AFTER months of angst about a lack of Canadian livestock processing capacity in the face of a closed United States border to live cattle, is Canada over-reacting by building too much capacity?
Paradise Valley, Alta., grain producer and farm co-operative leader Bill Dobson spoke before a Senate committee last week about a topic that haunts governments, lenders and potential investors in new slaughter plant capacity.
What happens if plants are built, the border opens and American packing plants desperate for stock offer premium prices?
Will Canadian farmers send their cattle south, bypassing plants built when a closed border made them seem to be essential?
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It is a scenario that has led lenders and agriculture minister Andy Mitchell to insist any new plant approval must be based on a business plan that does not presume a closed border.
Yet last week, Nova Scotia Liberal senator Terry Mercer wondered if the country is heading for “an excess of capacity” despite the caution.
Dobson said it is possible, if government does not step in to co-ordinate what plants are needed and which ones fit into a national packing capacity strategy.
“If all the initiatives that are (proposed) were to come to fruition, there is no doubt that there would be immediate overcapacity and that certainly would be a challenge,” said the Alberta farm leader and vice-president of the Canadian Co-operative Association.
Well, rather than dream of some government oversight that is not going to happen in these days of political dithering and uncertainty, let’s imagine another way to ensure that Canada does not revert to May 19, 2003 American-dependence once the border is open.
Imagine a day in the House of Commons during introduction of proposed bills from backbench MPs, bills that normally go nowhere but occasionally get passed:
Mr. Speaker: I recognize the member from Gatineau Hills-Shangri-La.
The Hon. Member: Mr. Speaker, I propose Bill C-969 as a way to reduce the flow of cattle south even if the border opens, to make sure new Canadian slaughter plants can compete even if the border opens and Americans are offering premiums.
Briefly, Mr. Speaker, my bill would authorize levying a $50 charge on every animal leaving Canada to be slaughtered in the United States. It is not so high as to entirely end north-south trade but will deter some trade and make local plants $50 more attractive. More importantly, the tens of millions of dollars raised from this levy will be invested in the domestic slaughter-packing industry, helping it have the best testing, trace back and environmental systems in the world.
I hear critics across the aisle say this may be World Trade Organization incompatible, may be challenged by the Americans as a trade barrier. Given their flouting of trade law and their egregious subsidy practices, I say to a potential American challenge, who cares?
Mr. Speaker, I believe our new slaughter plants need a year or two to develop a loyal customer base. A $50 incentive may do that.
I ask unanimous consent for passage of this bill.
Mr. Speaker: We have heard the motion on C-969 from the member from Gatineau Hills-Shangri-la. Is it agreed?
OK then. Let’s give it a try.
