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Canadian Agriculture and Agri-food Policy


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Title: Canadian Agriculture and Agri-food Policy

Canadian Agricultureand Agri-food Policy
Conference on the Food EconomyOctober 17-18,
2007The Netherlands
Objective To describe Canadas experience in
developing Agriculture and Agri-food policy that
responds to current challenges
  • The Canadian Agriculture and Agri-food Sector
  • Current Challenges and Opportunities Facing the
  • Agricultural Policy Framework
  • Evolution of Canadian Agriculture and Agri-food
    Policies and Lessons Learned
  • APF-Environment
  • APF-Science and Innovation
  • APF-Renewal
  • Growing Forward Canadas Future Agricultural
    Policy Framework

The Canadian agriculture and agri-food system is
a dynamic chain of industries that is
increasingly integrated and contributes
significantly to the Canadian economy
  • In 2006, the food systemaccounted for 8 of
    total GDPand 1 in 8 jobs
  • Players in the food supply chain

    have become increasingly

  • The sector has become

    increasingly export-oriented,

    with the growth
    in exports mostly

    driven by value-added products,

    which account for 65 of the total
  • As a small open economy,remaining competitive is
    key tofuture performance of the industry

The industry is facing various challenges, which
continue to shape the structure and performance
of the sector
  • Challenges
  • Technological change
  • Emerging low cost competitors
  • Changing consumer and market demands
  • Increased use of non-tariff barriers
  • Exchange rate appreciation
  • All players in the sector have been adjusting
    through structural change
  • While food processors managed to keep profits
    stable, primary producers
  • experienced decline in real income

Challenges to the Sector
Canadian agriculture and agri-food policies have
also been evolving in response to these challenges
  • Pre-1990s
  • This was the pre-WTO (GATT) period
  • Commodity-based programs focused on price and
    income stabilization
  • Policies responded to the challenges of the time
  • Oil crisis of the early 1970s
  • Uncertainty of supplies
  • Large fluctuations in prices and high variability
    of producer and processor revenues
  • Policies have created strong entitlements
  • Transportation subsidy for Western grains and
  • Legacy of 1890s when objective was to protect
    national interest and encourage immigration
  • Encouraged monoculture (wheat) and exports on
    Prairies and discouraged value-added production
  • In Canada, and elsewhere, support payments were

Evolution of Canadian Food Policy
Canadian agriculture and agri-food policies have
evolved in response to these challenges
  • The 1990s brought
  • about significant
  • changes
  • Negotiated free trade

    agreement with U.S. in1989 the WTO
    Agreementon Agriculture and NAFTA

    in early 1990s
  • Programs in general shiftedto decoupled payments
    andto a whole farm approach
  • Canada eliminated trans-portation subsidies in
  • All these resulted in
  • Further restructuring, particularly in food
    processing to meet NA product mandates
  • Increased diversification and value added

Evolution of Canadian Food Policy
Canadian agriculture and agri-food policies have
been evolving in response to these challenges
  • 2002 marked the beginning of a new policy era
  • The APF Vision
  • Securing the long-term prosperity and success of
    the agriculture and agri-food
  • sector by being the world leader in food safety,
    innovation and environmentally-
  • responsible production
  • The APF aimed at facilitating the agriculture and
    agri-food industry to
  • Better manage market risks
  • Improve FSQ standards and help producers
    communicate quality in domestic and international
  • Encourage environmentally sound production
  • Adapt to new market opportunities and face
    challenges through innovation and science

Evolution of Canadian Food Policy
Five policy pillars were identified under the APF
  • Food Safety and Quality to make Canada the world
    leader in production, processing and distributing
    safe and reliable food
  • Environment to help producers as resource
    stewards, and to respond to consumer demands
    regarding environmental performance
  • Renewal to help farm families develop skills to
    succeed in the knowledge-based economy
  • Science and Innovation to support sustainable
    development, and innovation that generates
    profit, and to instill confidence in food safety
    and quality
  • Business Risk Management to encourage producers
    to be proactive to reduce business risks
  • Policy pillars were linked to the goal to improve
    Canadas international
  • competitiveness and trade, and to remain
    compliant with international agreements
  • Steady industry input was secured through a Value
    Chain Round Table process

