Market Access Priorities Presented to Senate Standing Committee
Soy Canada recently spoke to the Senate Standing Committee on Agriculture and Forestry about the Canadian soybean sector’s top challenges related to international market access.
Here is the text of the presentation given by Soy Canada Executive Director Jim Everson by April 21, 2016:
Good afternoon Senators. It is a pleasure to be here with you today to introduce Soy Canada and share some of the soybean industry’s key priorities as they relate to international market access.
First, let me begin by saying who we are and what Soy Canada represents.
Soy Canada is the national association representing the full soybean value chain. Our members include producer associations representing soybean farmers across Canada, seed development companies, soybean exporters and soybean processors. Soy Canada facilitates industry cooperation and represents the industry on domestic and international issues affecting the growth and development of soybeans.
The soybean sector in Canada is growing significantly.
We are now in our 8th consecutive year of soybean production growth:
- Between 2005 and 2015, seeded area of soybeans in Canada increased by 87 percent to 5.1 million acres.
- Since 2005, production levels have nearly doubled to 6.2 million metric tonnes in 2016.
- Farm cash receipts for soybeans are $2.3 billion.
- Finally, since 2005, soybean exports have increased by roughly 250 percent to 4.4 million metric tonnes in 2015. Canada exports about 65 percent of its domestic soybean production.
We are the world’s 5th largest exporter of soybeans and the 7th largest producer.
The industry’s contribution to the Canadian economy is also substantial.
Domestic use, processing and export of Canadian soybeans contribute over $5.6 billion to Canada’s annual GDP and are linked to over 54,000 direct and indirect full-time jobs. We are a growing segment of the agriculture industry with more expansion forecast for the coming years and more reliance on export markets. This is why market access is critical to our industry.
There are a number of market access priorities for all segments of the soybean value chain. I will take some time to quickly identify seven priorities for us.
First, Soy Canada is a strong proponent of rules-based, liberalized trade.
Canada is a trading nation and our grains and oilseeds sector is heavily reliant on international markets. But in many commodities, while access to export markets is very important, we do not have the size and export might of competitive nations. Soybeans are an illustration of this. Despite the rapid growth of our sector, Canada represents only about 2-3% of production internationally. Our industry competes with the US, which produces about 39% of the world’s soybeans, and Brazil, at about 37%. They are responsible for the vast majority of world trade, which gives them considerable leverage in commercial negotiations. Trade agreements with agreed rules maintain fair trade.
Second, market access for the soybean sector revolves around science-based regulations and policy.
Our growth is based on innovation. Policy and regulation need to be rooted in science and evidenced-based decisions. We need a predictable environment where all participants play by the same rules. Predictable, rules-based trade levels the playing field for our industry. International trade agreements seek to establish these rules and support existing trade regulations in other WTO agreements.
Third, is a new Agriculture Policy Framework.
Agriculture Policy Frameworks are five year agreements involving both federal and provincial governments, which establish priorities for government action and support. They are valuable in aligning governments and industry to a common set of priorities. We are pleased to see the government work on developing the next framework slated for 2018.
Fourth is the approval process for products and biotechnology.
A major market access issue for our industry is the lack of adequate assessment times of the latest biotechnology traits in key export markets. The Government of Canada plays a vital role in this process and must continue to promote expeditious consideration of biotech applications in large export markets, especially China and the European Union. Without this support, biotechnologies that help by providing new tools to producers are vulnerable to political decision making processes that impede production and export opportunities.
Our industry is respectful of the approval processes in other countries and continues to work within their regulatory frameworks. We need quicker biotechnology approvals within these systems that ultimately help get more Canadian goods to market faster.
Next, and related to biotechnology approvals, is the issue of Low Level Presence.
Low level presence refers to the very low, unintentional presence of GM materials, that have been deemed safe by a full safety assessment, in commodity grain shipments internationally. It is a very topical issue in the international grain trade as a result of the growing acreage and number of agriculture products being assisted by biotechnology methods. Canada has taken a leadership position in developing new regulatory approaches to managing LLP in international bodies and agreements.
Sixth is providing adequate resources for government market access services.
The work done by the Canadian Food Inspection Agency, Agriculture Canada, and Global Affairs is extremely valuable to our sector. These organizations play a critical role in supporting the soybean industry, with branches such as the Market Access Secretariat keeping our sector informed and facilitating our needs overseas. Similarly, the Trade Commissioners provide exceptional service and have been helpful in the planning of trade missions in key export markets around the world.
However, the number and complexity of market access and trade issues is growing and as our exports grow, our reliance on government agencies, especially CFIA, also increases. They need to be adequately resourced.
Finally, rail transportation is a priority.
All commodities will increase production in the coming years. In order to increase market access, the soybean sector is dependent on strongly coordinated, affordable and service-driven railway systems. As the production of soybeans continues to grow year after year, our sector needs to proper infrastructure to support demand well into the future. Reliable transportation is an important component to market access that continues to be a priority for us.
In conclusion, I thank the Senate committee for providing Soy Canada with the opportunity to identify many of the top market access priorities for the soybean sector and listening to our concerns on this important topic.