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doesn’t guarantee receptiveness. Consumer trends and
expectations are the next hurdle after access. Food purchases
are based on many requirements, said McInnes, including
where and how it’s grown, its nutritional content and its
ecological footprint.
“Those are complex factors that retailers, processors and,
increasingly, producers have to be more and more cognizant of
to ensure we’re ready to access markets.”
McInnes is confident this will pay off.
“Consumers around the world will increasingly seek out
Canadian food and ingredients because of their quality, safety
and nutrient profile, perhaps even around how we manage
our land, water and soil,” he said. “Discerning consumers from
Beijing to Berlin will increasingly look at
those attributes. Canada’s in a very good
spot to serve those high-end markets and
other markets, as well.”
Awealth of benefits
Given the scope of the preparation
required, taking a couple of years to
gear up appears prudent, especially
for small and medium-sized enterprises
(SMEs). According to Peter Kuperis,
director, domestic and international trade
policy with Alberta Agriculture and Rural
Development, while large ag corporations
may be ready to take on new markets,
SMEs require greater prep time.
Kuperis went on to list a wealth of benefits the recent
agreements offer Alberta’s ag industry: CETA will reduce the
cost of doing business with the EU as tariffs drop and improve
access to this $78.9-million wheat market and $48.9-million
durummarket. Wheat tariffs will be reduced to zero over seven
years, as will canola seed and canola oil tariffs. A historically
small canola market, the EU’s $23.6-million biodiesel market
is growing. As well, when tariff escalation is done away with, it
will become more feasible to produce higher-value agricultural
products in Canada for export.
To be phased in over five years, CETA will also bring
increased quota access for livestock. This will include duty-free
access for 64,950 tonnes of Canadian beef valued at nearly
$600 million annually. Access will also be granted for up to
80,000 tonnes of pork and 3,000 tonnes of bison. Better
livestock pricing and feed market expansion may lead to better
prices for feed grains and will increase the volume of feed sold.
Better market access may generate similar spinoff in processed
meats and pet food.
Kuperis also pointed to the attractiveness of investment
provisions in the EU deal, suggesting they may attract
European investment in the Canadian food-processing
industry.
“We’ve got high-quality commodity products, and
Europeans are known for being sophisticated in food
processing,” he said. “We think there’s a good match up
there.”
Also of note, he explained that the sanitary and phytosanitary
portion of the agreement is a strong means to discipline
unjustified or unscientific trade barriers, including canola
biotechnology issues and complications with variety
registration and recognition. As well, common to the
agreements, Kuperis pointed out, is trade facilitation, a
decorative term for the crafting of smooth and predictable
customs procedures.
While the CKFTA will see some lengthy phase-outs,
including up to 15 years for barley, the existing 10 per cent
tariffs on canola seed and wheat will
drop immediately upon implementation,
while other canola products will see
five- to seven-year phase-outs. Canadian
wheat exports to South Korea represent
an annual value of $273 million, and this
number will potentially grow. South Korea
was also a $50-million Canadian beef
market in 2002 prior to the BSE closure,
and Canada Beef predicts renewed
exports may hit $65 million by 2020.
The Canadian Agri-Food Trade
Alliance (CAFTA) has pushed for a strong
TPP agreement, said Executive Director
Claire Citeau. Though the agreement
will not change existing commitments,
she said it may improve the market access conditions in these
countries. The ag sector expects to benefit from the creation
of a plurilateral agreement, she added, meaning equal access
for competing products across the region.
“The TPP has the potential to improve the competitiveness
of our economies and enhance regional supply chains by
permitting the production, processing and movement
of products and ingredients among TPP countries where
competitive advantages exist,” she explained.
Citeau emphasized that Japan must import 60 per cent of
its food, and given that Canada can supply ag products that
satisfy its traditional dietary needs, the existing positive trade
relationship between the two nations can only improve.
“An agreement with Japan will provide Canada’s agriculture
stakeholders with the opportunity to broaden and deepen the
trading relationship with the Japanese market, which is critical
to Canada’s growth and economic prosperity,” she said.
GET MOVING
In the past, trade agreements have not always been followed
up with assistance to exporters in accessing new markets. Fast
said this is no longer the case.
“It’s now time for Canadian companies to get serious about
exporting beyond North America,” he said.
Winter
2015
Grains
West
40
“Consumers around the
world will increasingly
seek out Canadian food
and ingredients because
of their quality, safety and
nutrient profile, perhaps
even around how we
manage our land, water
and soil.”
–David McInnes