork producers as an important part of Canada's economy.
     I'm Rick Bergmann, Canadian Pork Council chair and a producer from Manitoba. I will be sharing my time today with René Roy. He's a Canadian Pork Council vice-chair and a producer from Quebec.
    I'm quite honoured to be part of the pork sector. I see my farm contributing to the rural community and the wider Canadian economy by providing food to Canadians and people around the world. With $4 billion in exports and a positive trade balance, Canada’s pork sector could play a key role in restarting the economy.
     We have a great story to tell, but instead, I am here today because producers are not confident of the future they have in helping with the rebuild after COVID-19.
    As René and I go through this presentation, remember this quote from William Jennings Bryan: “Burn down our cities and leave the farms, and your cities will spring up again, as if by magic, but destroy our farms and the grass will grow in the streets of every city in the country.”
    This gentleman lived about a hundred years ago, and it's unfortunate that his wise words have become forgotten in many circles.
    The Canadian Pork Council represents 7,000 producers from coast to coast. Combined, producers bring a GDP value of $24 billion to our great country of Canada, and we are a major employer.
     Pork production is a diversified agricultural sector. All of that diversity has not been enough, though, to protect pork producers from being pushed into a crisis by COVID-19. Really, because of the current government program, producers are at their wits' end in this time when we are seeking meaningful help, help that will make a difference.
    First and foremost, our current crisis is a cash crisis. That means farmers do not have the income they need to pay their bills, feed their animals and keep the lights on. We are trying to navigate market conditions, and they are incredibly volatile right now. The drop in our market price has been incredibly steep and the recovery is quite slow.
     Our conservative estimates are that pork producers will lose, on average, about $30 a hog for every pig they sell in 2020. In some regions, that loss may be $50 an animal. This doesn't mean that pork producers will lose $30 on every animal they sell since the beginning of the crisis in April: It means that because of the damage done to the pork market, for every market hog that is sold in 2020 from January to December, farmers have lost or will lose about $30 a hog on average.
    These losses are not sustainable at all. They will force farmers out of business. Unfortunately, the hardest hit will be the mid-sized family farm, the young farmer and those farms that have been struggling through the years of depressed prices as a result of the global trade war between China and the United States.
    The U.S. government has recognized the hurt their producers have experienced over the past few years due to the trade war and, most recently, the impact of COVID-19. Canadian pork producers, forced to compete against this support, continue to remain at a disadvantage.
    As farmers, to us the answer is extremely clear. Over 90 countries around the world knock on our door for valued Canadian pork, so it seems as though our government should do the same. Our food security is too important to leave in the hands of the rest of the world, and we have a good story to tell here. We've just got to get back at it.
    I want to take a moment to clarify where COVID-19 has hit the farmers so hard and why we need your help.
    Pork production in Canada is a just-in-time business. There are several business models, but for the most part, barns are built so that the sows are housed in a farrowing barn, where the piglets are born. When the piglets are weaned, they are moved to a different barn, and a new group of sows goes into that farrowing area after it is washed and disinfected.

  (1810)  

     The piglets are then moved through different facilities as they continue to grow. In some operations they will be sold at 15 pounds or at 50 pounds, as in my operation. These feeder pigs are then transferred to another facility where they're grown into 260- or 270-pound market animals, and away they go to the processing plants.
    However, regardless of where you farm or what your business model is, these operations do not have the extra capacity to hold the animals. Barns are designed to refill as soon as a group of pigs is sold. COVID-19-related reductions in slaughter plants and slaughter plant capacity have meant that market-ready hogs aren't able to move out of the barn. This, in turn, means that the next batch of pigs cannot move forward, so you can understand the just-in-time philosophy that I just mentioned.
    The backlog in the U.S. has been particularly bad. There they have seen processing plants close for extended periods. Given how connected our two industries are, the impact on U.S. prices has hit Canada hard for producers who export weaned pigs into the U.S. My farm, for example, has needed to give piglets away because we were not able to sell them and we needed to make room. It's a considerably important part of our marketplace. In 2019, the export of animals was valued at $250 million.
    I'd like to invite my colleague René to carry on with the story.

