Our November / December issue by Meat Business Pro

November/December 2017

NAFTA AND THE UNSETTLING OF THE AMERICAN FARM ECONOMY

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Canada without its big brother? By Chuck Jolley

NAFTA and the Unsettling of the American Farm Economy By Scott Taylor

The U.S. is Out, but 11 other countries sign TPP By Scott Taylor

Meat and poultry prove their worth as versatile proteins By Sean Moon

Five Minutes with Canadian Meat Council’s Ron Davidson and the New TPP By Chuck Jolley

Agriculture contributed $111 billion to Canada’s GDP in 2016 Fawn Jackson Q&A: Sustainability is Really Coming Now By Cam Patterson

23 24 26 28 31 32 33

Canadian Agricultural Partnership: Setting the foundation for our farmers and food processors Six reasons to join the Canadian Beef Sustainability Acceleration Pilot FCC reports see growth for Canada’s agriculture exports China’s pig farmers go north, upending world’s top meat, grain market MacAulay wraps up successful China agricultural trade mission Tug of war is on in Canada’s hog sector By Phil Franz-Warkentin

Looking back, Canadian entrepreneurs might call 2017 “the year of uncertainty” By Marilyn Braun-Pollon

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2016

GUEST EDITORIAL

September/October 2017 Volume 16 Number 5

CANADA BRINGS EAST CANADA 150 WITHOUT AND WEST TOGETHER ITS BIG BROTHER? LITERALLY By Chuck Jolley

PUBLISHER Ray Blumenfeld ray@meatbusiness.ca MANAGING EDITOR Scott Taylor publishing@meatbusiness.ca DIGITAL MEDIA EDITOR Cam Patterson cam@meatbusiness.ca CONTRIBUTING WRITERS Scott Taylor, Chuck Jolley, Dan Kelly, Ronnie P. Scott Taylor, Chuck Jolley, Sean Moon, Marilyn Cons, Sara Place, Amy Reid

Braun-Pollon Phil Franz-Warkentin

CREATIVE DIRECTOR Christian Kent Canadian Meat Business is published six times a year by We Communications West Inc.

Throughout the twentieth century and the first decade-and-six of the twenty-first, Canada has relied on its big brother to the south to help shape In of the country’s 150th Canada Beefplayer and Fairmont itshonour economy. No shame in that, the birthday, U.S. has been the major in the Hotels Resorts joined forces to celebrate how Canada’s cultural world’sand economy for about three fourths of that time. In North America, what Washington has decided to do absolutely ruled the financial roost. diversity has influenced the evolution of our cuisine. But Trump administration has walked awayFairmont from oneRoyal economic At a the recent event, Canada Beef and Toronto’s York gold highlighted mine andinfluence stands ready to abandon another. With Trump walk-out, theChef the Asian in Canadian cuisine featuring thethe Royal York’s Executive Trans Pacific Partnership (TPP)Zhu has from been Shanghai. reduced from world’s largest to Robert Mill’s and Chef Clinton Chefthe Mills’ commitment trading blockand to just another interesting association of eleven tradinggrown partners. sustainability sourcing local set the stage to showcase Canadian and Now, beef he’s taking dead aim at the long-standing North American Free Trade raised and produce. Agreement (NAFTA), throwing some unacceptable requirements into the mix

The day began with a farm tour, bringing east and west together. Professional home and daring Canada and Mexico to call his bluff. economist and author Mairlyn Smith guided a group of top culinary media and Understanding that markets on abhor and that Trump is the master influencers as they embarked a fulluncertainty day of epicurean exploration, delving into of that dodgy art, it might be time for Canada to just say no to their historic the narrative of taste and terroir. Much like wine, the characteristics of Canadian tightare entanglements theeffect. U.S. Over the years, his business partners have beef shaped from awith terroir

learned that when Trump talks himself into a corner, as he has with NAFTA,

At Farm,out near Caledon, Ontario.heAlberta rancher Kelly Smith-Fraser heSunnymead does not come willingly. Admitting was wrong and reversing joined Will Sheard of Sunnymead and shared the stories of how theythan raise direction does not come easily to him. Better to run the ship aground to Canadian beef. The farmer and rancher pair offered an insider’s perspective on the change course. similarities and differences in raising beef across the country.

With Trump’s continuing work to disentangle the U.S. from its multi-lateral

While feeding and housing cattlethem can with be quite different deals between trading agreements to replace one-by-one withthese moretwo parts ofcountries the country, areexisted, significant. “WeCanada do the very we can thanthe he similarities realized ever should quit best spending sofor our livestock andlooking are continually methodsand withwork our animals’ land’s much time south foradvancing economicour leadership harder atand forging best in mind,” Smith-Fraser. moreinterests of its own deals,said completely independent of the U.S.? The strength of at

We Communications West Inc. 106-530 Kenaston Boulevard Winnipeg, MB, Canada R3N 1Z4 Phone: 204.985.9502 Fax: 204.582.9800 Toll Free: 1.800.344.7055 E-mail: publishing@meatbusiness.ca Website: www.meatbusiness.ca Canadian Meat Business subscriptions are available for $28.00/year or $46.00/two years and includes the annual Buyers Guide issue. ©2015 We Communications West Inc. All rights reserved. The contents of this publication may not be reproduced by any means in whole or in part, without prior written consent from the publisher. Printed in Canada. ISSN 1715-6726

least two major industries - automobiles and agriculture - might on it. Sheard summed it up. “People ask me why I farm – and one of thedepend main reasons Recent negotiations prove those efforts can benefit the Canadian economy. is that 97 per cent of farms are still family run. I feel blessed to work with my dad every dayyears and learn of raising good quality beef like my grandparents Several ago,the thecraft Canadian Cattlemen’s Association noted that tariffand my grandparents did.”beef in Japan “remains a subject of interest in freegreat access for Canadian termsand of the Trans-Pacific Partnership andinalso the Japan-Canada Economic Grass grain-fed beef went head-to-head a terroir tasting experience, before Partnership Agreement (J-CEPA).” With the U.S. now out of the TPP, the and guests indulged in a gourmet picnic packed up in bento boxes with beef prospects for greatly expanded seasonal, regionally grown foods. trade in Canadian beef just entered the realm of certainty. Japan’s loss of interest in finalizing J-CEPA might mean that

Back at the Fairmont Royal York, guests treated to a Canada 150 exclusive agreement is permanently off the table,were though. maple whiskey cocktail and Chef recipe demo of smoked brisket and braised beef The CCA also said this about then-Prime Minister Stephen Harper’s short rib. For the grand finale, guests were treated to an East meets West themed announcement that Canada and the Republic of Korea had reached a free dinner where the Chef duo presented different preparations of beef, reflecting trade agreement, the first between Ottawa and an Asian country. “Under the unique cultural influences. Dishes like Yonge Street Sirloin with Gremolata and terms of the agreement, the 40 per cent Korean tariff on fresh and frozen beef Mushroom, Oven Roasted Orange Beef Tri-tip with Shanghainese Sauce and will be fully eliminated in 15 equal annual steps and the 18 per cent tariff on Charred Sirloin Roll with Pickled Asparagus were all part of the event, showcasing offals will be fully eliminated in 11 equal annual steps.” the hard work of Canada’s farmers and ranchers.

As part of the agreement, Canada will eliminate 97.8% of its tariffs for

“I am thrilled to be part of such a unique series of events connecting chefs and goods imported from South Korea, and South Korea will eliminate 98.2% paying tribute to high quality ingredients like Canadian beef,” said Chef Zhu. “Once of its tariffs for goods imported from Canada. More specifically, Canada will we take the time to get to know where our food comes from and how it is crafted, eliminate tariffs on imported South Korean automobiles within two years of we can truly appreciate its beauty.”

ratification and South Korea will eliminate a 40% tariff on imported Canadian

“In working our global partners, we’re exploring how Canadian beef withinwith 15 years of ratification. The agreement hadfar anthe effective datepantry of January 1, 2015. has come,” said Joyce Parslow, Executive Director of Consumer Relations at Canada Beef. “To continueCanada pushing culinary boundaries, we’re of working with For a century-and-a-half, has been labeled the country the future, international chefs and pairing them with leading local chefs to demonstrate how a nation with huge potential. With the U.S. under Trump taking a new look at Canadian ingredients have earned a reputation global stage. In building its dominant world position and how it should on - orthe should not - go forward, these relationships, we aim to inspire Canadians to continue expanding their the opportunity to fulfill that prognostication seems to be here, now. pantries, embracing global flavours in their daily cooking.” Chuck Jolley is the President of Jolley & Associates and is a respected writer, editor,

publisher public relations expert with more than 25 years experience in the meat and For more and information, visit canadabeef.ca. poultry industry.

meatbusiness.ca meatbusiness.ca

September/October 2017 CANADIAN MEAT BUSINESS 5

NAFTA AND THE UNSETTLING OF THE AMERICAN FARM ECONOMY By Scott Taylor

As the United States moves on chaotically under the pressure of President Donald Trump’s executive order pen, it is beginning to appear as if some of his most loyal followers will be hurt the most by his decisions. The Caucasian American farmer voted almost exclusively for Trump (at least 80 per cent) in 2016 and today, Trump’s policies (or lack of policies) are doing more to destroy the American farmer -- whether he’s Caucasian, African-American or Hispanic – than make his life and his business better. According to farm author Ted Genoways in the Washington Post and, with statistics obtained from the United States Department of Agriculture, prices for corn (a modern low of $3.40 per bushel) and soybeans ($9.80 per bushel) are so low that it now costs a farmer more to grow the staples than the amount for which they can sell it. In fact, according to Genoways, “Soybeans, which surged in planted acres when corn prices went into free fall, are now below $10 per bushel, beans are trading at less than two-thirds of their price of just a few years ago.” Meanwhile, U.S. Department of Agriculture statistics clearly suggest that while farm income has been cut nearly in half in the past four years, farm debt has increased by more than a quarter — with projections that it could “surpass $390 billion in 2017,” the highest level since the farm crisis in the 1980s. As a result, farmers are taking out more and more loans. Unless something is done, more farms will be sold at auction and fewer farmers will be able to afford to work the land. As Genoways wrote in the Washington Post on Oct. 24: “In short, Trump wants to slam the door on trade while also kicking out the supports for farmers and rural communities. There’s no way around it: The policies he is pushing will devastate the American farm.” Which brings us to NAFTA – the North American Free Trade Agreement, which was officially ratified in 1994. On the campaign trail, Trump said he would either tear up NAFTA or “renegotiate it.” He was either going to make it “a better deal” for the United States or there would be no deal at all. On Nov. 17, the fifth round of NAFTA re-negotiations will begin in Mexico City and things don’t look rosy. At least, 6

for anyone other than Donald Trump. In fact, as Trump moves closer to tanking the U.S. farm economy, he has NAFTA in his protectionist sights. Now, to be fair, one must look at NAFTA as more than an agreement that affects farmers and ranchers. Its reach is wide and includes a myriad of trades and businesses that involves everything from manufacturing and shipping to immigration and border security. So as we, in the Canadian meat business look at the effects of the agreement, we must also take into consideration the other aspects of this tri-lateral treaty. This is a deal that is extremely important to the meat industry in Canada. For example, Canada exports both beef in a box as well as live cattle to the United States and Mexico. We do nearly $3 billion worth of business to the U.S. (about $0.90 worth of beef per person in the United States), split almost evenly between butchered and processed beef (or beef in a box) and live cattle. With Mexico, we exported a little more than $100 million last year. Meanwhile, the Americans ship nearly $1 billion of beef into Canada (almost $4.00 worth of beef per Canadian). That means NAFTA is a deal that’s beneficial for everyone. That said, after the fourth round of negotiations during the summer, Canada’s Foreign Affairs Minister, Chrystia Freeland and U.S. Trade Representative, Robert Lighthizer, Trump’s hand-picked negotiator, stood on a stage and had an uncomfortable and awkward public exchange. “The ‘win-win-win’ that Vice-President Mike Pence claimed to be seeking cannot be achieved with a winner-take-all mindset or an approach that seeks to undermine NAFTA rather than modernize it,” Freeland said. “We have seen a series of unconventional proposals in critical areas that make our work much more challenging. In fact, there are some proposals being made that would turn back the clock on 23 years of predictability, openness and collaboration under NAFTA.”

