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Development of the Next Generation of Agriculture and by kjv35748


									Development of the Next
Generation of Agriculture
 and Agri-Food Policy

Introduction to Consultation Sessions

        December 2006


Current Agricultural Policy Framework

Why are we developing a new framework now?

What are our goals for consultation?

How are we achieving this?

What is the broad context as we develop the next
     Current Agricultural Policy Framework
In 2001, Federal-Provincial-Territorial (FPT) Ministers agreed
that the agricultural sector needed a more sustainable and
long-term approach
The result was the Agricultural Policy Framework (APF) – a
five-year FPT agreement on agriculture that came into force
in 2003
APF was developed to strengthen the agriculture and agri-
food sector through a comprehensive and integrated national
policy with five pillars
   Business Risk Management
   Science and Innovation
   Food Safety and Quality
   International dimension emphasized as a cross-cutting theme

Why are we developing a new framework now?

Global and domestic situation for agriculture and agri-food
sector has changed considerably in the last three years

Most of the agreements that allow for APF programming expire
in March 2008

FPT Ministers committed to broad, multi-phased national
consultations across the value-chain and with Canadians
generally to guide the development of the next generation of
agriculture and agri-food policy

     What are our goals for consultations?

Develop and refine policy options to support a
competitive and profitable agriculture and agri-food

Specific consultation objectives:
   Help governments prepare a framework for FPT negotiations
   Promote frank and honest discussion
   Ensure wide range of stakeholders and experts are engaged
      Industry associations and grassroots producers
      Processing, retail and food service industries
      Agricultural value-chain players
      Experts from academia and think tanks

            How are we achieving this?

Broad, national consultations are centered around five thematic
   Food Safety and Quality
   Innovation and Science
   Market Development and Trade

Seeking input on whether a different approach could better
encapsulate a potential new policy direction

Consultations on BRM programming will also be held

       How are we achieving this? (cont’d)
Consultations are being structured into three rounds
   Round One (December 2006)
       Structured by the five thematic areas
       Small number of locations

   Round Two (January – February 2007)
       Builds on feedback from Round One
       Multiple public consultation events across Canada
       Consultation sessions on the new BRM suite will also be held

   Round Three (Spring 2007)
       Based on outcomes of Rounds One and Two
       Input into the next generation framework for FPT negotiations
       Small number of locations
       Format to be determined

Process complemented by provincial and territorial
consultations in some regions

What is the broad context as we
 develop the next generation?

What is the broad context for the next generation?
 Agriculture and agri-food is an important part of Canada’s
    Contributes $150 billion annually to Canada’s GDP
    Largest economic sector in several provinces
    Includes producers, input suppliers, food processors, food
    services and retailers

 Sector has undergone significant structural changes in recent
    Aggregate farm income remains in steady decline
    A smaller number of farms produce a greater amount of product
    Agriculture leads the Canadian economy in productivity growth

 Stakeholders are already providing suggestions
    FPT Ministers have heard from stakeholders across the country
    Industry groups, academics and think tanks putting forward a wide
    range of ideas                                                    9
There are a number of challenges facing producers
Canadian producers face declining global commodity prices and
low farm income because of:
   Low-cost, high-output competitors and subsidized producers
   Worldwide productivity advances in agriculture
   Rising input costs which are squeezing profit margins
   Appreciated Canadian dollar

                                        Percentage of producers who reported
 Agricultural production             undertaking some new business venture over
 faces ongoing pressure                           the past five years

 for adjustment              introducing value-added products             11

                                  starting a non-farm business            11

 Farm families are            diversifying into other agricultural

 adjusting by seeking                expanding their operation                                 48

 income from program                                         total                                       65

 payments and non-farm                                         %     0   10    20   30    40   50   60   70
    The processing industry also faces challenges

                                                          Structure of the food and beverage
Profit margins                                                    processing sector
challenged by rising                                                 (1990-1999)
costs and the
                                                    3.9                                                         25
availability of inputs

                         Number of establishments

                                                                                                                     Shipments per establ.
                                                                              Shipments per establishment
Processing sector is                                3.5

                                                                                                                          (Millions $)
also facing pressure                                                                                            15

for structural                                                                                                  10
adjustment                                          3.1                Number of establishments

                                                    2.7                                                         0
                                                          1990     1992      1994       1996       1998

                                                      Note: Data has been adjusted to exclude retail bakeries
                                                      Source: Statistics Canada

  At the same time, a wide range of opportunities
Globalization has vastly expanded the reach of Canadian agri-
food and non-food products and services, especially value-
added, processed goods
   Increased market access around the world

   Expanding middle classes in high-growth, emerging nations

   Growing consumer demand for safe, high quality food that Canada
   is known to produce

   Increasing demand for biofuels, bioprocesses, and other
   technological advances that can build on Canada’s status as a solid
   science-based regulator

   Demand is also increasing for a greater array of food with new

   Opportunity to capture benefits of innovation

Before we turn to today’s thematic discussion specifically, are
there any questions on the context for the consultations?


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