Grain Growers of Canada UpdateThe Trans-Pacific Partnership (TPP) is an Asia-Pacific regional trade deal that includes many of Canada’s key export markets and export competitors, including Australia, New Zealand, the United States, Chile, Peru, Malaysia, Singapore, Vietnam and Brunei.
Other potential partners that may join in the near future include Mexico and Japan.
As members of the Canadian AgriFood Trade Alliance, the Grain Growers of Canada, Alberta Barley and many other producer organizations recently submitted comments to Parliament regarding the benefits of Canada entering the TPP trade agreement.
Why is it important?
The TPP group of countries accounts for 65 per cent of all Canadian agri-food trade. The Asia-Pacific region is rapidly growing in economic importance and is a priority market for Canadian agricultural products. All TPP members are already key trading partners.
Canada’s participation in this trade deal would mean significant economic gains for our farmers, value-added processors and exporters through the lowering and/or elimination of tariffs on raw products and tariff escalation on our processed or value-added products.
Why is this important to Alberta barley growers?
There is a substantial market across the TPP for both malt and malting barley.
Through the TPP, Canada’s malt industry could experience unprecedented opportunities for additional exports with Malaysia, Singapore and Vietnam when Canada reaches a more even footing with our key competitors. Alternatively, if we do not become members, Australia and the U.S., which are key competitors for malt exports, could end up gaining a tariff advantage through their current membership in the TPP.
In turn, Canadian malt companies who have facilities in Australia and/or the U.S. could end up relocating their production and sales.
Canada joining the TPP could also positively affect the demand for feed barley. The GGC work very closely with, and in support of, the Canadian Cattlemen and the Canadian Pork Council.
They are major users of feed barley and if they grow their export markets and increase production, this will also drive demand for quality feed here in Canada. To a large degree, if they gain, we all gain.
Japan, which is also applying to join the TPP, is actually Canada’s second largest export market (after the U.S.), so this is a huge opportunity.
Currently, Japan applies high tariffs on many products and imposes non-tariff barriers in a number of areas—for example, both canola and peas face these barriers in Japan.
Because Japan is an important high-value market for Canadian products, a trade agreement with Japan—through the TPP or through a bi-lateral trade deal—could result in more exports of high value Canadian agri-food products.
Japan in many ways is also a good fit because of the country’s shift to Western-style eating habits that have been driving a major shift in consumption patterns.
Accompanying this trend is the demand for ready-to-eat products, and products that are considered healthier or better-for-you alternatives to popular Japanese foods.
Non-tariff trade barriers
To access markets like Japan that want genetically modified (GM) free crops, trade opportunities are only possible if significant other issues are addressed simultaneously.
That is why it is essential for Canada to see improved rules for the regulatory approval of new GM events within the TPP and other ongoing bi-lateral trade deals.
The lack of consistent application, often combined with needlessly long approval processes, can often result in non-tariff trade barriers to Canadian exports.
The federal government needs to put substantial effort into ensuring a fair and predictable science-based approval process for all bio-tech events.
As part of these discussions about the TPP, we respectfully asked the Government to negotiate a reasonable low-level presence (LLP) policy for GM.
Consistent and reliable market access is necessary for Canadian producers and exporters to ensure they have reliable rules for the markets to which we export.
A large multi-lateral agreement on LLP, such as the TPP, could provide the framework for other trade agreements and possibly the World Trade Organization.
An LLP is not about pushing consumer acceptance, it is about ensuring trade continues uninterrupted for minute amounts of mixing that occurs in all grain handling systems.
Lastly, we asked the federal government to negotiate acceptable maximum residue levels with our trading partners. Canada’s active participation in trade deals like the TPP are crucial to the continued success of Canadian farmers.
Strong and diversified export markets will help ensure that we, as farmers, can continue to grow and be prosperous through having the necessary opportunities to market our crops.