[Translation]

    Due to the temporary shutdown of processing plants in Quebec and Ontario, more than 100,000 pigs that should have been processed are instead stuck on farms. It is costing farmers money to feed those pigs. Their welfare is at risk and, adding insult to injury, they are losing value as they get further from the target market weight requirements.
    This backlog of hogs and the COVID-19 market disruptions are being felt on two major fronts.
    First, it has driven prices down and pushed many farmers into a cash crisis. While the price has recently strengthened, it is still seasonally low and still well below the cost of production. Farmers are unable to sell their hogs and must continue to feed them to avoid euthanizing them. For some, such as my colleague Mr. Bergmann, who specializes in early weaned piglets, it is hard to find a market.
    Second, it has forced some producers to take more drastic actions as their losses become even more unsustainable. We know that farmers across the country have been forced to dispose of animals because they have not found a market for them. For a farmer, that means a lost income and added costs. For Canadian families, it means that good food has gone to waste.

  (1815)  

[English]

    Other farmers have taken steps to reduce their production. For some this means not breeding sows and for others it means aborting sows that were close to farrowing. Both situations result in reduced incomes and put an increased psychological strain on farmers, a situation made even worse because food is being taken out of the supply chain.
    Should it continue, Canada will see reduced exports and a greater reliance on imports, and in extreme cases the reduction in production will contribute to a food shortage. Producers have been calling for emergency actions to help us get through the crisis. Based on losses of $30 to $50 per pig, we've asked the government for crisis payments of $20 per hog.
    We have said from the beginning that it's up to the government to figure out the most efficient and effective means to get the money to pork producers as quickly as possible. Pork producers have long called for changes to the programs. We also strongly urge the government to make the changes necessary so that payments, including interim payments, can flow more quickly. Without these changes, the program will offer little support.
    We heard that the business risk management suite offers farmers $1.6 billion in support. However, our focus is on pork production, not on all agriculture. Based on decades of experience with farm programs, we know this level of support is not available to pork producers—

[Translation]

    Thank you, Mr. Roy.
    Unfortunately, your time is up.
    I will now go to Mr. Groleau, of the Union des producteurs agricoles.
    Mr. Groleau, you have the floor for 10 minutes.
    I will be fairly brief, because I want to take a few minutes at the end of my presentation to explain to the members of the Standing Committee on Agriculture and Agri-Food how the AgriStability program works. A lot was said about the program during the minister's presentation. There are a number of different opinions.
    First of all, I feel there is a general misunderstanding of how the program works. We are going to try to do an exercise with you to explain how it works.
    In Canada, agriculture accounts for $112 billion in revenue, $60 billion in exports and $68 billion in farm gate revenue. It is one of the biggest economic sectors in our regions.
    This sector has been hit by the COVID-19 crisis. Meat packing plants have been shut down, the consequences of which have just been explained to us, and there is a labour shortage. A number of things have been done to address this. Markets have been lost and disrupted. In addition, producers have had to dispose of products, resulting in net losses for them.
    We are starting to be able to quantify the losses. In poultry alone, nationally, the losses are $115 million, and in beef, according to the Canadian Cattlemen's Association, it is $500 million. Quebec grain producers have estimated losses in value, taking into account the advances on the American market, to the tune of $86 million in Canada for two grains alone, corn and soy.
    The processing sector, especially meat packing plants, has sustained heavy losses. The sector has also had to put in place the safety measures required to protect employees. In Quebec alone, losses amount to $100 million or more.
    The assistance measures announced last week fall far short of our expectations. However, the program to support temporary foreign workers when they arrive is a substantial effort that I would like to highlight.
    As for the other programs, the aid is insufficient compared to the $19 billion provided by the United States to address the COVID-19 crisis. That is 10 to 12 times more than was announced last week here in Canada.
    The future remains very uncertain and market fluctuations are highly unpredictable. The AgriStability program, which should be helping us cope with the situation, is not working. That is why only 31% of producers in Canada are participating in it. Producers are not fools. If the program worked, they would enrol. The reason producers are not enrolling is not because they do not understand it, but because it is not working.
    I find it hard to hear the minister tell us that we should use the $2.2 billion in the AgriInvest program that we have in our accounts. That money is not necessarily in the accounts of the producers who are struggling right now. Quebec pork producers only have $40 million in their AgriInvest accounts, with a production value of $1.4 billion. We are being asked to use that $2.2 billion, but it is not available directly. It is like asking people to make sure they empty their bank accounts before applying for employment insurance. It is like telling the students who have just been offered $9.5 billion that only those with nothing in their accounts are entitled to it. That argument does not hold water.
    With regard to the $1.6 billion theoretically available to producers that Ms. Bibeau is urging us to use, let me point out that last year more than $1.1 billion of that $1.6 billion was paid out in crop insurance in Canada. So it has nothing to do with AgriInvest or AgriStability.