Lighthizer answered by ripping Canada and Mexico for what he called a “resistance to change.” “They were fighting to preserve one-sided benefits enjoyed by their companies and refusing to endorse policies they agreed to as part of the Trans-Pacific Partnership deal that Mr. Trump killed,” said Lighthizer. Freeland claimed that the collapse of the agreement “did not appear imminent.” However, all three countries admitted in their joint statement that there were “significant conceptual gaps” among them. “I continue to hope for the best,” said Freeland. “But we will prepare, in a no-fuss Canadian way for the worst possible outcome.” Freeland has already admitted that there are major gaps between Canada/Mexico and the United States on five issues – none of which involves meat production, the supply chain or the ability of farmers and ranchers to work together. The issues to which Freeland referred are automobiles, dairy, government procurement, dispute resolution, and the “sunset clause,” a caveat the United States wants to insert into the agreement that would automatically terminate the deal in five years “if a new endorsement from all three countries is not agreed upon.”

Originally, Trump and his negotiators wanted a new deal in place – or no deal at all – by the mid-term elections of 2018. It doesn’t look like that will happen and Freeland is pleased the United States has agreed to dump its wham-bam-thank-you-ma’am schedule. Freeland, who admits she clearly understands the all-or-nothing approach of the Americans for the political hot-potato that it is, she has also decided that by changing their negotiation schedule, they are indeed, prepared to negotiate. “What this says to me is something quite significant,” she said. “There is goodwill in all parties, a real willingness to roll up our sleeves. Our government remains committed to sticking out the talks. A mere three months have passed since the start of the process, which is a nano-second by the standards of trade negotiations.” However, the Americans are still worried about the length of the talks heading into 2018. A Canada-U.S. trade lawyer named Dan Ujczo, who works for Dickinson Wright Attorneys in Columbus, Ohio, told the Toronto Star recently that he doesn’t believe the U.S. negotiators will allow the talks to go much past the next two scheduled sessions.

continued on page 8

“The more days and weeks we let pass by, that 2018 political calendar becomes almost impossible,” he told the Star. “We have to use this month constructively, because there’s really no time on the back end. I don’t see how any trade deal can be announced in the winter of 2018 in the middle of primary season.” The differences between Canada and the United States can be traced directly to Trump’s concern about “trade deficits.” Trump believes the United States is “losing,” although economists would argue that trades deficits or surpluses have absolutely nothing to do with winning or losing. Especially when it comes to Canada. After all, Canada has 35 million people, the United States has 325 million people and while Canada might export more to the U.S. in total, it is significantly less per capita.

“ MAKING A MORE BUSINESS-FRIENDLY

ENVIRONMENT FOR U.S. FARMERS AND RANCHERS TO OPERATE IN, WE AGREE WHOLEHEARTEDLY IN THOSE EFFORTS,” SAID PAUL DEFOOR, COEXECUTIVE DIRECTOR OF CACTUS FEEDERS. “BUT IN THIS ONE, I’M NOT SURE THEY’RE SEEING OVERALL ECONOMIC IMPACT CLEARLY.”

“For us, trade deficits do matter,” said Lighthizer, who knows the United States is actually in a per-capita trade surplus position with Canada. “And we intend to reduce them.” The comment, like so many from the Trump administration, makes little to no sense. And that is the heart of the problem. Too much of these hard-nosed negotiations make no sense for negotiators or even for many of the people who voted for Trump. According to the U.S. Department of Agriculture, roughly one-third of the American farmer’s combined corn and soybean harvest plus beef, pork and poultry products are shipped to other countries – Canada and Mexico included. Farmers who voted for the current president, told the Washington Post that they were “heartened by Trump’s reputation as a hard-nosed negotiator, a businessman renowned for his skill at the art of the deal, who could strong-arm trading partners into paying higher prices for American commodity grains.” However, Trump is once-again threatening to withdraw entirely from NAFTA, which might lead to higher prices but will also result in higher tariffs. According to more than one farm lobbying organization, market analyst and trade expert, that

would be absolutely disastrous for farmers. Bad enough that Trump already killed a great opportunity for farmers with the Trans Pacific Partnership, he’s now on the verge of destroying North American markets for U.S. farmers and ranchers. After all, pulling out of agreements and potential agreements with the Pacific Rim has devastated commodity prices this year. When he pulled out of the TPP, the American Farm Bureau Federation blasted him. The AFB had estimated that the TPP would have raised net farm income by $4.4 billion per year and added more than 40,000 jobs, mostly in rural areas. Of course, Trump responded by threatening to cancel the U.S.-Korea Free Trade Agreement, calling it “a horrible deal.” The American Soybean Association immediately denounced Trump: “This decision, if carried through, will have disastrous consequences for the nation’s soybean farmers.” Trump backed off, but said the United States could remain in the pact as long as there was a total overhaul, which angered ASA President Ron Moore, who said, “Even the threat to withdraw from this or any trade agreement is a dangerous course of action.” Meanwhile, American cattle ranchers aren’t particularly happy with Trump these days, either. As an example, in Texas, where nearly 90 per cent of the farm community voted for Trump, the Texas Cattle Feeders Association wrote the following: “As talks continue to renegotiate the North American Free Trade Agreement — called the “worst trade deal ever” by President Donald Trump — area economists, farmers and ranchers are hopeful but nervous about the deal’s future. Texas Panhandle observers worry about a withdrawal from the agreement leading to tariffs on trade that would stifle Texas Panhandle grain exports, disrupt the flow of cattle into the region’s feed yards and hurt the Amarillo area economy. The end of NAFTA could hurt feedlot capacity, said Steve Amosson, area economist for Texas A&M AgriLife Extension Service. The panhandle markets roughly 5.5 million head of fed cattle a year, he said. Amosson said that supply is kept up by an estimated 500,000 and 750,000 stocker cattle that come across the U.S.-Mexico border and into Texas Panhandle feedlots each year. “Making a more business-friendly environment for U.S. farmers and ranchers to operate in, we agree wholeheartedly in those efforts,” said Paul Defoor, coexecutive director of Cactus Feeders. “But in this one, continued on page 10

meatbusiness.ca

9 July/August 2017 CANADIAN MEAT BUSINESS 19

I’m not sure they’re seeing overall economic impact clearly.” Cactus Feeders’ beef division employees about 500 workers and produces about one million head of cattle a year, Defoor said. The price for finished beef cattle that come out of the feed yards is $1.10 a pound, working out to about $1,400 a head Defoor said. About $300 of that can be attributed to export demand, he said. “If we damage that and (our) trading relationship with Canada and Mexico, it would hit us pretty hard,” Defoor said. “I’m not sure how we would make it up.” “I don’t want to say catastrophic. That might be a little too strong. But it would be detrimental to our company as well as to the economy of our three-state region.” Ross Wilson, president and CEO of the powerful Texas Cattle Feeders Association, has called NAFTA “one of the greatest success stories in the history of U.S. agriculture.” And that story, from the Texas Cattle Feeders, is just one of many in the United States. NAFTA has worked for American farmers and ranchers and, indeed, if the November talks bring an end to the Agreement, the United States rancher will suffer dramatically. However, as the soybean lobbyists saved the U.S.Korea partnership (at least for now), there are other groups in the United States who are working to save NAFTA. That’s certainly the belief of John Masswohl, the Canadian Cattlemen’s Association’s government and international relations liaison. He spends the majority of his time as the voice for the Canadian beef industry to both the Canadian and U.S. governments, as well as maintaining international relations around the world. Masswohl joined the CCA after previously working closely with the Canadian beef industry as Agriculture and Trade Counsellor with the Canadian Embassy in Washington, D.C.  He is experienced enough to understand clearly that despite all the talk in Washington – talk that seems to be going off in all directions -international trade has never been in as good a place as it is today. “Our approach to the situation in Washington is business as usual,” Masswohl told Canadian Meat Business Magazine. “I’ve been around all this for more than 15 years and I can say, there has not been a day when something doesn’t come up that’s crucial and sometimes controversial in terms of international trade. However, I can also say that we’ve never been in as 10

good a position on trade as we are right now. “I look at it this way. Despite what President Trump says from day to day, we’re not in any trouble, at least not yet. Our relationship with the beef and cattle organizations in the United States has never been better, more co-operative and more understanding of each other’s needs than it is right now.” That belief is held almost right across the board in the U.S., at almost every single level of farming and ranching in the country -- not just in the meat industry, but in all other forms of farming in the United States. For example, Gordon Stoner, president of the National Association of Wheat Growers, said in late October that “growers have already been hurt by the uncertainty caused by the Trump administration’s NAFTA rhetoric and posture to date.” “Trump was treating other countries as if they were the other side of a real estate deal, to be discarded after the transaction, rather than long-standing partners,” Stoner said. “The administration’s behavior on NAFTA would make it harder to get other countries to agree to the bilateral agreements Trump has said he prefers. “As a negotiator, part of what you have to do is understand the person on the other side of the table. I can only think people on the other side of the table are looking at the U.S. right now and saying, ‘Why bother? They’re going to tear it up in five years. They’re going to say it’s a terrible deal. They’re going to walk away from it. Why even invest in the negotiation?” Jim Monroe of the National Pork Producers Council in the United States told Farmscape Online that NAFTA must be maintained and strengthened. “It is important to move through the negotiation quickly and to maintain the benefits that have been realized through NAFTA,” he said. “We have very aggressively advocated our position on NAFTA to the administration, including the U.S. Trade representative, to the U.S. Department of Agriculture and to Congress. I think right now there is a certain level of uncertainty around trade in North America, between the U.S., Canada and Mexico and I think the sooner we can eliminate that uncertainty the better. “Uncertainty around trade agreements like this make businesses more reluctant to invest in growth opportunities both at home and abroad so I think the sooner we can remove the cloud of uncertainty around us right now, the better.” Even the U.S. Chamber of Commerce has come out in support of NAFTA. More than 300 Chambers and various business groups signed a letter to Trump asking

that NAFTA be modernized, but retained.

said. “I believe when it comes to our relationship with

“There are so many things that animals do that we don’t thebyUnited humans over the half-century. 2050, estimates States, we past just have to take By everybody aside “NAFTA created jobs,toboosted needhas them to do inAmerican order for them be food economic for us,” Selden and suggest meat production will have to increase to 455 assure them that Canada-US trade is beneficialmillion growth, strengthened local economies,” told and Forbes Magazine. “Eyeballs: What are the theyletter good for? to tons each year, up from 259 tons encountered, today, in order our to satisfy everyone and from what we’ve said,Fish “butguts: we potentially know we can even more to seize the feed American toxic.do The energy required to grow the additional demand generated by population and income counterparts share our view. We just have to benefits of trade North Americanhas neighbors.” for cattle and with raise our them until slaughter been estimated continue growth, to according a 2012 by the Unitedinterests Nations.” remind to them thatreport we have mutual at 25 calories expended per one calorie of energy contained that are made stronger by our solid, positive, long-term With that in mind, Lee doesn’t fear cultured meat as much as The letter notes that U.S. agricultural exports to Canada in beef.” relationships.” he sees it as a supplement to “real beef.” and Mexico have quadrupled since the agreement, Meanwhile, back at Maastricht, Post claims he has the price growing from $8.9 billion in 1993 to $38 billion in 2016. “Much of whatofI talks read will andbe hear about lab-grown The fifth round held fromthis Nov. 17-21 beef of the burger down to $11 US and the cost of his cultured is that it will be quite some time before it gets to market,” in Mexico City followed by the sixth round in Canada Neither nora pound. Mexico wants NAFTA revoked. beefCanada to $30 US he said. “When it does, I wonder if, instead of being a in December (TBA). Obviously, NAFTA – a 23-yearAlmost every United States agricultural organization Perhaps the best-known and seemingly most advanced oldsubstitute for our beautifully grown Canadian beef, being it will be a model agreement -- is now a long way from wants NAFTA maintained (we couldn’t find a single one company in the field is Valeti’s Memphis Meats. With much settled. Continued on page 10 that wants to completely dispose of the agreement, fanfare, it debuted a cultured beef although some Wisconsin Dairy meatball in 2016 and in March of this Farmers don’t like it). year, it held a taste testing in San Francisco forTrump cultured duck a l’orange However, if the Administration and cultured fried chicken. decides that it will tear up the

agreement, Canada are certainly “The challenges findinghas the cells options. that are the highest quality in terms of nutrition, protein content, fat content,

TWO IN ONE. SECOND TO NONE.

