Federal agriculture minister Gerry Ritz wants to see more money spent on value added processing under the next generation of farm programs.
“The weak link in our whole system in Canada is processing, value adding,” he said.
That is one of the key changes Ritz will be pushing for in Growing Forward 3, the next agricultural policy framework.
He said he has noticed during his extensive travels on trade missions that Canada’s value-added products are not meeting the needs of foreign customers.
“There has been a sea change in what the Pacific Rim asks for,” he said.
For example, Canadian meat processors tend to produce eight, 10 or 12 ounce steaks, which would feed an entire family in China. The Chinese want much smaller cuts of meat.
“We have to learn how to sell what they want, not what we have,” said Ritz.
That is why the government is spending $3.8 million to build the Canadian Beef Centre of Excellence in Calgary.
It will educate foreign buyers on what to expect from Canadian beef, but it will also bring in meat cutters from export markets to educate Canadian processors.
“How do we carve up our beef to better serve your market? How do you want it?” said Ritz.
That is the kind of value-added project Ritz would like to see funded through Growing Forward 3.
Another example is the work that the Canadian International Grains Institute, Cereals Canada and the Canadian Grain Commission have been doing.
They have been travelling the world learning how to make Canadian grain, oilseed and pulse products better suited to customer needs, such as how to create a pea flour that can be used to make vermicelli noodles in China.
Ron Bonnett, president of the Canadian Federation of Agriculture, thinks Ritz is on the right track.
“I think he has likely got the focus close to where we should be,” he said.
Bonnett said it closely reflects what groups like the Canadian Agri-Food Policy Institute and the Conference Board of Canada are saying about how the food processing sector has to become more responsive to customer needs.
However, the money can’t simply be targeted at the processing sector. Instead, it has to benefit everyone in the chain all the way back to the producer.
Bonnett used Ritz’s beef cut example as a case in point.
“Right now the pricing system is set up (where) those big carcasses are what make people money all along the line,” he said.
A market signal is needed that rewards farmers for producing the types of animals processors and end customers are seeking.
Bonnett said the value-added expenditure falls under what he considers the strategic investment arm of Growing Forward 3. The other arm is business risk management.
On that front, the CFA would like to see improved disaster assistance programs as well as new tools to mitigate risks, such as expenditures on water escape routes to protect farmers from spring floods.
Ritz said Agriculture Canada officials are busy analyzing what worked well in Growing Forward 2, which expires in 2018. It is already clear that there will have to be continued expenditure on innovation and research and development.
He would also like to see funding devoted to combating some of the misinformation about agriculture that is making the rounds these days.
“Just telling the good story that we have in agriculture to folks in urban settings,” said Ritz.
“I’ve got kids in the classroom in my own riding that think milk comes off the shelf at Safeway. They have no concept of how it got there and the work that’s involved.”