  (1820)  

    So, naturally, we are asking for emergency funding to meet the current needs of businesses in the meat sector, for example, which are experiencing particular difficulties. This is mainly to improve risk management programs. The repercussions of the crisis are more than just immediate. They will be felt this year, but undoubtedly next year as well. If our risk management programs in Canada are inadequate, producers are going to be in trouble now and even more so in the coming years.
    Now, I would like us to look at the AgriStability table. I don't know if you have had a chance to look at it, but I am going to do a little exercise with you. Ms. Bouffard will be able to help me if I need it. As an example, we took an average farm in Quebec with $250,000 in annual revenue and $100,000 per year in historical allowable expenses. Under the current program, allowable expenses are capped and family labour is not an allowable expense. Therefore, small operations in particular are penalized.
    This operation has a historical reference margin of $150,000, that is, $250,000 less allowable expenses. This year, due to COVID-19, it will have a reference margin of $70,000. So, this operation lost $80,000 this year on a gross income of $250,000. That is huge. This year, because this operation has a reference margin of $70,000 and compensation starts at 70% of $100,000, or $70,000, AgriStability will pay it nothing at all. So, even if the operation wanted access to 75% of what the AgriStability program would pay it, it would not receive a penny. Yet this operation lost $80,000 compared to a reference margin of $150,000. That's more than half.
    We have proposed enhancements to some of the AgriStability program criteria. For example, the historical margin should no longer be capped. In the second column, the historical margin is not capped at $100,000; it is $150,000. If we do the calculation, 70% of $150,000 is $105,000. That is $35,000 more than the $70,000 reference margin. If we multiply it by 70%, this operation would get $24,500. If we increase reference margin coverage to 85%, the operation would get $40,250.
    The third column represents how the program was before the 2013 budget cuts. In 2013, when the program was said to be working, an operation whose margin declined by $80,000 would have been compensated with an amount equivalent to 50% of its reference margin. As Mr. Blois was saying earlier, to get 50% loss coverage, we would have to go back to the program as it was before 2013.
    We may send you a more detailed table, but what we are trying to tell you is that, no matter what party you represent, AgriStability is not working. That is why producers are not participating. AgriStability works even less for small farming operations because it does not cover participant opt-out and family wages as allowable expenses.
    So, I ask you all to work in a non-partisan manner to improve this program. If you really want to support Canadian agriculture, it is essential that you do.

  (1825)  

    Thank you, Mr. Groleau.
     Janice Tranberg and Michel Daigle, you have the floor for 10 minutes.
    Mr. Chair and honourable committee members, thank you for having us here today. On behalf of the National Cattle Feeders' Association, or NCFA, thank you for the opportunity to outline the economic impacts of COVID-19 on cattle feeders across Canada.
    My name is Michel Daigle, and I am the chair of the board of directors at NCFA. The first part of our presentation will be in French, and my colleague Janice Tranberg will finish the presentation in English.
    NCFA is the national voice of Canada's cattle feeders. Our focus is to improve the growth, sustainability and competitiveness of our industry. The challenges of COVID-19 to the beef industry...

[English]

    Mr. Chair, on a point of order, I don't think he has his translation on correctly. We are hearing both languages at the same time on the English channel.

[Translation]

    I am going to ask the technicians to give Mr. Daigle a hand.

  (1835)  

[English]