Agricultural Policy Framework (APF)
The Food Safety and Quality program aimed to
facilitate industry develop and implement
government-recognized food safety, quality and
traceability systems from field to fork
  • Program elements focused on
  • System development throughout the entire food
    chain, including on-farm HACCP, for
  • Food safety
  • Food quality, and
  • Traceability
  • On-farm implementation of these systems
  • Outreach and training for industry players to
    facilitate the uptake of these FSQ initiatives

APF Food Safety and Quality
Industry has been an active participant in FSQ
program development at the national level
  • Two outcomes in particular are worth mentioning
  • The Canadian Cattle Identification Program
  • Industry-led
  • 95 of cattle were registered
  • Put Canada ahead of most other countries.
  • Mandatory National Organic Standards introduced
    in July 2007
  • Standards were developed by Canadian General
    Standards Board with industry participation
  • Initially were implemented as voluntary standards
  • In order to resolve some of the market access
    issues and to protect consumers and organic
    producers from fraudulent claims, standards were
    made mandatory
  • Enforcement of the standards stays with CFIA

APF Food Safety and Quality
The Environment program aimed to achieve
environmental sustainability and to monitor
  • The Program provided
  • Research for the development of beneficial
    management practices (BMP)
  • Science-based standards to identify environmental
    targets and monitor sustainable practices
  • Environmental information for better land use
    planning and management
  • A suite of programs were introduced to inform the
    industry about improved land-use management,
    assess the current situation and adopt
    environmentally sound practices
  • Programs such as Environmental Farm Plans (EFP)
    and Greencover were introduced to encourage
    sustainable practices
  • Significant progress was made on many fronts,
    such as
  • High levels of provincial participation in
    helping farmers develop EFP and learn about BMP
  • Greencover encouraged the conversion of marginal
    farm land to permanent cover and had achieved
    44.4 of target by March 2006

APF Environment
The Renewal program was aimed at providing
producers with access to information, skills,
knowledge and advisory services to improve farm
business management
  • Program elements included
  • Specialized Business Planning Services
  • Farmers were given advice in developing plans for
    their farm operation, including succession,
    marketing, business or other specialized plans
    and help with Farm Debt Mediation
  • Feasibility studies for on-farm value-added
  • Access to financial resources to pursue further
  • Surveys indicate that users of these programs
    were satisfied with them

APF Renewal
The Science and Innovation program aimed to
improve the competitiveness of the industry
through technological advancement and innovation
  • The Science and Innovation pillar included two
  • The realignment of public sector RD resources in
    science including the development of
  • An Intellectual Property Rights strategy
  • Bio-based RD platforms with external partners
  • Programs to strengthen market chain linkages and
    encourage the adoption of new innovations
    (commercialization) including
  • The Broker Program, aimed at bringing people and
    organizations together to foster innovation
    opportunities and facilitate coordination through
    the value chain with a shared vision of
    developing new products
  • The Agri-Innovation Program, aimed to provide
    financial support to advance initiatives
    including the ones identified through the Broker
  • Accomplishments
  • Programs helped accelerate the development of a
    wide range of new industrial, health and
    nutritional products obtained from plants,
    animals and micro-organisms, including Flax 2015
    and Soy 20/20

APF Science and Innovation
Further investments have been made since the
Science and Innovation programs were designed
  • Further investments have been made to promote RD
  • commercialization of bio-products and bio-fuels
  • Agricultural Bioproducts Innovation Program,
    aimed to promote research, development,
    technological transfer and commercialization
    activity in agricultural bio-products through
    research networks
  • Agri-Opportunities Program which supports
    commercialization of new products
  • Bio-fuels Opportunity for Producers Initiative,
    which was designed to provide farmers and rural
    communities with opportunities to participate in
    and benefit from increased Canadian bio-fuel
  • eco Agricultural Bio-fuels Capital Initiative
    provides capital for constructing or expanding
    bio-fuel production facilities