Our taste country the largest export andistexture,” Valeti told the San market for U.S.-made goods and Francisco Chronicle. Canada could hit the United States the cells grow with“The tariffsway on imports. We haveand longthe way we cultivate and harvest been eyeing closer ties with China,them is different each species. major to say nothing for of European and ALatin breakthrough in texture for us was American markets.

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us The to harvest bulkier And allows recently Telegraph andstrips of chicken and duck. This opensthat up Foreign Policy Magazine reported opportunities to developa thicker Britain is now considering NAFTA-cuts meat like steaks.” typeofagreement with Canada and Mexico (if the U.S. indeed pulls out) According to Valeti, Memphis Meats’ as it goal desperately to counter is “to belooks on the market inthe five tradeyears,” loss that already taken although it has will still beplace quite due expensive. to the slow-moving Brexit Right now, onetalks. pound And,ofofbeef course, if the U.S. remains in from Memphis Meats costs the agreement, the deal would be even $18,000 US to grow. more appealing to Britain because with “In the next 10 to States, 20 yearsMexico we wantand to Canada, the United have Memphis Meats be accessible Great Britain together, NAFTA would to seven billion people across the world,” account for more than 30 per cent of Valeti told the Chronicle. “That way the World’s economy.

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they can still have the delicious meat

that their cultures support, but eat Meanwhile, Canada has close friends meat with their eyespork wideand open, not in the American cattle, poultry worrying about it came from.” industries and evenwhere the tech industry, a group that has lobbied to And that’s an issue that tirelessly interests Ryder protect Lee NAFTA. at the Saskatchewan Cattlemen’s Association. The projections on According to Masswohl, the future of world protein growth coming from NAFTA is worrisome, but it’s not time to the UN are based almost entirely panic. Although, it is time for concern. on population growth. According to the is FAO, “Population growth and “NAFTA the model of what we think changing trends in diet have led a free trade agreement should be,” heto a doubling of meat consumption

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meatbusiness.ca

September/October 2017 CANADIAN MEAT BUSINESS 9

THE U.S. IS OUT, BUT 11 OTHER COUNTRIES SIGN TPP By Scott Taylor

Donald Trump has been out since January, but Canada is now officially in. And the news will please the Canadian Cattlemen’s Association. The 11 member countries of the Trans Pacific Partnership (TPP) recently reached an agreement to move ahead without the United States. The deal had been in some doubt after U.S. President Donald Trump abandoned it in January and it almost died this weekend as Canada fought hard for more climate and labor rules, but the other 10 countries agreed with Canada’s demands and the agreement was signed in the wee hours of Saturday morning. The news will please the Canadian Cattlemen’s Association. “We need a TPP11 agreement to ensure Canadian beef producers can improve access to Japan and other growing markets in Asia,” said CCA President Dan Darling, a beef farmer from Castleton, Ontario, in a written statement on Friday. “With an agreement, I can envision that we can double or triple our annual beef exports to Japan to over $300 million. “The TPP11 is an opportunity to exempt Canadian beef from tariffs in Japan of 38.5 per cent, which can snapback to 50 per cent when beef imports reach a certain trigger level, and restore Canada’s competitive position with Australian beef. Australia implemented a FTA with Japan in 2015 and enjoys a growing tariff advantage that is already making it difficult for Canadian beef to remain competitive in Japan. “(The TPP) is a major priority for Canadian beef producers to achieve a level playing field for all beef competitors in the TPP11 region,” Darling continued. “I am concerned about the long-term prospects of the Canadian beef industry if we do not address the tariff situation.” According to CCA Communications Manager Gina Teel: “Other potential wins for Canadian beef producers in the TPP11 include achieving elimination of beef tariffs in Vietnam and Malaysia, two countries that have not traditionally been significant beef consumers, but have been identified as potentially important markets in the future as their level of economic development increases. “Since the withdrawal of the United States from the original TPP12 agreement, Canadian beef exporters also see the opportunity for competitive advantage over U.S. beef,” continued Teel. “The CCA thanks 12

International Trade Minister François-Philippe Champagne for his strong efforts on behalf of Canadian beef producers at the TPP11 negotiating table to ensure the market access provisions of the original TPP agreement remain intact.” The agreement news release stated: “The Ministers maintained the high standards, overall balance and integrity of the TPP while ensuring the commercial and other interests of all participants and preserving our inherent right to regulate, including the flexibility of the parties to set legislative and regulatory priorities.” The agreement came just hours after Canadian Prime Minister Justin Trudeau was accused of blocking the agreement on Friday. However, Trudeau said that he had faith in the member countries to understand Canada’s position. “This is Canada. We won’t settle for just any deal,” Trade Minister Champagne told reporters in DaNang, Vietnam on Friday. “This is about making sure that Canada as a Pacific nation would have access to the markets in the Pacific region. This is also about setting the terms of trade in the region in regards to climate and workers’ rights. This was about labour issues and access and we fought for the best deal for Canada.” While Trump was giving a fiery speech in DaNang, Champagne and Trudeau were negotiating on behalf of Canada. While Trump yelled at people, saying the United States would not be “taken advantage of anymore,” Trudeau and the Canadian contingent were cutting a deal that will increase Canada agriculture profits by at least a billion dollars a year over the next five years. Trump said he would be happy to enter into bi-lateral agreements with the 11 individual members of the TPP, but that will be a much longer process. Trump also said he will only enter into agreements that clearly benefit the United States and that might be very difficult to arrange now that the core issues of the TPP have been ratified. In the short term, this TPP agreement, without the United States, could make the sale of U.S. agricultural products to Asia -- especially beef, pork and poultry products – much more difficult and complicated that it is currently.

MEAT AND POULTRY PROVE THEIR WORTH AS VERSATILE PROTEINS By Sean Moon, Managing Editor, Canadian Restaurant & Foodservice News

As centre-of-the-plate mainstays, meat and poultry have long held a prominent place on Canadian restaurant menus. But with chefs always trying to raise the creative bar and impress diners, many are reaching beyond international borders to develop inspired and innovative protein dishes, all while giving tradition its due respect. With the days growing longer and the scent of grilled beef, pork, lamb and chicken wafting throughout neighbourhoods across Canada, it appears that our love affair with meat and poultry shows no signs of abating. Perhaps more popular than ever thanks to an infusion of ethnic inspiration, meat is also continuing to address consumers’ desires for locally sourced, better-for-you protein options while providing them with the gustatory “wow” factor they have come to expect at their favourite restaurants. Tradition meets innovation In addition to diving into multi-cultural flavours, old-school cooking methods and family-style presentation, chefs are also giving a nod to tradition with a return to using all parts of the animal, increasingly sourced from local farms and producers. It is this unique combination of old-meets-new that keeps meat riding such a wave of popularity on foodservice menus.

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“One is hopeful that a trend towards respect for ingredients will continue to be one of the strongest movements in the years to come,” says Daniel Orovec, executive chef at Atlantica Hotel in Halifax. “Not only looking at the whole animal and utilizing as many cuts and options for both meat and poultry, but also deriving from this laudable plan an understanding that sometimes a simple respect for a high-quality piece of protein may very well be the best way to be both profitable and on point. To put it in other words, stop messing around with my food.”

dining – using the entire animal and reducing waste. “We are seeing a resurgence in nose-to-tail dining,” says Thompson. “Today, consumers’ minds and palates are more open to trying lesser known cuts of beef. Also supporting this trend is the access chefs have to more ingredients than ever, allowing for the fusing of cultures, using cuts from the entire animal. This trend offers chefs a platform for innovation and operators a way to enhance profits.”

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As a beef cattle producer in Tweed, Ontario, Kara Enright, co-owner of Enright Cattle Company, agrees that Orovec says there is an abundance of artisan butchers most exciting trend in meat dishes at restaurants in and farmers markets that offer cuts, US andtheCanadian Tom, Kittle, president of nose-to-tail the Handtmann represent Canada is the operations use of locally that sourced products.INOTEC, a development that harkens back to times when has announced the new generation INOTEC WT99-iT Link Cutter was recently honoured with customers knew theirthat butcher and he or she knew the “Whether you independent are on the East design Coast or institution, in the heart ofthe the highest equipment design award by Germany’s oldest customers. These tiny enclaves of meat heaven, says Ontario, locally sourced proteins are really starting to gain Orovec, can be a Forum potent breeding ground for innovative, International Design GmbH, located in Hannover. momentum. Farm names identifying the source of the ingredient-driven chefs’ creations. meat are being added menus. Chefs dealing Selected from more than 5,000 applicants from 59 processors. In fact, theto iT the series is a model forare modern directly with the farmers, exploring new cuts and learning countries, the INOTEC WT99-iT link cutter was noted for food processing equipment design with simple controls, “When the use of these other cuts are combined with about how their food is produced. The restaurants and its outstanding hygienic design and dynamic precision rounded edges, many ergonomic features, free access to all a flair for adventure, utilizing not only different cooking chefs are benefiting from the quality of product that they performance with proven technology that has been elements for maintenance and cleaning, and faster speeds methods but interesting and unique flavor profiles, a are receiving and being recognized and preferred by the upgraded previous generations in every critical area made possible by even more precise cutting. door can befrom opened to not only being ahead of the consumers as a source for local food.” affecting sanitation, performance, reliability curve but also more profitable. After all, letand us simplicity not forget INOTEC iT series link cutters work with all sausage types that of the use.food business is a business.” with extremely high precision at speeds up to 1800 cuts Family-friendly service The new iT generation link cutters are complying with all per minute for very efficient pairing hightrend performance But local sourcing is not the onlywith major in meat Reducing food waste of the hygiene, sanitation and ergonomics requirements packaging machines. and poultry. Mathieu Paré, executive director of the Tanya Thompson, national account manager at Cargill Canadian Beef Centre of Excellence, says with chefs and are meeting all of the demands for efficiency and For more information, visit http://www.Handtmann.us/Inotec or Foodservice, believes that sustainability is top of mind http://www.Handtmann.ca/inotec restaurateurs engaging guests in new and creative reliability in the heavy of modern and with consumers today,duty andworking is a keyenvironments part of nose-to-tail

meatbusiness.ca

September/October 2017 CANADIAN MEAT BUSINESS 25

ways, shared plates and family-style dining can open the door to dramatic presentations featuring larger cuts — for example, whole bone-in beef shank or pig’s head. “These are wow factor items that the can be shared,” says Paré. “This not only creates opportunities for economical and under-utilized cuts, it can highlight skill and technique and creates a very interactive experience for diners.” With the increasing popularity of family-style dining, larger cuts are being prepared in-restaurant and premium steaks such as porterhouse, rib eye and New York are being served carved for sharing at the table. “The sharing option makes meat dishes more approachable and enjoyable for a romantic table of two or groups alike,” says Paré. “Economical cuts used in slow-cooking techniques are also popular and make for great sharing options. Trimmed product can be reworked into charcuterie preparations such as sausage or rilletes. These value-added menu items can be a great profit centre for restaurateurs.” Economical fare Not only are so-called offcuts often more economical, they are also sparking interest from chefs who, like Paré, see novel uses for many such ingredients. Connie DeSousa, chef and co-owner of Charcut in Calgary, says that as a restaurateur and business owner, she is always looking for the best deals and offcuts are still the best deals around. “One of my favourite cuts is the heart,” says DeSousa. “While it is an organ meat, it lends itself really well to steaks because the muscle fibre in the heart is quite similar to something like a New York steak. So, I’m always recommending offcuts for our guests to try. We butcher everything in-house so it makes it easier to

serve items like that. It is also important to make these cuts as familiar as possible to the guests, such as our beef heart kielbasa which is a really popular item on our menu.” Cattle farmer Kara Enright also believes that consumers are becoming more aware of less-common beef cuts and are willing to try them. “These cuts are typically economically priced but when prepared and plated they can compete on all levels with the prime cuts,” says Enright. “These cuts can give the consumer an excellent eating experience and are an affordable beef option. They also provide the restaurant with an affordable source of local quality beef.” Unique protein option Mark Hills, president of Hills Food Ltd., believes that with consumers becoming more interested in sustainable, wholesome ingredients, they also want proteins that are delicious and nutritious. That’s where some of his company’s less-traditional meats and proteins such as kangaroo come into play. “Conventional livestock production is challenged by the sustainable/eco-friendly aspect — methane production being the most significant byproduct of their activities,” says Hills. “Global warming is here. Kangaroo does not create methane. No trees need cutting. No watering needs. No fences built. It really is a no brainer.” Plus, says Hills, with wholesale venison loins costing as much as $50 a kilogram compared with kangaroo loins at $18/kg, the math also makes good sense. “Kangaroo meat colour, texture and flavour are so close to venison, yet the pricing makes it a very, very food-cost friendly protein. Perceived value of the product by the consumer is strong so the return to the restaurateur is significant.”

continued on page 16

Returning to roots While more chefs are discovering the value and variety of offcuts and less-popular meat proteins, a growing number are also returning to more traditional cooking and preparation methods. DeSousa, for example, says a lot of chefs are turning away from gas cooking and are looking back to the past with wood-fired grills and other solid fuels.

cattle are raised on farms in Canada! So just adding that “farm-raised” adjective can add value to a menu.”