     Thank you very much, and I apologize for the problems. Maybe I'll just take over where Michel left off and talk a little bit about the challenges of COVID-19 that have hit the beef industry.
    There has been a dramatic reduction in beef processing capacity in both Canada and the U.S., and this has caused cattle to back up along the entire beef chain. The current backlog is around 130,000 animals and it's growing by 6,000 to 9,000 head per day. The additional costs of feeding these backed-up cattle is around $3.50 to $4.00 per head per day. Right now this is costing cattle feeders in Canada around half a million dollars.
    Fed cattle prices have also collapsed, generating a severe cash flow issue and liquidity problems. Markets have been severely impacted by uncertainty, volatility and even panic selling. Current losses are up to $600 per head. An average feedlot with 15,000 head capacity is thus seeing additional feeding costs of some $50,000 per day and a loss of $7.5 million in revenue when the cattle are brought to market.
    The priority issue for NCFA is to ensure that processing facilities get up and running as soon as possible, that they can move forward and that prices can stabilize, but there are many challenges to overcome before processing capacity can return to normal. Until such time, cattle feeders need the support of the government to remain viable.
    We have been monitoring the supports for cattle producers in the U.S., and whatever happens south of the border has a competitive impact on the industry north of the border. The U.S. is providing direct payments to cattle producers of $5.1 billion U.S. An investment in the Canadian cattle industry of $600 million would be roughly equivalent to the U.S. investment.
    We appreciate the open and transparent communication that's been happening between the government and the sector throughout the pandemic, and we share a common goal around the table of having a reliable and safe beef supply for Canadians and a competitive Canadian beef sector. We thank the government for the support announced last week. However, it falls significantly short of what is required, and we would like to respectfully outline some of the reasons why today.
    The government noted in its announcement that the agriculture sector already has $1.6 billion available through current business risk management programs. The government has also noted that there's $2.3 billion sitting in the AgriInvest accounts of producers, but these funds are not always accessible to farmers, and this is especially so with Canada's cattle feeders. AgriInvest is a producer government savings account that helps farmers manage small income declines and makes investment to manage risk and improve market income. However, given the collapse in market prices for cattle, approximately 85% of all beef processing is currently at risk, so it's quite likely that beef producers have already drawn what they can from their AgriInvest accounts.
    Of the $1.6 billion paid out in AgriStability, AgriInsurance and AgriInvest, $1 billion comes out in the form of insurance payments for producers for production failures, primarily for crops. Then of the remaining $600 million, about $300 million is allocated to AgriInvest, and matching programs, which I previously mentioned, can help only those who are able to put savings into their accounts. The remaining $300 million is largely used in AgriStability for direct payments to producers experiencing severe income decline. This is allocated to all agricultural producers.
    The COVID pandemic is not a normal business occurrence and it cannot be addressed by the business risk management programs in the current format. The government announcement last week of $50 million for the fed cattle set-aside program is certainly appreciated, but the reality is that the current backup at the farm gate is 130,000 cattle, which are costing producers around $500,000 per day to maintain, and their value has fallen from $250 million to $165 million. The backup at the farm gate will continue to grow in the coming weeks, and the sector needs a more significant financial commitment.

  (1840)  

    The NCFA is also calling for a number of supports that were not part of the recent announcement and will help to provide cattle producers the support they drastically need. We're requesting changes to the current business risk management programming to benefit cattle ranchers and feeders.
     Under AgriStability, we're asking for the $3-million cap to be removed. For an average feedlot, this cap already removes them from being able to access these dollars. We're also asking for other AgriStability changes, such as increasing the trigger from 75% to 85% for the remainder of CAP, the partnership agreement; invoking the late participation clause, to allow producers access to the needed support; and removing the reference margin limiting, for meaningful and longer-term support.
    A serious issue for cattle feeders managing this pandemic is business liquidity. The spring is a very busy time of the year for farmers and the need to purchase inputs is acute. With significant losses due to falling market prices and with not being able to move their cattle, feeders need access to financing.
     We've asked the government to issue a stay of defaults under the advance payments program used to finance the purchase of cattle. This would increase liquidity by extending the repayment further down the road. The interest-free portion of the program should also be increased, as this is particularly useful for younger cattle producers with less liquidity in their business operations.
    We call for the government to increase federal financial backstops and loan guarantees to banks and financial institutions, allowing producers access to expanded operating credit limits and increased liquidity. We also request that the government ensure that chartered banks and financial institutions pass on the interest rate reductions. This is key to maintaining liquidity in the cattle industry.
    We recognize that all sectors are calling upon the federal government for support through this pandemic, but besides health care, there can be no more critical sector than food, and we ask that additional federal supports be provided accordingly.
    Thank you for your consideration.
     Thank you, National Cattle Feeders' Association.
    We'll start the questioning round.
    If everyone agrees, because we are short in time, we'll go through round one, but we'll probably have to shorten it to four minutes each to be able to get everybody in.
    Is anyone opposed to that, or are we good with four minutes each for the first round?

[Translation]

    Could we discuss it at the end of the meeting? We should establish a system for future meetings. I see we are running out of time, so we can continue.
    We had also planned to hold a meeting afterwards. It will be possible if the people on the team around us agree to give us some time.
    We are going to have only four minutes each. That is all that is possible given the time constraints.
    All right.
    So, let us move on, so we do not lose any witness time.

  (1845)  

    Does everyone agree to that?

[English]

    Mr. Chair, you're saying we cannot go past seven o'clock.
    We can perhaps go past by a few minutes, but generally they want us to stick with the time we have. That's how it works. We have no control over that. We'll try to stretch it as much as we can, but I think that's all we can do with the shortening of time for everyone at this stage.

