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Trade Still Key for National Boards

Interprovincial, as well as international, trade negotiations the focus for 2010


April 23, 2010
By Dan Woolley

Topics

Trade, both interprovincial and international, dominated the discussion
at this year’s annual meetings of the Nova Scotia feather boards.

Trade, both interprovincial and international, dominated the discussion at this year’s annual meetings of the Nova Scotia feather boards.

Trade, declared Glen Jennings, Nova Scotia Egg Producers (NSEP) chairman, at the NSEP annual meeting, is the
most important issue facing the Canadian egg industry.

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He conceded 2009 was a pretty quiet year on the trade issue; but he told his membership there will be a point when egg producers will be called again to lobby their MLAs and MPs on trade.

trade
Trade on the Table. CFC chairman David Fuller says that interprovincial movement of chicken will be a key focus for the board this year. He also says that CFC has filed for two judicial reviews in the courts over the Farm Product Council’s handling of base allocation.


Jennings also thanked the federal government for its current position on no reduction in over- quota tariffs or increased minimum market access. However, he observed, current text for a new World Trade Organization agreement doesn’t look good for supply management.

Tim Lambert, Egg Farmers of Canada (EFC) CEO, told the NSEP members, at some point, the WTO discussions on agriculture will pick up, adding they have been bogged down because the U.S. is in recession.

At some point, continued Lambert, the U.S. economy will rebound. President Obama doesn’t want to be seen as protectionist and so the U.S. is pushing for more market access to the developing BRIC countries, Brazil, Russia, India and China. He also noted there is “evident tension” in Geneva between the developed and developing countries over market access and the Canadian government is resolved to protect supply management.

Recently, Gilles Gauthier, Canada’s trade negotiator, said if anything, things are trending backwards in the trade talks,  noting trade negotiations are also underway between Canada and the European Union. Each side has put 90 per cent of their tariff lines on the table; although the EU will be more protective of its agricultural sector.

The Canadian government has provided assurances that supply management is not on the table, said Lambert. “Nothing we can see coming out of the EU deal impacts eggs.”

In the meantime, EFC have requested another meeting with federal policy makers to follow up on the continuing commitment to protect supply management, he added, admitting that at the WTO clearly the major decision makers  are the US and the EU. “The challenge becomes when you get to the 11th hour and the EU and the US have some kind of understanding on how they will proceed. The challenge will be for Canada on how it signs the deal and continues to protect supply management.

Laurent Souligny assured the NSEP members: “We’re not hearing that Canada is alone. People know and understand Canada’s position.”

Lambert said the Europeans now have a better understanding of how strongly Canada feels about supply management. He felt any deal Canada would reach with the EU would set some sort of precedent for what Canada would accept at the WTO.

With the slowdown in the WTO’s Doha Round, there has been a shift to bilateral trade deals between countries, with the big gap, observed Lambert, between the EU and the US and the US and the BRIC countries.

Peter Clarke, EFC vice-chairman and Nova Scotia director, said the EFC continues to work with its national and provincial partners in supply management to ensure the politicians continue to hear the industry’s trade message.

At the Chicken Farmers of Nova Scotia annual meeting, David Fuller, Chicken Farmers of Canada chairman, said the world economy took a hit in 2009, describing it as, “a very critical warning call,” adding, “because of supply management, we were able to stabilize the market. We cut production and brought profitability back into the market.”

Canadian chicken farmers grew one-percent less chicken in 2009 than 2008, Fuller said.

At the WTO only 20 per cent of the “modalities,” the rules that will govern the next round of liberalized trade remain to be negotiated, he said, commenting, “I don’t see anything happening at the WTO in the near future over the next two to three years.”

 Interprovincial Movement

The interprovincial movement of chicken will remain an issue for the Chicken Farmers of Canada in 2010, CFC Chairman David Fuller told the joint meeting the Chicken Farmers of Nova Scotia and the Nova Scotia Turkey Producers Marketing Board.
“We have been told by the provincial (boards) you (CFC) deal with this issue or we will have to,” Fuller said.
He described this concern as “an implication” that flows east and west across Canada arising from the ongoing dispute between Quebec and Ontario over interprovincial poultry shipments in central Canada.
Fuller also said differential growth (which Nova Scotia doesn’t support) also remains as an issue for discussion at the CFC table this year.
There was also increased tension between the Farm Products Council of Canada and the CFC, he said, over the allocation of the production base between the provinces.
The FPCC initially declined to set the allocation for the A-93 production period, then reconsidered and approved it after setting the A-94 allocation. Without that approval, Fuller observed CFC would have had no authority to monitor or oversee production in the provinces, or issue a levy on over quota production.
He reported the CFC has filed for two judicial reviews in the courts over the FPCC’s handling of base allocation, an action that has also been joined by six provinces, including Nova Scotia.

  

Canada is now negotiating trade agreements with 12 other countries, including the EU, Fuller said. “Right now you have 600 bilateral trade agreements being negotiated. That tells me people have given up on the WTO.”

There is growing international food insecurity, claimed Mike Dungate, CFC General Manager. “There has to be a
recognition food is different in the international trading system. It is not like other products.”

Dungate added CFC has lawyers looking at the international obligations countries have entered into on trade, stating that globalization of trade is increasingly being questioned.

On Tariff Rate Quotas (TRQs), Canada has committed itself to the 13 per cent rule on value- added products where a product that has 87 per cent chicken content can be deemed not to be chicken, said Dungate, remarking that new products and convenience foods are where money will be made through value-adding.

Along with an evolution in packaging, he continued to say that the market is moving to fresh, prepared products from fresh, raw products which presents a problem because a new product category has been created that can circumvent Canadian TRQs.  In 2009, chicken imports were expected to come in at three million kilograms over the quota, instead they entered at seven million kilograms above the quota.

Dungate observed: “This came at a time when production is being cut.”

He expected up to 13 million kilograms of chicken will be imported this year. “This is a significant erosion of our market.”

Dungate called for an Article 28 action by the federal government at the WTO. “They did it for dairy.”

Compensation
The Canadian poultry industry has begun a joint examination with the Minister and Deputy Minister of Agriculture and Agri-Food Canada of the Health of Animals Compensation Acts, said Laurent Souligny, EFC chairman, to look at the compensation for culling birds to control a disease outbreak.

Souligny declared: “Our staff and the Minister’s staff are working on achieving new numbers. Eight dollars a bird is not enough.”

Sateesh Singh, Turkey Farmers of Canada’s manager of policy and trade, added that he hoped by June they would have something on compensation for flock destruction that will be acceptable for the industry which also intends to have a consistent policy on animal health care across Canada.

Souligny also noted that the industry now has two traceability projects, one in the Maritimes and the other in the western provinces. He stressed it is important to work on this trace back issues from the consumer to the farm.