“A lot of chefs are craving that kind of natural smoke and char that you would get off the solid-fuel equipment,” says DeSousa. “While it is quite expensive to install with the complications of the required ventilation, I think this kind of equipment makes a huge difference on the outcome of the dish.”

“Our chefs here at Cargill are really liking some of the Middle Eastern seasonings such as dukkah (toasted and ground nuts with coriander and cumin) and za’atar, (fresh thyme, sesame seeds, sumac). A couple of other new sauces they have been experimenting with are chermoula and zhoug — which is kind of like green chili pesto,” says Thompson.

Atlantica’s Orovec agrees that when it comes to preparation methods, everything old really does seem to be new again. “The return of more traditional cooking methods is opening the kitchen to more useful and beneficial applications. Braising would be the most obvious of these cooking methods,” explains Orovec. “The art and chemistry of flavour enhancers, time and temperature to change an inedible veal shank into Osso Bucco, as an example, has helped to transform menus across the country. The same can be said of a confit application to food items realizing a benefit to the bottom line as well as to the palate of our guests. Sous vide cooking gained traction in the 1970’s at the Restaurant Troisgras and has grown in recent years to be an ‘innovative’ way of approaching not only protein preparation but all manner of applications — think sous vide curried cauliflower.” Inspires creativity Although under-utilized cuts have their place and are inspiring some creativity, innovation in meat and poultry recipes is also being driven by a number of factors, including the consumer’s desire for healthy, locally sourced food along with the ethnically influenced use of spices and seasonings. “Continued focus on local, clean Canadian food is influencing recipe development and more products are being developed and produced in-house,” says Mathieu Paré. “From sausages to sourdough, chefs are taking on the challenge to create recipes rather than purchase convenience product.” Cargill’s Thompson says a major factor in the desire for more transparency about the food they consume is the Millennial generation, which represents a growing force in the restaurant-going demographic. “Millennials want to know the story behind the food they are eating and look for stories that make them feel good about what they are eating,” says Thompson. “Over one-third of Millennials are willing to pay more for farmraised beef. The interesting part of this is that all beef 16

Spicing things up Of course, even the highest-quality meat or poultry can sometimes use a helping hand when it comes to creating variety and flavour. Ethnic spices, herbs and sauces are proving their value with chefs time and again.

Charcut’s DeSousa and others are looking further afield as well, turning to Italy, Asia and beyond for new flavours to enhance their already stellar protein dishes. “One of my favourite seasonings to use, especially when making gravies, and which is probably a little untraditional, is adding a dash of soy to the gravy,” says Charcut’s DeSousa. “It really kicks up the umami and adds really great colour as well.” Boosts flavour Mike McKenzie, owner of Seed to Sausage Corporation, recommends one of the “hottest” protein enhancers on the market today — nduja. “Pick up some good nduja if you want to add a spicy umami bomb to any dish, not just pasta,” says McKenzie. “Ramen, eggs, tacos, octopus — anything you want to add heat to. It’s a must try. Just sauté some onions and garlic with a bunch of oil and then melt a big chunk of nduja into it. I promise it will blow you away.” With worldly influences becoming more prevalent from fine dining to neighbourhood pubs, it’s no surprise that chefs like Orovec see a constant shifting of flavours on menus, especially when it comes to meat. “Whether it’s chimichurri sauce for your grilled flank steak or kimchi-braised chicken, it’s getting easier and easier to find interesting flavours tied to ethnic cuisine. Call them “artisan” if you will but I get most excited with the spice market and what can be done with these offerings. I think of smoked sea salt, Himalayan pink salt, granulated paprika, different rubs that can be created with high-quality spices and the plethora of different peppers out there. Options is the key word here; the rest is left to the imagination and skill of the chef.” “Article reprinted with permission of Canadian Restaurant & Foodservice News, (Vol. 8, No. 2, Summer 2017), published by Mediaedge Communications. Copyright 2017, Mediaedge Communications. All Rights Reserved.”

DF: I JOLLEY don’t think being on the island CHUCK Q&A:

has really impacted us negatively one way or the other. We’ve traveled a lot, met a lot of other farmers and livestock producers in other parts of Canada, and we all seem to have the same issues and same concerns.

FIVE MINUTES WITH CANADIAN MEAT COUNCIL’S RON DAVIDSON AND THE NEW TPP CMB: I understand that your farm was the first in Atlantic Canada to be involved in the TESA program.

DF: Yes, I think we were the first farm east of Ontario as far as I understand. I’m not sure why the eastern associations wouldn’t have previously nominated anybody because there are many farms here on PEI doing every bit as much as we are as to attain a high level of sustainability. Anyway, we were very surprised when the PEI Cattleman’s Association nominated our farm. Davidson has a special vantage

Ron point ofCMB: the new Trans And then you Pacific were attending the Partnership (TPP). the senior viceCanadian BeefAs conference in Calgary andof you won. president international trade and public affairs forThat thewas Canadian DF: Yeah! a very niceMeat moment Council,forhe’s witnessed us. But I don’t likefirsthand to use the the insanely complicated process word win actually. However, being of negotiating trade agreements recognized for our commitment was between multiple a real honour.countries. If you want to know truth, it was a pretty Originallythe designed to create thehumbling world’s experience. As I said to CBC when they largest trading bloc, the TPP brought a dozen phoned me after the conference, I was nations together to hammer out an agreement floored, really couldn’t believe it. that was just championed by the Obama administration. CMB: So now that you have been recognized, do you of think that will The economic advantages TPP were draw more attention and garner more significant, as were its unspoken political nominations out of Atlantic Canada advantages. Erecting a trade barrier against going forward? an expansionist and increasingly militaristic China, even if it might have been done as DF: Absolutely. We’ve gotten a lot diplomatic sleight-of-hand, was always part of good press highlighting the island of the American agenda. cattle industry. I’m positive you’ll see

But the best-built apple more farms in ourcarts neckoccasionally of the woods get upset.nominated One of incoming next year.President And I haveDonald to give Trump’s first acts wasCattleman’s to yank theAssociation U.S. from the Canadian the TPP, an agreement he described recognition for choosing a farmduring from his presidential campaign as “another disaster Prince Edward Island. We are small done andplayers pushed by special interests who in the national beef industry want to rape our country, just a continuing and I think it was a real credit to their rape of our country.” organization to recognize us. They

But thosetreated dozenallTPP controlled the nations nominees royally and it a huge percentage of world trade was a real class act. It was and a wonderful the agreement gave an important edge experience. to U.S. agriculture. The American pull-out potentially handed much of that advantage to its Canadian brothers. Although U.S. ag’s economic might was at the heart of the continued on page 18 meatbusiness.ca

17 17 September/October 2017 CANADIAN MEAT BUSINESS

TPP, the sizable market opportunity represented by the remaining countries offered very broad financial benefits that Ottawa readily understood. But what does it really mean in dollars and cents for Canadian agricultural? Speaking for the Canadian Meat Council, Davidson said they wanted to move forward quickly to take advantage of a potentially much more important opportunity. Q. Ron, you said “We are hopeful that perhaps in November, during the next meeting of the Asia Pacific Economic Cooperation Group, that there will be a decision by the Trans-Pacific Partnership (TPP-11) ministers to move forward.” Knowing the recalcitrance of U.S. President Trump on the TPP, it’s a safe bet that the 11 will go it alone. It would mean a lot of new opportunities for you. Would you talk about them? A. In 2016, Canadian meat exports to the other ten remaining countries of the TPP totaled $ 1.7 billion (Canadian $) or 28% of Canada’s total meat exports. It is estimated that implementation of the current provisions could result in a $500 million increase in trade. Q. There are some carefully negotiated TPP clauses that were said to be “of particular interest to the US” that will be reviewed and possibly deleted so the remaining 11 participating countries could move forward. You’ve asked your government to move quickly on this. Why? A. Japan has implemented a free trade agreement with Australia. Canadian meat exports to Japan are being impacted negatively by lower Japanese import tariffs enjoyed by Australian exporters and by Australia’s exclusion from the even higher import tariffs applicable under Japan’s meat import safeguard measures. Japan and the European Union have announced they are nearing the conclusion of free trade negotiations. Each year that passes further increases the disadvantage in terms of market access between countries that have a free trade agreement with Japan and those, including Canada, that have not negotiated and implemented a free agreement. Q. “Quickly” is a nebulous term. Would you define it according to your wishes? And are those wishes realistic when you consider the other 10 nations? A. The terms of the TPP market access provisions have already been negotiated. Some TPP countries, including Japan, have obtained legislative approval of the TPP text. The agreement could be implemented as soon as all member countries complete their respective legislative approval processes and an entry into force date has been determined. Q. With the enormous American agricultural output off the table, Canada could realize some significant growth in Asian markets. Where do you see the greatest opportunities? A. The Trans-Pacific Partnership includes significant trade liberalizing provisions for the meat sector. The provisional terms of market access for meat entering 18

Japan are particularly noteworthy, of interest also to the Canadian meat sector is participation in the agreement by Malaysia, Singapore and Vietnam. It’s anticipated that additional countries which are important to Canadian meat exporters may adhere to the agreement in the future. Q. Talk to me about the shape of the new TPP. How big will it be? What will be its effect on Canadian agriculture? A. The remaining TPP member countries are commercially significant for Canadian exporters and investors. Total merchandise trade among these countries reached $404 billion (U.S. $) in 2015. Together, the 11 countries, including Canada, represent 494 million people, with a combined Gross Domestic Product of $10.2 trillion (U.S. $), or 13.6% of global GDP. As Asia’s rapid growth transforms the global economy, it is essential to solidify commercial engagement in the region if Canada is to remain globally competitive. Participation in the TPP-11 is strongly supported by all members of the Canadian Agri-Food Trade Alliance (CAFTA), a coalition of national and regional organizations that represent farmers, producers, processors and exporters. Collectively, the CAFTA member organizations account for 90% of Canada’s agriculture and agri-food exports. The TPP is envisioned by CAFTA as a comprehensive and high-standard free trade agreement which addresses existing and emerging trade issues in ways that meet 21st-century objectives. Participation will increase Canada’s foothold in Asia, a region that is expected to contain two-thirds of the world’s middle class by 2030. Q. One of the unspoken aims of the TPP, especially from the American point-of-view, was to hinder growing Chinese influence over nations in the Pacific basin. China is a huge marketplace for agricultural products, though. With the new TPP going forward without U.S. participation, do you see that country becoming a welcomed ‘partner,’ either officially or unofficially? A. China is a lead participant in the negotiation of the Regional Comprehensive Economic Partnership (RCEP), a free trade agreement between the ten member states of the Association of Southeast Asian Nations (ASEAN) (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, Vietnam) and the six states with which ASEAN has existing free trade agreements (Australia, China, India, Japan, South Korea and New Zealand). Several countries (Malaysia, Singapore, Vietnam) are participants in both the TPP and the RCEP. As the TPP is broader in scope than the RCEP, it is possible that the two multi-country agreements will coexist and, collectively, determine the future framework of trade and investment rules and flows in the Pacific Region. Reprinted with permission from Drovers - https://www.drovers.com/ article/jolley-five-minutes-canadian-meat-councils-ron-davidson-andnew-tpp

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THE BEST DEFENSE IS A STRONG OFFENSE PROMOTING THE HEALTH BENEFITS OF MEAT AND POULTRY By Ronnie P. Cons

Red meat is often wrongly portrayed as being unhealthy. Even chicken has been getting attacked by some in the media as unhealthy or not environmentally friendly. Vegan, fish and other non-meat diets have been proposed as healthier alternatives. The result of this onslaught of negative meat messages has influenced many families to cut back on their meat and poultry purchases. Perceptions may reality but truth trumps misinformation. Parents and other consumers want what is best for their health and that of their families. They are also aware that a lot of false information is out there and as such, are open to scientific facts that can correct their misconceptions.

liver, 625 grams of cooked beef or an astounding 2.4 kg of spinach. Iron found in vegetables is harder to absorb than the iron found in meat as it is attached to fibre which inhibits its absorption.