[Translation]

    Mr. Lehoux, you have four minutes.
    Thank you, Mr. Chair.
    I will be sharing my four minutes with my colleague Mr. Soroka.
    My first question is for Mr. Roy.
    You are asking for emergency assistance at $20 per hog. Will this help keep producers from euthanizing the 100,000 hogs in Quebec and the 140,000 hogs in Canada?
    It would help producers get through the crisis. At the moment, there is assistance for processors. The $70 million that was announced is actually for processors, which is very good news. However, for producers to get through the crisis, they need cash flow immediately. This $20 will make it possible to continue producing quality food.
    As I understand it, the programs currently available will not be able to provide producers with the assistance they need to get through the COVID-19 crisis. Is that correct?
    Yes, indeed. As has already been said, the AgriStability program is very ineffective in an emergency situation like the one we are currently experiencing. There are always delays. So it is very ineffective at helping producers in a crisis like the one we are currently experiencing.
    Thank you, Mr. Roy.
    Mr. Groleau, you described the situation with AgriStability to us very well. I hope that everyone will read the document you sent to us, so that we can analyze it.
    My question is quite simple. Do the minister and senior federal officials understand the situation? From what you have explained, it is pretty clear that the program is not working. Why has it not been adjusted quickly to meet your needs?
    I gather this is not the first time you have brought this issue to the attention of officials and the minister, is it?
    It isn't, of course. The program used to work well, but it was cut back for budgetary reasons in 2013. The cutbacks reduced Canadian agricultural producers' ability to compete more effectively with the American sector.
    According to a current analysis by the Organization for Economic Cooperation and Development, or OECD, the value of Canada's agricultural support is half that of the United States. This is based on the value of Canadian production. If federal support for agriculture does not rebound in the medium term, Canadian agriculture will clearly suffer.
    Thank you, Mr. Groleau.
    Mr. Soroka, I yield the floor to you.

[English]

     My question is for the the National Cattle Feeders' Association.
    I know that the set-aside program only covers pay for the feed and doesn't cover the cost of the loss of the calf, but how long will the dollars last to pay for this feed anyway?
    I'll take this, Michel.
    It's very hard to say exactly how long this will last, because the situation is adapting and changing. In terms of the program we put together, I think we're now in what I would consider a worst-case scenario, with less than 50% production occurring. It's obviously going to take quite a bit of time to get production up to normal levels. Also, even for normal levels, right now I think I would say that 100% post-COVID production is probably going to be equivalent to 80% to 85% pre-COVID production, so the absolute best—
    Thank you, Ms. Tranberg. We're unfortunately out of time, and we're running very tight.
    Mr. Neil Ellis, please, for four minutes.

  (1850)  

    I'm going to be splitting my time with Mr. Drouin.
    Ms. Tranberg, you mentioned that the backup was at around 130,000 cattle right now. What about the backup in January and February? What kinds of numbers were we at before COVID hit?
    There wasn't a backup. I mean, everything—
    There wasn't a backup at all.
    Well, that's not true. I'm not sure if Michel can answer, but there certainly was some production backup in the eastern part of the country.
    Michel, are you able to answer that question?

[Translation]

    Thank you, Ms. Tranberg.
    In January in eastern Canada, we were a little behind in slaughter, which was not the case in the west. You have to realize that the situation is often a little different across the country. Right now, the opposite is true. The big meat packing plants out west are doing far less slaughter. The backlog of cattle is very high in the west and less so in the east, because to date, no meat packing plants have been shut down in Quebec and Ontario due to COVID-19.

[English]

    Thank you.
    Also, you mentioned the loss per head. Was it around $600? I think that was what you quoted.
    That's an average, yes.
    On average, and profit-wise, do you have an amount before COVID-19 hit?
    I don't have an exact amount, but I can tell you that some of my members have told me that they've actually hit losses closer to $800. This is a loss that they've never seen before, even in times of BSE. These are pretty phenomenal losses.
     Again, Michel, maybe you can back me up on this. To see losses in the range of $300 is significant, but it's manageable. When you start getting into losses that are $500, $600 and more, it's drastic.
    Okay. Thank you.
    I'll share my time with Mr. Drouin now.

