Value Chain Roundtables Moving Forward

							Canada’s Value Chain Roundtables: Building Relationships to Better Meet Consumer Demands and Influence Agricultural Policy

Janice Vansickle Executive Director, Branding Management, International Markets Bureau Markets and Industry Services Branch Agriculture and Agri-Food Canada
OECD Food Economy Conference 2007

Workshop 2.1 Supply Chain Management The Hague, Netherlands October 18, 2007

Overview
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Importance of Value Chains Canada’s Value Chain Approach Impact Lessons learned Future Directions

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Importance of Value Chains
Value Chain vs. Supply chains
Agriculture and Agri-Food Canada experience:
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Value chains develop national-level strategies for success Greater scope, higher-level than supply chains, which typically are limited to transactions between adjacent segments of the chain, i.e., vertical coordination Both allow for relationship-building and informationsharing All players representing all segments of the chain have a voice

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Importance of Value Chains
A competitive edge through collaboration

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Agriculture sector important to Canadian economy, Canada a major exporter of agriculture and agri-food products

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Canada’s industry is facing challenges, including increased competition; but also emerging opportunities Through collaboration, value chains can work to provide greater profitability for all stakeholders Action plans developed to maximize domestic action so a competitive advantage can be gained internationally and deliver on our brand promise

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Importance of Value Chains
An “umbrella” model that creates partnerships

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Canada established industry/government Value Chain Roundtables to create high-level partnerships Umbrella model enables partnerships to flow down and strengthen supply chain relationships
Value Chain concept is gaining popularity elsewhere in Canada
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wide recognition that stakeholders need to put aside differences, see their interdependencies and work together

Canada’s Value Chain Approach
Aligning the industry for action
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Full value chain analysis of markets and formation of strategies – instead of aligning one set of players, broader industry aligned

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Not forums for lobbying government – they should focus on areas where industry must lead, in addition to issues where government has a role Ensure value-chain perspective (processing and other post-farm gate segments) to inform policy development

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Canada’s Value Chain Approach Participants and Structure
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First roundtables established in 2003 reflected key subsectors: beef, cereal grains, horticulture, oilseeds, pork, seafood and special crops (organic added in 2006)

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Roundtables chaired and led by industry Each roundtable is customized – individual working groups are dedicated to key issues (marketing, innovation, regulations, etc.) AAFC organizes meetings and funds benchmarking studies, research and analysis

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Canada’s Value Chain Approach
Engage all key players

Provinces
OGDs

Input supplier

Producers
Processors

Further Processors Regulators
Food Service

AAFC

Traders

Retailers

Experts Panel

Canada’s Value Chain Approach
Good things happen when players work together

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Building a collective vision requires:  information sharing  trust  joint decision-making
Value Chain Roundtables help build relationships among all players to make this possible This enables them to know what they need to deliver – individually and collectively – to meet customer demands

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Canada’s Value Chain Approach
Examples of relationship-building
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Beef roundtable was platform for BSE crisis response
Seafood roundtable is only forum where industry can speak with one voice at national level Special Crops roundtable collaboration helped shift from commodity marketing to increased value-added

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Relationships formed at pork table are helping that industry deal with current competitive challenges

Impact
Influence on policy environment
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Industry input helps inform government policy development

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VCRTs provide government with a better understanding of industry conditions for success VCRTs provided input into new “Growing Forward” national policy framework

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Impact
Influence on policy environment, meeting consumer demands
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Regulatory environment affects ability to seize value-added opportunities:
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capitalizing on them is key to the sector’s profitability

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Opportunities for value-added, product differentiation:  health agenda (nutraceuticals, functional foods, etc.)  increased quality  organically-produced  animal welfare requirements Sector must be capable to respond to consumer demands for new products, i.e., need the ability to make health claims Through VCRTs, AAFC is linking industry concerns to new policy objective, which will include an approach to meeting regulatory objectives consistent with a competitive market economy Programming influenced also – Organic VCRT reviewing relevant policies with a view to initiating beneficial modifications

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Impact
Influence on policy environment, meeting consumer demands
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VCRTs have influenced other policy areas:
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Food safety – a integral component of VCRT strategies Research, science and innovation -- Beef roundtable exploring development of a national research plan to improve coordination with government and industry

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Environment -- Seafood VCRT is engaged on strategies to meet “Marine Stewardship Certification”
Market development – VCRTs are a good forum for diffusing and analyzing market research Sector brands aligning with national brand

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Lessons Learned Persistence and Patience
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Persistence and patience – value chain relationships are key to achieving long-term strategies, but they take time to develop Disparate interests can lead to tensions and inhibit consensus-building

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Requires industry leaders with a “big-picture” viewpoint – environment must be conducive to objective discussions Be prepared to shift mindsets from transactional issues to more strategic long-term strategies

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Future Directions
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Ensure the Value Chain Roundtables’ mandates fully support new policy directions Increased linkages between value chain roundtables Enhanced synergies and integration of the roundtables with the policy/programming of Agriculture and Agri-Food Canada and other departments/agencies Value Chain Roundtables well-positioned to help the sector meet challenges, leverage opportunities and become more innovative and profitable

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Thank you
Questions?
For more information: www.roundtable.agr.gc.ca