AGRICULTURE CONTRIBUTED $111 BILLION TO CANADA’S GDP IN 2016 This provides an opportunity for retail meat departments to implement an instore ‘Healthy Meat Facts’ nutritional campaign to set the record straight and convince their customers that meat and poultry are actually good for one’s health and that they should increase rather than decrease purchasesreleased of it. The campaign can have Atheir recently reportoutlined frombelow Agriculture a direct impact on sales:

2. Eat Meat for a Healthier Brain! Being deficient in the micronutrients found in meat have been linked with low IQ, autism, depression and dementia says Dr. Charlotte Neumann, a paediatrician at the University of California, as quoted in the article ‘Brain food- clever eating’. Zinc is crucial for learning and memory. Vitamin B12 preserves the sheaths that protect nerves. 3. Boost Your Immunity with Meat!

DueAgri-Food to its antioxidant powers, zinc in creating and Canada hasis involved pegged agriculture antibodies to fight free radicals that increase our risk for as contributing $111.9 billion to Canada’s GDP in 2016, which accounted 6.7 per cent of chronic diseases. Start by displaying instore posters promoting the nutritional the country’s total GDP. value of meat. They should be innovative, eye catching and 4. Power Your Muscle Growth with Meat! be designed to specifically contradict any meat myths. The

The annualshould reportallentitled An of the Canadian comments be literatureOverview based quoting research Agriculture andforAgriFood provides a summary papers or MDs maximumSystem, effect. Various posters should bethe made - each with a brief but powerful message covering of economic performance of the agriculture sector.

The protein in meat helps build and repair body tissues.

production in Canada was exported either directly or

Muscles are through made of protein. That is why athletes indirectly the manufacturing sector.who are building muscle strength increase their meat consumption. The protein found inprocessing meat are important forismuscle The food and andzinc beverage industry the one theme. and repair. largest manufacturing industry in Canada, accounting Over the last five years GDP in agriculture and agri-food growth Posters can convey the following healthy meat fact 16.4 per Complete cent of the total manufacturing sector’s systems has grown by 11 per cent, compared to the 5.for Meat is the Protein! messages: Meat all As of the nine essential amino acids that your Canadian economy which increased by 7.8 per cent. GDPcontains in 2016. well it accounted for the largest share 1. Let’s IRON out the Truth on Meat! body cannot make by itself. Say ‘hello’ to at histidine, leucine, of jobs in the manufacturing sector 17.3 per cent. would need to 2.3 eat amillion massive amount of spinachintothe In“You 2016 there was people employed isoleucine, lycine, methionine, phenylalanine, tryptophan, equal (the iron content) in a steak,” says Christopher threonine, and valine. Thatremained is why meat a complete Farm market receipts atisacalled record high of agriculture sector, representing 12.5 per cent ofGolden, total an ecologist and epidemiologist at Harvard University in protein. $57.6 billion in 2016. Between 1971 and 2016 farm Canadian employment. Cambridge, Massachusetts. (As quoted by nature.com in the receipts have grown 6.market Eat Meat for a Healthy Heart! on average by 5.8 per cent. article ‘Brain clever eating’.) Exports fromfoodthe agriculture sector rose to $56 billion Thiscontains has been byvitamins grain and oilseed receipts, Meat lotsdriven of the B needed for the inFor 2016. On atovalue basis, it is estimated that last of year a woman receive her recommended daily intake 18 production of hormones, cells and annually for the proper which have increasedred byblood 6.5 per cent over the mg of iron, she would just 300 of agricultural cooked bovine just over one-half of need the value of grams primary functioning of your nervous system. same period. Say ‘hello’ to niacin, folic acid, thiamine, biotin, panthothenic Netvitamin farm operating expenses dropped $44.2 billion acid, B12 and vitamin B6. They are allto found in meat.

in 2016, which was a 0.9 per cent decrease from the

The line thatyear. ‘the best is first a good offense’ not and previous Thisdefense was the decline in does six years only apply to sports. It also applies to countering negative was due to lower fertilizer, machinery fuel and cattle meat health myths. Implementing an instore ‘Healthy Meat prices. Facts’ nutritional campaign to set the record straight on meat and poultry. It is a good way to go on the offensive by using The federal government spent an estimated $5.4 billion education your customers and increasing your sales..

in support of the agriculture and agri-food sector for

Ronnie P. Cons is CEO of C&C Packing Inc., a leading Canadian distributor of the fiscal year of 2016-17. This accounts for 24.2 per meat and poultry. He can be reached at RCons@CCpacking.com.

cent of agricultural GDP. Public funding of research for agriculture was estimated to be at $557 million for the fiscal year of 2016-17.

22 CANADIAN MEAT BUSINESS September/October 2017 20

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FAWN FAO JACKSON AFFIRMSQ&A: SUSTAINABILITY IS CATTLE’S REALLY COMING NOW

CRITICAL ROLE AS UPCYCLER

By Cam Patterson

With the concept of sustainability ringing in the ears of food industry pundits over the years, along came the juggernaut that would be the Global Roundtable for Sustainable Beef (GRSB). Willed into existence in 2012 byPlace, a consortium of industry like McDonald’s, Cargill By Sara Ph.D., National Cattlemen’splayers Beef Association and Elanco, the roundtable fostered a membership base spanning five In the livestock versus human food debate, we haven’t been constituency groupsfeed across the beef supply chain, including: producers andusing producer organizations; civil societies; retailers; processors; and the the right numbers. Rather than being a drain on global commerce sector. would be another two years the by fiveeating core lots resources and It competing with human foodbefore supplies principles natural resources, people and the community, animal of grain, livestock are often net contributors to the globalhealth protein and welfare, food, and efficiency and innovation – would be announced supply. That’s the conclusion of a new study from scientists at the at the inaugural conference in Sao Paulo, Brazil, defining the GRSB’s UnitedSince Nations and Agriculture mandate. thenFood the initiative faced theOrganization daunting task(FAO). of raising awareness and cultivating a loyal stakeholder base across the globe. The FAO researchers developed a global database of what livestock eat and found After five years of forums and metrics planning the Canadian Roundtable for 86 percent of the feed is human inedible. Mostly, livestock eat grasses grown on Sustainable Beef (CRSB) is going live this December and executive director, Fawn marginal lands and other forage crops, like alfalfa. Marginal lands are those that Jackson, couldn’t be more excited. are too rocky, steep and/or arid to support cultivated agriculture, such as fruit or In her role as the CanadianGlobally, Cattlemen’s Association’s Manager Environment vegetable production. livestock also eat(CCA) over 1.9 billion of metric tons of and leftovers Sustainability, she represents Canadian cattleproduction. producers, not only at the GRSB, from human food, fiber and biofuel but a host of environment committees. She has had a firsthand role in setting research For example, livestock eat the residues of grain harvest (the stalks and leaves and environment policy. Since 2014, she’s divided her time between her CCA role and in the fieldDirector after corn harvest), thatleft of Executive of the CRSB.the byproducts from milling grains for flour production (wheat midds), cottonseed that is a leftover of cotton production, and Canadian Meat to talk glycerol andBusiness distillers (CMB) grains had thatthe arechance byproducts ofsustainability soy biodieselwith andher. corn ethanol CMB: Can you explain the three pillars that shape the CRSB program? production, respectively. If livestock didn’t consume these plant-derived leftovers and byproducts, their disposalBenchmarking would likely result environmental burden. FJ: Certainly. First is Sustainability with in ouranNational Beef Accessibility By being a part of the global food system, livestock enhance the sustainability Assessment, which assesses how the industry is doing with respect to sustainability of other food industries. awareness withproduction a focus on and social, economic and environment areas. For us, this year has Considering really been about communicating those and identifying ways to achieve that most of what cattle eatresults, is not human edible, the FAO researchers those goals and strategies that are written into that document. found that 1 kg of protein in meat and milk only requires 0.6 kg of protein from humanwere food.working Additionally, the protein in meat and milk isBeef of higher nutritional Secondly, to develop the Certified Sustainable Framework, which quality compared to the in grain that eat. has really been our big applies to on-site tracking of protein beef operations. Thiscattle component focus forFAO 2017. The research represents global averages, but beef production in the U.S. Andcompetes thirdly is Project andwith Sustainability that works onasupporting conservation even less human edible food. In recent report published and by the habitat preservation for sustainable beef. National Academies of Sciences, Engineering and Medicine, it was estimated that on you average greater than 90 of percent of of what grain-finished beef cattle CMB: Can give me an example the kind project CRSB is involved witheat in their lifetime is human inedible forages and plant-derived leftovers. Less than 10 specifically for environment? percent of their lifetime feed consumption is grain that could potentially be eaten FJ: We have one project in Southern Alberta that focuses on collaborating with by people. ranchers to better maintain and enhance the wildlife habitat overlapping with their Further, a report published the Council Agricultural Science range lands.in We are working with abynumber of thefor CRSB members on this,and namely; the Technology, U.S. grain-finished beef systems were found to contribute 19apercent Alberta Beef Producers, Alberta Conservation Association, MultiSAR (which is habitat more human edible protein than they consumed. stewardship program that deals primarily with species at risk), the CCA, and Cows and FishSara (a management dedicated to riparian stewardship management). Place, Ph.D., is asociety Senior Director, Sustainable Beef Production Research, with the National Beef Association. The Cattlemen’s aim is to support producers in decision making or with projects on their operations View the FAO study at: http://www.sciencedirect.com/science/article/pii/ that support habitat conservation for high risk species, typically wild life, reptiles, S2211912416300013?via%3Dihub and so on. Essentially, biologists will go out to a beef operation that has voluntarily asked to participate in the project. They’ll do a range assessment, a riparian health

meatbusiness.ca

September/October 2017 CANADIAN MEAT BUSINESS 2721

assessment, and a species assessment, and then the team will analyze that information and determine if the producer has been doing well with respect to wildlife management. They may provide recommendations on how to improve problem areas and can also identify funding and/or alternative methods to implement proven conservation practices. It really is about collaboration between the producer, who typically know their range lands extremely well, and those experts who can come in with help to advance conservation preservation on their operations. CMB: What type of funding could producers seek to implement such recommendations? FJ: One example would be Climate and Environment Change Canada. They typically provide funding for such programs. CMB: It was big news when the five principles were announced in 2014. Now that the CRSB program is close to practical application, do those principles still anchor the benchmarks for the framework? FJ: Yes, having those five guiding principles of sustainable beef really does act as the guiding posts of everything we do within the CRSB. For example, having that broad definition of sustainability is extremely important in establishing consistency when we’re considering the work the Colombians are doing, or the Brazilians, Americans, Australians, or any participating country for that matter. I really do feel the GRSB has been very supportive in recognizing that one production practice doesn’t necessarily apply to every region around the globe. Right from the start they were keen to make sure that initiatives were outcome based, and appropriate for the regions in which they were developed. Allowing each of the regions this kind of flexibility to achieve the five principles is one of the primary reasons this global initiative has been so successfully received.

How would you define the value such forums contribute to framework development? FJ: Invaluable to be honest. Throughout the process of designing the certifiable beef framework, CRSB has had three committees that worked on development; Indicator, Verification, and the Communications and Marketing committee. Public consultations were an integral part of that process, and were so fundamental in establishing a nationally unified sustainability framework. We had excellent public engagement and the commentary definitely moved us forward. This last round we had some 250 comments that we took into consideration, determined the value of instituting those changes, and in some cases defended reasoning for why some indicators were listed as they were. But getting that input really contributed to us achieving a certifiable beef framework that is as close to perfect as I feel we can get. CMB: What are the components to the framework exactly? FJ: There are four main parts to the framework: The indicators of course - what would you measure during beef operations to verify sustainability. The assurance protocol - what does the certification process look like. Track back – how do you track that product through the supply chain. And the communication guide part as well. CMB: How would you describe CRSB’s role with respect to data management and tracking? FJ: CRSB is more the framework holder and then from there onus is on the supply chains to manage their tracking data. There are certification bodies that approve and track that information, but that is not under the proviso of the CRSB. We stipulate what information has to be tracked but how producers and processors choose to do that is up to them. CMB: Is participation voluntary?