[Translation]

    Thank you very much, Mr. Chair.
    I would like to thank my colleague, Mr. Ellis. It is very nice to see some familiar faces on our committee.
    Mr. Groleau, you mentioned the 85% reference margin. I am not a member from Quebec, but I live very close to the province. I know that Quebec has supplemented the AgriStability program. Does that mean more farmers are participating in the program? The Canadian Federation of Agriculture is asking that the same be done nationally. With 85% reference margins, is the program being used even more?
    In our province, we are required to enrol in AgriStability because there is a group insurance program for several sectors. In Quebec, the enrolment rate for AgriStability is over 70%. That is what brings the national average up to 31%. Were it not for Quebec, the national average would be under 30%.
    The Agri-Québec Plus program is the main tool helping to rectify the situation in Quebec. The program comes in at an 85% reference margin, but it is capped when an operation is profitable so as not to give undue compensation. So, there is a way to adjust the program at the national level as well.
    Thank you, Mr. Groleau.
    Mr. Perron, you have the floor for four minutes.
    Thank you very much, Mr. Chair.
    I would like to thank the witnesses for being here.
    Mr. Groleau, I was very pleased to hear someone other than me say that AgriStability is not working. I also note, further to the answers to Mr. Drouin's questions, that this is another area where Quebec is somewhat making up for what the federal government has bungled in the past.
    If I understood you correctly, there was a program that worked in 2013 and it does not work today. Is that correct?

  (1855)  

    Yes.
    All right.
    Mr. Groleau, here is what I wanted to discuss with you. When they say that you have to use existing programs and they tell you about a new magic calculator that has appeared on a website, do you feel that really helps producers?
    I doubt it. As the example I gave you shows, a farm has to be technically bankrupt to receive anything significant through AgriStability. It's as simple as that. I gave you the example of a farm with a $150,000 reference margin that lost $80,000. Even in that extreme case, the program offers no help. I can't make it any clearer than that.
    That means people are paying taxes and receiving no support from the government.
    We often compare ourselves to the U.S., since they are our closest neighbour, but we could also look to countries in Europe. What medium- and long-term consequences are you anticipating? Agriculture has been receiving less support in Canada than it has in other countries for quite a while now. What's going to happen in the next few years?
    Correct me if I'm wrong, but I suspect we're at risk of becoming reliant on other countries and experiencing food shortages. The scarcity of food would likely lead to an increase in food imports. Can you confirm whether that's true?
    The main reason Canada's agricultural sector is able to compete right now is that the exchange rate works in our favour. If the loonie were at par with the U.S. dollar, or even rose to 90 cents, it would devastate the sector. Can that be the foundation for an industry like agriculture? The answer is no.
    Canada absolutely has to have business risk management programs that are competitive with Europe's and the U.S.'s.
    Thank you very much.
    I heard your warning, and I understand the need for immediate action, so I will echo your plea.
    Lastly, I'd like you to explain the importance of something young farmers are calling for regarding coverage for small businesses. They have trouble qualifying for one-time assistance in the form of loans.
    Can you explain it to the committee members so that everyone understands?
    The problem is that general partnerships aren't eligible for the $40,000 small business loan, because withdrawals made by owners aren't considered payroll. To qualify, businesses have to have paid $20,000 in payroll last year. That rules out a large number of Quebec's small businesses, since the government hasn't changed the requirement, despite our requests.
    That means small farm businesses in Quebec and across the country are in serious jeopardy right now. Isn't that so?
    Those businesses aren't eligible for the support measures that have been announced, so-called important measures for the sector.
    Thank you, Mr. Groleau and Mr. Perron.

[English]

     Now we go to Mr. MacGregor for four minutes.
    Thank you very much, Chair.
    I'll start with Ms. Tranberg of the National Cattle Feeders' Association.
    Could you remind the committee of what you said in your remarks about our processing capacity? Did you say we're at about 50% now, but you don't really expect that to get much higher than 85% in the coming months?
    That would be correct. All the things that needed to be done to make the plant workable—they had to put partitions between people, and they had to increase space for social distancing—will slow down production. We don't know precisely, but at least in the short term, full capacity probably is not going to be much past 85% of what it was pre-COVID.
     Yes, and that's very troubling. I was looking at some research from the Western Stock Growers' Association. They estimated that we may see a rolling backlog of over 375,000 head of cattle. They think the glut might happen right at the peak of the fall calf run.
    If we're going to have this rolling backlog and we're still not going to have processing capacity up to 100% even in a few months' time, is there an ability to build additional feedlot storage area?
    My big question is, how are we going to deal with this glut? How long can the National Cattle Feeders' Association keep going with this huge backlog of cattle in its facilities?

  (1900)  

    We're reaching peak right now, and you're talking about whether they can build more capacity. They can't even manage the capacity they have. You have to have finances to be able to support your cattle right now, let alone looking at building even more.
    To expand on the previous question—sorry—$50 million barely covered our best-case scenario, which was that the plants would produce at 85%. For a while, we were below 50%, and now we're just barely back to 50%. It's going to take us quite a bit of time to get back to normal. We're not going to be able to cover the costs certainly in the short term.
    I don't have a lot of time left, but looking forward, I don't think it's too early to start thinking about how we can build resiliency into our system so that we're better able to withstand shocks like this in the future.
     Do you have any thoughts to add on that? How do we build resiliency into the system in two or three years so that when something like this comes again we're not going to be in such a sorry state?
    Well, you're asking me to look into my crystal ball. I would just say that some of the changes being looked at under business risk management are things that would help provide better liquidity and resilience.
    Michel, I'll give you a chance to respond.