APF Science and Innovation
The Business Risk Management (BRM) program was
aimed at helping farmers better manage the risks
and profitability of their operations
  • Main Program elements included
  • The Canadian Agricultural Income Stabilization
    (CAIS) Program integrates stabilization and
    disaster protection into a single program,
    helping producers protect their farming
    operations from income variability
  • Shared with the provinces on a 60-40 basis
  • A whole-farm program available to eligible
    farmers regardless of the commodities they
  • Farmers have discretion in choosing the level of
    protection under CAIS
  • Production Insurance, which is administered by
    the provinces, provides coverage against
    variability in yields
  • Several unanticipated events affecting
    agriculture markets over this period led to
    higher than expected BRM expenditures

APF Business Risk Management
The APF Lessons Learned
  • Better links are required to balance across
    various policy pillars
  • Implementation of the non-BRM elements of APF has
    been slow
  • Involvement of and cooperation across all levels
    of government and industry have been, and
    continue to be, crucial in the development of the
  • The APF helped the sector and governments focus
    on meeting consumer and
  • market demands, through innovation, food safety
    and quality systems and
  • environmentally responsible production practices,
    while managing economic
  • performance

The APF Lessons Learned
Based on the experience from APF, the new policy
framework, Growing Forward tries to better
link and balance its three policy goals
  • Vision
  • A profitable and innovative agriculture,
    agri-food and agri-based
  • products industry that seizes opportunities in
    responding to market
  • demands and contributes to the health and
    well-being of Canadian
  • The three policy goals are
  • Competitive and Innovative Sector
  • A Sector that Responds to SocietysPriorities
  • A Sector Proactive in Managing Risks

Growing Forward
A Competitive and Innovative Sector
  • Canada will have an agriculture, agri-food and
    agri-based industry equipped to compete
    successfully in domestic and international
    markets, innovate, adapt to change and seize new
    opportunities, thereby achieving sustained growth
    and profitability
  • The policies will focus on
  • Fostering a better business climate
  • Improving market access
  • Encouraging innovation
  • Streamlining regulations
  • Investing in public infrastructure

Growing Forward
A Sector that Responds to Societys Priorities
  • Canada will have an agriculture, agri-food and
    agri-based products industry that generates
    benefits for the sector and all Canadians,
    ranging from food safety to environmental
    sustainability to health and wellness.
  • The policies will focus on
  • Enabling the sector to meet societys priorities
    on FSQ and environmentally responsible production
    while securing the performance of the industry
  • Modernizing and implementing appropriate
    regulations and standards
  • Strengthening capacity of FSQ systems
  • Enabling the sector to respond to increasing
    consumer demand in the area of health and
    wellness products
  • Facilitating full chain tracking and tracing

A Sector Proactive in Managing Risks
  • Canada will have an agriculture, agri-food and
    agri-based products industry that is well
    equipped to manage and mitigate risks that
    impinge on the profitability of enterprises and
    sector prosperity
  • Policies will focus on
  • Safeguarding the safety and security of animals
    and plants
  • Safeguarding the future sustainability of land
    and water resources
  • Creating incentives for industry to invest in
    risk mitigation
  • Tools to mitigate financial risks

Growing Forward
In conclusion
  • Both external and internal factors have played a
    significant role in the evolution of agriculture
    and food policy in Canada as well as on the
    structural adjustments of the sector
  • The result has been a sector that continuously
    adjusts, has become increasingly export-oriented
    and productive and interdependent on other
    players in the supply chain
  • The sector will continue to face new challenges
    requiring a continuous need for revisiting and
    revising policies
  • Two major lessons from Canadas recent experience
  • Policy changes, to be effective and successful,
    need to be undertaken in consultation with all
    players in the sector
  • It is crucial to have the regulatory and
    institutional structures in place that are
    conducive to achieve the desired outcomes of new
  • The new Policy Framework puts a lot of emphasis
    on these two issues

For an Overview of the Canadian Agriculture and
Agri-food Systemgo to http//