For example, Columbia was just approved last year. Paraguay and Uruguay are doing some really fantastic work. They’re on a trajectory to have a sustainability initiative and maybe even an official roundtable. There are discussions now in China and Africa. It has been really amazing in how this initiative has grown globally. It brings so many different stakeholders together that it is really going to strengthen the global beef industry on a whole.

FJ: Yes, within Canada, participation is voluntary and purposeful. We understand the program will work for some producers and not for others. Yet we do have a variety of ways for producers and processors to engage in the program because it is important to us that we continue to drive forward our mission to achieving sustainable beef in Canada.

CMB: Have you had the opportunity to visit other participating countries to get a sense of how their managing the five principles?

FJ: We’re going to launch during our fall AGM in Edmonton this December. There will be a launch event on the 7th from 3:00 pm-7:00 pm.

FJ: Yes. I’ve been able to work with various regions and that has been so valuable to see how they approach the same goals. And as much as they may implore differing methods there are also many similarities, so you gain a lot of peripheral knowledge that directly adds to your own success.

CMB: Does it feel like a long time coming for you?

CMB: What has been done to expand public awareness? FJ: Social media, forums, conventions have all really helped because there are a lot of different sides to the sustainability conversation. That said, we are continually driving our initiatives forward while we strive to more effectively talk about how our industry is achieving the sustainability objectives. CMB: The last public consultation was this past summer. 22

CMB: When is the official launch and what is it going to entail?

FJ: In all actuality, given that we’ve developed a comprehensive program like this that is the first of its kind in the world, it was done relatively fast. I think this really exemplifies the dedication of the committees and also the broad membership, and is truly admirable for the CRSB to take leadership in this area. Everybody from producers to processors to retailers wants to have a more sustainable industry and recognize how to move that forward while establishing common ground that has led to a successful sustainability beef program. I’m very of the work we’ve done.

CANADIAN AGRICULTURAL PARTNERSHIP: government’s responsibility to be able to protect its

SETTING THE FOUNDATION FOR OUR FARMERS AND FOOD PROCESSORS

citizens, protect labour standards, protect the environment, while at the same time sharing and promoting the values that we share, Canada and Europe,” said the Canadian Prime Minister.

Canada’s hardworking farmers and food processors are the backbone of Canada’s economy, certainly am looking forward to seeing the impact particularly in rural communities, and ensure families“I across Canada, and around the world, have that CETA will have on future trade deals between other safe, high-quality food on their kitchen tables. Having identified agriculture and agri-food as a key countries our where they realize that we have raised the bar in growth sector, our Government is committed to supporting farmers and food processors with demonstrating that trade can and must work for everyone. strategic investments that expand growth and create well-paying middle class jobs. In July 2017, federal, provincial and territorial (FPT) ministers of agriculture came to an agreement on the key elements of the Canadian Agricultural Partnership, a five-year, $3 billion FPT investment for Canada’s agriculture and agri-food sector. This agreement will help the sector reach our Government’s ambitious goal to grow Canada’s agriculture and food exports to $75 billion by 2025. Minister of Agriculture and Agri-Food, Lawrence MacAulay has announced the initiatives and priorities of the $1 billion federal investment under the Canadian Agricultural Partnership, which is set to launch on April 1, 2018. “This is an exciting new chapter for agriculture in Canada”, stated Minister MacAulay. “The Canadian Agricultural Partnership’s federal initiatives show our Government’s strong agenda for growth in agriculture and agri-food – one that will help build an even stronger, more innovative and sustainable sector. It will ensure Canadian farmers and food processors are well positioned to meet the world’s growing demand for our high-quality products, while creating well-paying middle class jobs and delivering prosperity for communities across the country.”

And that is something very much reflected in the G20 adopt leading edge technologies and processes. communiqué.” AgriDiversity - Will strengthen the sector and build its capacity by JULY helping diverse groups to take a greater leadership role, 1 DEADLINES PASSED building the entrepreneurial capacity and business skills of The joint statement fromfacilitating the two leaders says the under-represented groups, the sharing of industry agreement “will enter definitively into force once the experience, best practices and knowledge, help underrepresented groups to manage transformation, and strengthen parliaments in all member states of the EU ratify the text the sector by incorporating the views of a more diverse set of according to their respective domestic constitutional industry players. requirements.” AgriAssurance - Will enable industry to make meaningful and verifiable claims about the health and safety of Canadian Four EU products. countries have held votes and to agricultural It will also ratification build industry capacity increase public confidence in the food system, respond approved CETA to date: Latvia, Denmark, Spain and to market Croatia.requirements and meet consumer demand. The program is for national industry associations and small and medium-sized enterprises. “This is a good outcome,” said Jason Langrish, the Theexecutive strategic director investments the Europe Canadian Agricultural of theunder Canada Roundtable for Partnership will set a solid foundation for the future of Business. “A firm timeline with path forward. CETA is Canada’s farmers and food processors, and continue to help them grow, innovate a survivor. It’s the and first prosper. of the next generation of trade

Under the Canadian Agricultural Partnership, the Government is committing to targeted investments with a focus on the following priorities: growing trade and expanding markets; innovative and sustainable growth of the sector; and, supporting diversity and a dynamic, evolving sector. Six federal programs will support these priorities and ensure the sector’s long-term prosperity:

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AgriMarketing - Aims to increase and diversify exports to international markets and seize domestic market opportunities through industry-led promotional activities that differentiate Canadian products and producers, and leverage Canada’s reputation for high quality and safe food. The program is for national industry associations and small and medium-sized enterprises.

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AgriCompetitiveness - Supports the markets and trade priority by assisting industry-led efforts to help the agriculture and agri-food sector leverage, coordinate and build on existing capacity, enhance safety, adapt to changing commercial and regulatory environments, share best practices, and provide mentorship opportunities.

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AgriScience - Designed to accelerate the pace of innovation by supporting pre-commercialization activities and investing in cutting-edge research to benefit the agricultural and agrifood sector. Within the Program there are two components: Clusters and Projects. Applications for the Clusters component are now being accepted. Industry groups interested in submitting an application are encouraged to call 613-759-1977 or email aip-pai@agr.gc.ca.

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AgriInnovate - Will accelerate the commercialization and/or adoption of innovative agri-based products, technologies, processes or services. The program will support agribusinesses to get their innovations into the market, or to 28 CANADIAN MEAT BUSINESS July/August 2017

SIX REASONS TO JOIN THE CANADIAN BEEF SUSTAINABILITY ACCELERATION PILOT Cargill leadership outlines why producers should consider participating There’s no doubt it has created interest. And depending on who you talk to, it could be the biggest opportunity the beef industry has had in years.

one year, it’s designed to build a dependable cattle supply, ready when a beef sustainability brand is launched.

Canada is taking the lead internationally for the building of a brand around beef sustainability. Beef producers will get a chance to get in on the program early by participating in the Canadian Beef Sustainability Acceleration Pilot.

Emily Murray oversees the McDonald’s beef portfolio for Cargill in Canada and the U.S. and has been a leader in the brand development work to date. She says there are at least six good reasons why it will make sense for Canadian beef producers to consider participating in the pilot.

Cargill has partnered with the VBP+ and the Beef InfoXchange System (BIXS) to launch the Acceleration Pilot. Starting in October 2017 and running for at least 24

1. The concept is proven. As a quick recap, the McDonald›s Canada sustainable beef pilot project from

2014 to 2016 proved that verifying general sustainability practices on-farm and tracing beef through a Canadian supply chain could be done in a way that was understandable to consumers, says Murray.

and if we do not reassure them then someone else will, she says. “We want sustainability to count for something as CRSB has defined it, before somebody else defines it in another way.”

NSF INTERNATIONAL FOCUSES ON 6. It’s easy to sign up. “We need producer help,” says Murray. “We are goingWITH to do our best NEW to get the word CANADIAN FOOD INDUSTRY out on the importance of participating in this pilot, but 2. We need volume to succeed. Strong interest in we can›t build scale alone. WEBSITE FOR SERVICES IN CANADA a concept does not always translate into scale in the The Canadian Roundtable on Sustainable Beef (CRSB) is building a brand standard on how to validate that an operation is sustainable and what the terms are for making that claim.

market, says Murray. «You can create a standard and Global public health launch a logo, but if you don›torganization have the cattleshowcases numbers food industry behind it to meet requirements then we are not going to get anywhere very fast. NSF International in Canada recently launched a new website - www.nsfcanada.ca - to give Canada’s growing “The new pilot is intended to build volume,” she and complex food and beverage industry easy access says. “We know the fundamentals of the CRSB brand to the global public health organization’s expertise and program will work so we don’t need to wait until they services in Canada. The website combines information are finished to get going on it. We need to get in front of on the depth, experience and capabilities of the NSF consumers sooner than later.” International Canadian office with access to NSF International’s global services dedicated to food safety 3. There are benefits to participating. Build the and quality.

industry, collect a reward. Those are two main reasons Evolving regulations acrossincountries and increasing for producers to participate the acceleration pilot. complexities associated with a globalized food supply

“If you are VBP+ Registered and you participate, that’s

services growing andinfast-changing great andfor we Canada’s thank you. But get others your chain to participate as well. The real value of this effort is in fully sustainable supply chains.” accredited International Association for Continuing

Education and Training (IACET) site. Topics include There is no cost to participate. Producers simply HACCP, get food safety and quality, GFSI benchmarked trained and audited by VBP+ to certify thatstandards, they are regulations (including FSMA), science, packaging, a sustainable operation. Theyfood register withfood BIXS and food microbiology ISO standards. Training modalities provide permission and for VBP+ and BIXS to include farm include eLearning, on-site, customized and enrolment. data in anonymous, aggregated reports toopen the project administration. And, of course, the necessary Additionally, the website includesprovide information about management system quarterly registrations for the food, automotive, information to collect credit payments. environmental, information security, medical devices, More information the Acceleration is available aerospace and on chemical industries,Pilot as well as for Ontario at http://CBSApilot.ca or from a VBP+ coordinator at www. drinking water programs. verifiedbeef.org.

There will bepresent economic benefits. VBP+ Registeredclients in network challenges for NSF International Visit the new Canadian website at www.nsfcanada.ca to review the food Canadawho and sign around world. producers upthe with BIXSThe fornew the Canadian pilot will website Thesafety article printed courtesy Meristem Land and Science services capabilities video,of find a list of Canadian food experts, learn www.meristem.com. about upcoming events and global news releases, a question offers expertise and services to help companies navigate receive a quarterly financial credit for every animal that YesGroup_CanadianMeatBusiness-Qtr-pg.pdf 1 submit 2014-05-16 1:20:17 PMor read an FAQ. these challenges, including certification andchannel. auditing, moves through an entire verified marketing consulting, technical services, training and education,

Producers arelabel alsocompliance, helping build a viableand industry longer food and packaging, product and termprocess by helping Canada be on the leading edge of this development. sustainability movement. NSF International’s Canadian website provides information on the following services:

4. There are solid partners in place and more to Certification & and auditing: food safety come. With VBP+ BIXS,Third-party both of which Cargillaudits has certifications, integral components solidand experience withwhich in thisare work to date, Murray of says supplier selection and regulatory the partners are in place to anchorcompliance. success. Accurate audits are the first step toward successful verification

of a company’s food safety providing improved McDonald’s and Swiss Chaletsystem, (Cara Foods) are also brand protection and customer confidence. Certifications on board, funding the credits for beef delivered to their and audits arefully available for animal and produce restaurants from sustainable supply chains.in the agriculture industry, GFSI certification and management

Other partners – like restaurants, retailers and groups system registration. or organizations that can help promote the effort - are Consulting: A full-service team approach providing welcome,” says Murray. technical resources, expertise and insight for a wide range of food safety and quality services. NSF International “If the consumer can see the brand in different places, provides finished product inspection testing for food, then it won’t be just industry talking to industry, it will be packaging and non-food testing for rapid analysis and a connection with consumers.” insight to protect the brand, technical support services from on-site temporary or permanent staffing 5. There is urgency. Consumers wanttechnical to eat beef, placements, and various types of consulting. but they want to know how that animal was raised

services: A one-stop solutionThey for food product and Technical how the environment was handled. want to formulation, to finished give compliance themselvesand permission to from enjoyconcept the product, says product, including food and label compliance, packaging, Murray. product and process development, and shelf-life and

“We product want toevaluation. give them that confidence.”