[Translation]

    In recent history, the slaughter or processing industry has been so concentrated that two big players alone account for 75% to 80% of all cattle slaughtered in the country. When an epidemic of COVID-19 proportions breaks out, this is exactly what happens. In the future, will—
    Thank you, Mr. Daigle.
    Unfortunately, that's all the time we have.

[English]

    I would like to thank the three panels again.
    Thanks to the Pork Council, with Rick Bergmann and René Roy.

[Translation]

    I'd also like to thank Marcel Groleau and Isabelle Bouffard, from the Union des producteurs agricoles.

[English]

    Also, thanks to the National Cattle Feeder's Association, Janice Tranberg and Michel Daigle.
    I apologize for the issues with the sound as we learn how to navigate these new technologies.
    Thank you, all. You may now leave.
    I will ask all the members to stay with us to settle one or two business issues.
    We have just learned that the meeting next Tuesday will be cancelled. What I need to know from the committee is where you want to put that meeting with the same panel. In other words, our next meeting will be the following Friday, on the 22nd. Do you want to take the Tuesday meeting and move it later on, or do you want to continue...?
    Don't forget that on Friday, we have the Minister of Immigration, Mr. Mendicino. On Tuesday, we have the horticulture sector and foreign workers. I need to get some direction as to how we want to proceed on Tuesday the 19th.

[Translation]

    Mr. Perron, you have the floor.
    I wasn't aware that Tuesday's meeting had been cancelled. Can we reschedule for Wednesday or some other time during the week?
    No. We just found out as well. There won't be any meeting at all on Tuesday. It's postponed. Other committees may be sitting, but our meeting has been cancelled. We may be able to make it up later, but at this point, we just need to figure out whether we want to postpone or stick to the schedule and push it to Friday. As I said, we have the minister appearing on Friday. I don't know whether he'd like to postpone his appearance. I'm open to suggestions.

  (1905)  

[English]

     Mr. Chair, I will ask you a couple of questions on this.
    First of all, why is it cancelled? None of us have heard a reason why.
    The other question I have is why can't we go over today? We're obviously going over the seven o'clock meeting time to discuss this. We had four minutes of questions for that second round. I know it's not our fault that we had technical issues, but I think that has to be addressed. Why could we not have gone past seven o'clock? Is there a reason that there is a deadline? You said they don't want us to go past seven o'clock. Who are “they”?
    As you can imagine, there's a whole team making this happen. We were told not to exceed, as much as possible.
    Obviously, we're a little bit over time now and we're thankful that they have stayed around. Sometimes it's not even that; it's the fact that there's another committee after us. That's not the situation this evening.
    Sometimes we manage to get a few minutes, but I try to be fair to everyone and to keep us on time.
    We can modify if you wish. We can look at the time for witnesses. We can look at different ways of doing this. Unfortunately, with the new technology there are always some issues that come up which cut into some of our question time.
    Mr. Chair, I would like to make a proposition.
    Sorry Francis, I just....
    I know we talked about it last week, and I would suggest that we try to get to two witnesses per hour, then, and have seven minutes instead of 10. I thought we did talk about that last week, cutting them down to seven minutes.
    Obviously we are all in different situations. I think it's really important that we have as much time for questions and answers as possible.
    Francis, maybe that's what you were going to suggest. I didn't mean to cut you off, but maybe your input....
    Go ahead, Francis.
    If we do want an extra meeting, honestly, I don't want to say it's beyond our pay grade, but that has to be discussed with the whips. The whips will make that decision.
    I noticed that the AGRI committee will be held at the same time as the finance committee next week, so again, based on the technical folks who are available, those supporting us, it always depends. If they're not available, then our committees will get cancelled, and finance, PROC and—I think there's another one—health get priority over us. That's why we're going to get these things happening based on the motion that was passed in the House.
    John, I'd like to clarify also that all the whips of different parties got together and decided that at least our committee was not going to meet on Tuesday. We didn't make that decision. We learned about it just prior to the meeting.
    No, I wasn't insinuating that you cancelled the meeting on us, Mr. Chair. I was just wondering what....
    Thanks, Francis, for that explanation. We're trying to book these witnesses so far in advance. I know there's limited technology. I just wanted to know why ours was cancelled.
    John, we have no problem with seven minutes if there are two witnesses. That would allow everybody to get at least a round or two in. We're fine with that.
    Did I hear two witnesses for seven minutes instead of 10? Is that what you suggested, Mr. Drouin?