Training have and education: the global food Consumers access to Training a lot of for diverse viewpoints, and beverage industry across the supply chain as an meatbusiness.ca

25 September/October 2017 CANADIAN MEAT BUSINESS 23

FCC REPORTS SEE GROWTH FOR CANADA’S AGRICULTURE EXPORTS Canada is about to strengthen its position as one of the world’s top agriculture and agri-food trading nations, according to a pair of recent reports issued by Farm Credit Canada (FCC). “Our optimism comes from a unique set of circumstances where demand for both Canada’s agriculture commodities and manufactured food products continues to grow,” said J.P. Gervais, chief agricultural economist for FCC. “The stars are aligned for an industry that is already strong and has the potential to grow in a highly competitive world market.”

China and Brazil in world markets.

Canada was the world’s fifth largest exporter of agriculture and the 11th largest exporter of manufactured food products in 2016, according to the FCC’s trade ranking reports.

Canada exports several commodities that were both highly-valued global exports in 2016 and among the world’s fastest-growing exports between 2007 and 2016. These were pulses, soybeans, and fresh fish exports.

“Our reports confirm that agriculture is and will continue to be a major contributor to Canada’s growth and prosperity,” said Gervais, echoing of the findings the Advisory Council on Economic Growth’s report, Unleashing the Growth Potential of Key Sectors. The landmark report, released in February, notes that Canadian agriculture already employs 2.1 million workers and accounts for 6.7 per cent of the country’s gross national product (GDP). “I share FCC’s optimism in the future of Canadian agriculture and I am confident that our farmers and food processors are up to the challenge of reaching our target of $75 billion in agriculture and agri-food exports by 2025,” said Lawrence MacAulay, Minister of Agriculture and Agri-Food Canada. “We will continue to help farmers, producers and processors build their businesses globally with the help of FCC, a strong and stable partner to Canadian agriculture.” Agriculture commodity exports In 2016, Canada had the world’s fifth highest total export values, behind the United States, China, the Netherlands and Brazil. Canadian operations exported $24.6 billion worth of agricultural commodities, accounting for 6.3 per cent of the world’s total food exports, valued at $461.8 billion (all trade figures are reflected in U.S. dollars). The top three exporters (United States, China and the Netherlands) together accounted for 35.2 per cent of world agriculture commodity exports in 2016. Canada fell from third in 2012 due to the growing presence of 26

Canada ranked among the world’s top three leaders in no fewer than 11 agricultural export commodities: canola seed, wheat, rye, oats, buckwheat, flax, plants used for perfumery, crustaceans, pulses, fresh fish and bovine animals (includes cattle and bison).

Manufactured food exports Canadian businesses exported $19.1 billion worth of manufactured food products, accounting for 3.2 per cent of the world’s total food exports. Although Canada ranks 11th in total food export values, several of its food exports experienced some of the world’s fastest growth over the past decade. Total global exports of food products reached $602.5 billion in 2016. The Netherlands, the U.S. and Germany were the top exporters, a ranking they’ve maintained since 2010. The three countries together accounted for 24.9 per cent of world food exports in 2016. Several of Canada’s top-dollar food exports – beef, chocolate, bread, fruit and nuts, and pork – were also among the fastest-growing food exports in the world. Canada may be particularly well-poised to exploit opportunities to grow exports of canola oil, beef, pork, chocolate and bread. Aside from ranking Canadian agricultural commodity and manufactured food exports, the FCC trade reports examine Canada’s comparative advantage in agriculture and food exports. This reveals sectors for which Canada has an edge over other exporters. “When Canada’s reputation as a consistent producer of high-quality, safe agriculture commodities and food products is combined with growing world demand and our comparative advantage on so many key exports, the future looks pretty bright for Canadian agriculture,” Gervais said.

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CHINA’S PIG FARMERS GO NORTH, UPENDING WORLD’S TOP MEAT, GRAIN MARKET Reuters News Agency recently reported on China’s largest pig farming companies and how new entrants are racing to build vast, modern hog farms in the north-eastern cornbelt, expanding the world’s biggest pork market and upending traditional trade flows in meat and grain. At least eight listed companies have announced or confirmed plans to produce around 17 million pigs annually in the north-east in coming years. Many more companies, including the country’s biggest pig farmer, Guangdong Wen’s Foodstuff Group Co Ltd, are building farms in the area, suppliers and sources say, adding to China’s annual $1 trillion pork market.

Some researchers expect output in the northeast to hit nearly 120 million pigs a year, almost double the 69 million head produced in the area by Heilongjiang, Jilin, Liaoning and Inner Mongolia provinces last year. “In the next few years, almost 20 percent of China’s hogs will be transferred to new territory. That’s equivalent to the number slaughtered in the U.S. continued on page 30

2018

Environmental Conference for the Meat and Poultry Industry Environmental issues are top of mind for meat and poultry processors, with increased information and innovation paving the way for improvements. Donâ&#x20AC;&#x2122;t miss this opportunity to learn from expert speakers on the most critical environmental issues and regulatory challenges facing meat and poultry processors today.

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Worker Safety Conference for the Meat and Poultry Industry This conference will address the most critical issues in worker safety and provide practical information and insight to help meat and poultry companies reduce workplace injuries and provide a safe working environment for their employees.

YOUR INDUSTRY. YOUR ASSOCIATION.

January 29-30, 2018

YOUR BUSINESS. IPPE 2018. MEAT Your Future.

Co-located with the International Production and Processing Expo Georgia World Congress Center, Atlanta, GA

annually,” said Feng Yonghui, chief analyst at consultancy Soozhu.com. Temperatures go well below freezing in the winter in China’s northeast, but the area is sparsely populated and allows for setting up large farms that would not be possible in more crowded parts of the country. “The costs in the north-east are higher because of heating. But we can achieve scale there,” said Song Weiping, vice president at Beijing Dabeinong Technology, an animal feed firm that is diversifying into pork production. “We’re building seven farms in the northeast this year. In total, we’ll have around 20 farms in the region.” The output increase in the northeastern provinces would take their share of hogs raised in the country to around 17 percent of the 2016 total and would almost match combined production of 129 million from the top producing provinces, Henan and Sichuan, which currently account for 20 percent of total supplies. Government Push Ramping up output in the northeast will speed up the modernization of China’s hog farming sector, which has been dominated for centuries by smallhold rural familyrun operations. It will also create mega integrated farms that produce everything from animal feed to meat and will be equal in size to the hog stations that have transformed the U.S. market in recent decades. The drive fits with Beijing’s goal to turn its northeastern grain basket into a meat and dairy hub aimed at boosting demand for the region’s main crops, revitalizing some of the country’s poorest regions and fighting farm pollution in populated areas further south. Heilongjiang, Jilin, Liaoning and Inner Mongolia produced more than 40 percent of China’s corn last year. A three-year campaign to crack down on waste has already pushed many smallhold farms out of business. The campaign coincided with a long period of low prices that had already forced many smallholders, concentrated in southern provinces, to leave the business altogether. But as prices spiked last year on the shrinking herd, large farming companies began expanding rapidly, seeking to capture market share once occupied by backyard farms. The share of pigs produced by backyard farms will fall to below 52 percent by the end of 2017, down from 57 percent in 2015, or a reduction of 66 million pigs, said COFCO Meat, a unit of state-owned agribusiness COFCO Corp [CNCOF.UL] in September, citing “huge 30

development space” for large firms. COFCO and others are now “fighting for land” in less developed regions up north, with environmental laws making it almost impossible to get permits for large-scale farms in much of the south, said Martin Jensen, managing director of Carthage & MHJ Agritech Consulting, which manages pig farms in China. Grain Drain Not all of the projects announced will be completed, said experts. Frigid winter temperatures mean construction must stop for months, delaying projects. Still, even a handful of them would reshape grain trade. If 20 million more pigs were raised in the north-east each year, corn needs would increase by at least an annual 4.6 million tonnes, according to Reuters calculations based on estimates that a pig slaughtered at 120 kg would consume around 230 kg of corn over its lifetime. That’s about 12 percent of the surplus corn expected in the northeast this year, according to forecasts from government think tank CGNOIC, draining grain supplies from the biggest southern hog producers, and potentially forcing them to import grain. “The amount of corn transported out of the north-east will fall, and fall very quickly,” said Meng Jinhui, corn analyst at Shengda Futures. Surplus pork output in the north-east should in theory compensate for smaller supplies of grain for feed in the south. But industry experts say farms in the north-east may struggle to get their meat to markets far away. “Consumers still want to consume freshly slaughtered pork that has not been on trucks and trains for several days. That will change, but gradually,” said Fred Gale, senior China economist at the USDA Economic Research Service. Trucking pigs long distances can lead to weight loss and raise the risk of disease. Slaughtering pigs in the north and transporting fresh or frozen meat carries risks too. That could be a boon for exporters though. As production shifts north, major consumption centers in the south may increasingly turn to cheaper imports to boost quality meat supplies, said Pan Chenjun, senior analyst at Rabobank. “There will be a surplus in the north and a deficit in the south. That means China will continue to import meat,” she said. Reuters reporting by Dominique Patton. Additional reporting by Hallie Gu and Beijing Newsroom; editing by Josephine Mason and Raju Gopalakrishnan

MACAULAY WRAPS UP SUCCESSFUL NEW SURREY CHINA AGRICULTURAL TRADE MISSION

SLAUGHTERHOUSE ‘WOULD OPEN DOOR’ TO NEW BEEF MARKETS

Lawrence MacAulay, Minister of Agriculture and Agri-Food, recently wrapped up a successful 10-day visit to China, finishing a series of promotional events and meetings that raised the profile of Canadian agricultural products to our second-most valuable agri-food export market. The three-city mission will help Canada reach its goal platforms, creating good, well-paying jobs in Canada of growing global agri-food exports to $75 billion by and helping to strengthen our middle class.” 2025Proposed by providing Canadians and processors new in Cloverdale 30,000-square-foot beef abattoir wouldto beGuangzhou B.C.’s largest such the facility From Shanghai to Beijing, Minister opportunities to grow their businesses. strengthened Canada’s position as a strong agricultural By Amy Reid, Peace Arch News

A federally licensed beef processing facility is in the works “ CHINA IS CANADA’S SECOND-MOST in Surrey, BC.

VALUABLE AGRI-FOOD EXPORT MARKET, “There’s a new coming forward, a new AFTER THE U.S.building IN 2016, THE VALUE OFabattoir, I think that’s the French pronunciation of slaughterhouse,” CANADA’S TOTAL AGRICULTURE, AGRIsaidAND Councillor Mike Starchuk. “So Surrey have a FOOD SEAFOOD EXPORTS TO will CHINA newer facility with a better capacity so people will have WAS $6.8 BILLION. THIS INCLUDES: the ability to not have to ship an animal to Alberta to have CANOLA SEED ($1.9 BILLION); SOYBEANS it processed. The applications have gone through the ($948 MILLION); CANOLA OIL ($556 Agricultural and Food Sustainability Advisory Committee.” MILLION); DRIED PEAS ($434.1 MILLION); facility is proposed on a 25-acre property within the ANDThe FROZEN PORK ($433 MILLION).

trading partner, and took every opportunity to showcase Canada’s safe, high-quality food products tooperational one of so as to not emit odours. And while there is an the6,000-square-foot world’s most competitive andproperty desirednow, markets for abattoir on the it’s can agriculture. only process a limited number of cattle. Shaun Member of Parliament, Scarborough Chris Chen, Les is general manager of Meadow Valley Meats, North said, “China is now the world’s second the company behind the project. Meadow Valleylargest Meats is economy, Canadian a lot to offer. seeking aand Canadian Foodproducers Inspection have Agency license for Whether it is canola, soy or seafood, our processors the proposed abattoir, to become a federally registered and farmers continueand to expand offer products that are safe and meat establishment the operation. This would of allow the highest quality. Increasing trade between two the meat products to be transported beyond our B.C.’s countries will not only help Canadian businesses, it will boundaries. grow our middle class, create new jobs and increase “Our focus is on trying to bring a more efficient, sustainable our shared prosperity.”

Agricultural Land Reserve at 5175 184th St. The planned local product to the market, realizing we can do that now 30,000-square foot abattoir in Cloverdale would process up Through with his Minister in a verymeetings limited sense,” saidcounterpart, Les. “I caution people when to 100 head of cattle per day. Han Changfu, and with Minister Zhi Shuping talking to them and they say, ‘What a big plant, from that’s going “China is a fast-growing market”, stated Minister According to a city report, that would make it larger than China’s General of Well, Quality to go allow you Administration to go mainstream.’ yes,Supervision, if you look MacAulay. “More and more Chinese consumers are any other processing facility in B.C.. But it would still be Inspection and of Quarantine (AQSIQ), set a path in the context B.C., but this is still ahe very niche plant looking forbythe safe, standards, high-quality food that Canadian small industry compared to the largest meat for continued stable trade for agricultural products, and we’ll serve a niche industry for producers and for the farmers and processors deliver. The Government of processing plants in Alberta that process 3,000 heads of including canola and not meat. market. It’s certainly going to be a monstrosity of a plant Canada working cattleisper day. to get even more of our quality food but it’ll be a big upgrade from the site currently.” products on Chinese store shelves and e-commerce The proposed facility would be fully enclosed and designed Continued on page 32

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TUG OF WAR IS ON IN CANADA’S HOG SECTOR By Phil Franz-Warkentin, Commodity News Service (CNS) Canada

The Canadian hog sector is seeing a bit of a tug of war between competing factors heading into the new year, with support from the rising United States slaughter capacity tempered by the uncertainty of the North American Free Trade Agreement negotiations. Over the past few months, three new slaughter plants have come online in the U.S., with additional capacity also in the works. U.S. packers are killing 15,000 more hogs a day than they were at the same time a year ago, with new records becoming routine. That increased capacity has shifted the dynamic of the cash market, and created a much more competitive environment.

THE PORK SECTOR IS INTEGRATED ACROSS CANADA, THE U.S., AND MEXICO, WHICH MAKES THE ONGOING NAFTA NEGOTIATIONS OF PARTICULAR IMPORTANCE. CONCERN OVER A FAVOURABLE NAFTA DEAL IS STARTING TO CREEP INTO THE MORE DEFERRED FUTURES, WITH POTENTIAL FOR ANY SHIFT OR END TO THE AGREEMENT. Record highs Before this year, the record U.S. daily hog slaughter had been just under 450,000 heads. However, that daily slaughter has topped 460,000 on a number of occasions in recent months. Canadian cash prices compiled by Agriculture and Agri-Food Canada range from about C$149 per 100 kilograms in Saskatchewan to as high as C$186 per 100 kilograms in Ontario. Prices across the country are up by anywhere from 22 per cent to as much as 44 per cent from the same time a year ago. The increased demand and prices mean that packer margins are down by about 50 per cent from where they were last year, with the buyers fighting over a pie that has not grown to the same extent. The hog supply is running about two per cent higher than a year ago, but expectations were for a four per cent increase. That moderating of hog supply is positive for prices nearby. However, on the demand side, there’s a growing concern about exports out of the U.S., with export 32

market struggling compared to the domestic interest. Pork versus chicken and beef Pork appears to be gaining ground against chicken and beef according to some metrics, with improving U.S. economic conditions generally translating into increased meat demand overall. The pork sector is integrated across Canada, the U.S., and Mexico, which makes the ongoing NAFTA negotiations of particular importance. Concern over a favourable NAFTA deal is starting to creep into the more deferred futures, with potential for any shift or end to the agreement. Demand for pork from Mexico could be impacted. Currently, Canada is a major hog exporter to the U.S, and the U.S., in turn, moves pork to Mexico. Any trade disagreements between the U.S. and Mexico could lead to retaliatory measures. As well, Canadian hog prices are based directly off the U.S. market, with anything that happens there translating directly to Canada with the exchange rate on top. Tariffs or other measures on Mexico’s part would lead to lower prices for Canadian hog producers. Canadian numbers Looking at the Canadian numbers, hog exports to the U.S. are actually running 1.8 per cent behind the year ago pace, with 4.64 million hogs crossing south over the border as of Nov. 4, according to Agriculture and Agri-Food Canada data. The domestic slaughter pace, meanwhile, is running 2.2 per cent ahead of the year ago, with 17.90 million slaughtered as of Nov. 11. Total Canadian pork exports are up 4.7 per cent on a volume basis and 7.5 per cent on a dollar basis. Bottom line Canadian hog prices are up over last year and U.S. hog slaughter capacity is also high. The industry, however, is watching trade talks, and hoping for a satisfactory resolution. Phil Franz-Warkentin, of Commodity News Service (CNS) Canada covers agricultural markets for a number of Western Canadian and international publications. Email pfranzwarkentin@cnscanada.ca for more information.

the Canadian Federation of Independent Business (CFIB), I figured I needed to share with our government six ways small business owners (and their income) are different from employees. 1. Risk. Business owners take on huge risks in order to earn a living, and when they do, the entire family is involved. Many business owners empty their savings, remortgage their homes and borrow from friends, family and banks to get their business going. Once it does, they often rely on family members not only for support, but to actively contribute to the business’s success. This is particularly true on Canadian farms, where each family member plays a vital role, often from a young age. If the business fails, and many do, the whole family is often set back for years.

me differently. In fact, Statistics Canada data shows that employers are about four times more likely to be earning less than $40,000 than more than $250,000. To fight these latest proposals, CFIB is a proud member of the Coalition for Small Business Tax Fairness, a unified voice of 50 organizations representing hundreds of thousands of businesses from all sectors of the economy. The Coalition recently sent Finance Minister Bill Morneau a letter asking the government to take the proposals off the table and instead meet with the business community to address the shortcomings in tax policy affecting private corporations. There’s still time for you to have your say. Consultations on the proposal remain open until October 2nd, 2017. Contact your local MP and let them know what the reality is for Canadian small business owners.

LOOKING BACK, CANADIAN ENTREPRENEURS MIGHT CALL 2017 “THE YEAR OF UNCERTAINTY” 2. Getting paid last. A small business owner gets paid AFTER everyone else, including employees, suppliers, and of course, governments. I’ve heard thousands of stories of business owners taking home next to nothing in tough times in order to ensure they could pay and hang onto their valued employees and their business.

3. Working hours. Any agri-business owner will tell you that the nine-to-five doesn’t apply to the farm. More than 40 per cent of Canada’s small business owners work 50 hours or more per week – compared to only six per cent of employees.

By Marilyn Braun-Pollon

4. Benefits. Many employees—particularly those in

Here’s hoping the federal government recognizes the important differences between the income of business owners and employees and abandons these proposals that will harm our entrepreneurs and our economy. This column was first published in the Huffington Post on August 25, 2017. Dan Kelly is President of the Canadian Federation of Independent Business (CFIB). In this capacity, Dan is the lead spokesman and advocate for the views of CFIB’s 109,000 small-and medium-sized member businesses across Canada, including 7,200 agribusiness members. Follow Dan on Twitter @CFIB and learn more about CFIB at www.cfib.ca.

It’s typical this timehealth, of year start on the year that was. Throughout 2017, government—enjoy dentalto and other reflecting benefits it seemed every corner was another government policy creating more courtesy around of their employers. Again, thethere business owner depends onfor theCanadian success of thesmall business to fund anyowners. uncertainty business benefits they or their own family may need.

At the provincial level we witnessed many examples 5. Paperwork and red tape. Think you have struggles of governments introducing roadblocks with more with the Canada Revenue Agency or other onerous labour and employment standards laws – government departments? Consider the massive manynumber comingofhand in hand with sharp increases to the rules, regulations and agencies a small minimum wage. like theWant flu, bad policy spreads, business has Just to deal with. to start a bicycle and what started in Alberta and Ontario not only repair shop in Winnipeg? You will need to register infected but has the potential to start. spread to witheach up toother, 44 different agencies before you neighbouring provinces, as BC and Quebec undergo A Halifax dentist needs up to 45 permits to earn minimum wage and labour reviews respectively. Many a living. of these policies are starting to have an impact – 6. Retirement. This is a big one. While government some,workers like in have Ontario, before pensions they are often evenstarting officially gold-plated at in place,age with no telling what the full brunt of them may 55, and many employed Canadians have bring employer-matched in 2018. RRSPs, the small business owner is counting on theprovinces value of the business—including We also know many are moving forward any investments owned by the corporation—for on carbon policies before the federal governmenthis or her retirement. Succession planning already major announces their own costly carbon taxis plan. While issue for small business owners, especially when it some, like Saskatchewan, are aggressively resisting comes to the agri-business community. When it is the call, others, like Ontario, Alberta and Quebec, easier and more lucrative to sell to a third party than it are moving forward with policies that will have major is to pass your business down to the next generation, negative impacts on small business owners and it threatens the livelihood and very existence of disproportionately the agriculture sector. Canada’s familyimpact farms, something is seriously wrong.

OnSadly, the Ag policy front, July the(and, Federal, there are lots of in Canadians it appears, many Provincial and Territorial (FPT) agriculture ministers politicians) who believe that hanging out a shingle to say announced they had reached an agreement the you’re in business is a licence to print money. Ion represent 109,000 entrepreneurs across every sector, who tell

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next Agricultural Policy Framework, the Canadian Agricultural Partnership. The five-year $3 billion investment into the next suite of agriculture programs, will take effect April 2018. The Ministers also committed to undertaking a one-year review of BRM programming. While reducing red tape – the numberone-ask from CFIB members in a new agreement – was not explicitly part of the agreement, the ministers did recognize the important role that having a strong and effective regulatory approach plays. CFIB will be watching the roll out of this plan closely to ensure there isn’t additional red tape at the farm gate. And then there were the proposed federal tax changes – introduced in mid-July.

WITH ALL OF THE PROPOSALS, THE DEVIL REMAINS IN THE DETAILS AND DETAILS ARE SOMETHING WE REMAIN SHORT ON. STILL, WE LOOK FORWARD TO WORKING WITH GOVERNMENT TO FIND SOLUTIONS THAT DON’T NEGATIVELY AFFECT THE SMALL BUSINESS COMMUNITY’S ABILITY TO GROW AND PROSPER.

Right from the start, CFIB said the federal government’s tax proposals, while intended to target the wealthy, will hurt middle-class business owners from every sector of the economy. The tax changes created unprecedented uncertainty for shop owners, farmers, doctors, financial planners, homebuilders and trades in all sectors. As a result, 78 organizations from across the country came together to form the Coalition for Small Business Tax Fairness — a unified voice to aggressively oppose the federal government’s tax proposals. Let’s start with the good news. After an intense fight over federal tax proposals, the government has started listening to small business owners. They recently announced that they will reinstate their promise to lower the small business tax rate from 10.5% to 9% by 2019, and plan to drop provisions related to capital gains and income stripping. We know the proposed rules would have made it more costly for small business owners – including farmers and fishers – to sell or transfer their business to their children. In the past, CFIB has supported two private members’ bills, from NDP MP Guy Caron and Liberal MP Emmanuel Dubourg - which proposed amendments 34

to a nuance in the Income Tax Act which currently makes it easier to sell a family business to a third party than a family member. We stand ready to work with the government on finding solutions to ensure that intergenerational transfers of small businesses are easier and less costly, while, at the same time, maintaining the integrity of the tax system. The not so good news: While the pause on capital gains changes can be regarded as a step forward, there is still a lot of work and a tough road ahead for Canada’s small business owners on federal taxes. The adjustments made to passive income rules were progress from the original proposal; however, the $50,000 annual threshold may be inadequate for many businesses – particularly for those businesses saving for large investments, innovations or retirement. Similarly, we remain concerned that changes to income sprinkling rules will keep the benefits of business ownership out of the hands of the countless spouses who participate in more informal ways in the business. With all of the proposals, the devil remains in the details and details are something we remain short on. Still, we look forward to working with government to find solutions that don’t negatively affect the small business community’s ability to grow and prosper. And let’s not forget about NAFTA. We were pleased to see that all sides recognized the importance of small business’s role, with a dedicated chapter containing specific measures to help small- and medium-sized businesses trade across borders. However, there continues to be a large amount of uncertainty on issues still being debated by negotiators. Some of the more dire reports say that the negotiations may be souring and it has become difficult to say if a deal will get done. 2017 raised many questions for Canada’s job creators, and there are still two more months to go. Unfortunately it looks like 2018 is shaping up to be more of the same with more uncertainty on the horizon: five years of escalating carbon taxes or pricing strategies (for many provinces), an Employment Insurance tax hike for all Canadians and their employers, followed by five years of Canada Pension Plan premium increases. Not to mention the minimum wage hikes scheduled in many provinces. Marilyn Braun-Pollon is Vice-President, Prairie & Agri-business for the Canadian Federation of Independent Business. She can be reached at mssask@cfib.ca Follow Marilyn on Twitter @cfibsk and learn more about CFIB at www.cfib.ca.

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