[Translation]

    I have something to add to that proposal, Mr. Chair.
    We're all ears, Mr. Perron.
    You brought up fairness, but it's hard to keep things fair when interpretation is involved. We are all reasonable people, and we understand that technical glitches can occur from time to time.
    I suggest we adjust the amount of speaking time as well and that we follow this principle: if we start a round of questions, we finish it. That keeps things fair and respects member representation in the House. Even when Parliament is sitting in Ottawa, oftentimes, the Bloc Québécois and the NDP don't get an opportunity to ask questions during the second round. Earlier, when the minister was here, neither the Bloc Québécois nor the NDP had a chance to speak.
    As for how speaking time could be adjusted, here are some random numbers. In the first round, everyone could get five minutes. In the second round, it would be four minutes. The amount of time during each round would decrease proportionally in order to finish each round. That would be a fairer way to do things.
    With respect to the first round, we already determined the time allocated to questioners back when we started sitting. That's how it is. Reducing the time we give witnesses for their opening statements may give us more time to do two rounds. Keep in mind that, if we give the three witnesses 10 minutes each, we lose a half-hour right there.

  (1910)  

    That's right.
    We know that technical difficulties arise from time to time.
    I agree, Mr. Chair, but with all due respect, I'm certain that we'll never have enough time to finish the second round. We're going to wind up in a situation—
    It works fine in other committees, but again, it depends on the technical issues that come up, and we can't predict those.
    It's no one's fault. What we could do, though, is cut the time we give witnesses from 10 minutes to seven minutes, and reduce everyone's speaking time during the first round from six minutes to five minutes—I wouldn't exactly call that a huge loss. In the second round, we could go with four minutes, instead of five. The time allocated to the Bloc Québécois and the NDP would decrease proportionally. After all, the point isn't to get more time vis-à-vis other parties. It's simply to make sure that we get through the rounds and that everyone receives fair treatment. I would ask you to consider my suggestion.
    The committee already adopted a motion giving all committee members six minutes during the first round. I think that's fair, but I understand what you're saying.
    If the committee doesn't want to change the first round, it can still change the second round.
    In the second round, the Liberals and the Conservatives have five minutes, while the NDP and the Bloc Québécois have two and a half minutes.
    That's right, but, if we knock off—
    We should have enough time.
    We may need to shorten how long we give the witnesses, if we want to have enough time. Otherwise, we are left with only a half hour, and that's if we don't run into any issues.
    Let's try that. I would ask the committee members to keep it in mind, because it's a reasonable option. You said the committee had already decided, but nothing prevents us from making a different decision.
    I don't want to spend too much longer on this, but what we need to decide tonight is whether we are postponing Tuesday's meeting with the witnesses that have already been invited and keeping the meeting with the minister on Friday as scheduled, or whether we are going to push the entire schedule because we can't meet on Tuesday. In other words, Tuesday's meeting would move to Friday and so forth.

[English]

     Mr. Chair, I would suggest that we don't try to reschedule the minister. If we have the minister booked for next Friday, I would suggest that we keep that meeting as is and try to reschedule those Tuesday witnesses to another day.
     I don't know if there is another day next week that the Tuesday meeting can be moved to so that we can slot that into our schedule with the technology. My suggestion would be to leave next Friday as is with the minister. His schedule, I'm sure, is very chaotic. If we have him booked, I would suggest that we leave it at that and take those Tuesday witnesses and see if we can find another day to have that meeting.
    Okay. Are there any other comments from the other parties?
     Mr. MacGregor, do you want to weigh in on this?
    I'm good.

[Translation]

    Mr. Perron, are you okay with postponing Tuesday's meeting and keeping to the schedule, as the others are suggesting?
    We could reschedule Tuesday's meeting next week.
    I'll leave that to the clerk.
    Is it feasible to hold three meetings in one week?
    I don't think it'll be possible since the time allocated for committees is already quite limited, but we will still ask. As soon as we can reschedule the meeting with the witnesses, we will add it to the schedule.
    Wonderful.
    I invite everyone to think about options. You can send me your suggestions, and I'll share them with the committee. If we can reach a different consensus, we will.
    I'd like to thank the IT team for giving us an extra 15 minutes.
    Have a good evening everyone. See you on Friday.
    The meeting is adjourned.
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