On Friday, U.S. Agriculture Secretary Sonny Perdue visited the farm of Canadian Agriculture Minister Lawrence MacAulay in the idyllic province of Prince Edward Island, best known as the fictional home of Anne of Green Gables.

Between meetings, the two men hauled up lobster traps and strolled the red earth of a potato farm.

Canada’s protected dairy industry was a key issue for discussion after Trump renewed his attack on the sector for its high tariffs.

A supply management system matches Canadian production to domestic consumption, sets prices and imposes high tariffs to limit imports.

Perdue said on a conference call with reporters after the meetings that it was not the United States’ place to tell Canada it could not have a supply management system. But he said Canada’s system cannot result in oversupply of some products on the global market that depresses prices.

Perdue said the U.S. was likely to reach a trade deal with Mexico before Canada, with whom it has “intractable issues,” although he said he was still optimistic of reaching an agreement.

Canadian dairy officials have said U.S. overproduction due to subsidies was responsible for weak global prices.

MacAulay said earlier Friday that he and Perdue were not prepared to signal what changes might be coming in the North American Free Trade Agreement (NAFTA) or within supply management “because that’s the job for the people at the table.”

Negotiations on NAFTA have been overshadowed by Trump’s imposition of steel and aluminum tariffs, and Canada’s vows of retaliation.

With Trump and Trudeau out of step, the best hope for a breakthrough may come from Perdue and MacAulay, both 71, although direct trade negotiations are handled by the U.S. Trade Representative and Canada’s Foreign Minister.

The rapport between MacAulay, a former dairy farmer, and Perdue, the former Georgia governor, is “comforting,” said Ron Bonnett, president of the Canadian Federation of Agriculture.

“They might be the two people who can help find common ground,” he said.

The U.S. and Canadian farm sectors are better off working together than apart, said Kent Bacus, director of international trade and market access for the U.S.-based National Cattlemen’s Beef Association.

“Minister MacAulay and Secretary Perdue, they already have a strong relationship, and at times like this you really need to lean on those types of relationships,” he said.

Trade in farm products between the countries amounts to $47 billion annually, split roughly evenly, according to Agriculture and Agri-Food Canada. Huge volumes of meat and grain, as well as pigs and cattle cross the border daily.

Still, the issues can generate friction.

Perdue said on Friday that a 2016 pricing agreement, called Class 7, struck by Canadian dairy processors and farmers to allow processors to produce milk ingredients at globally competitive prices and limit imports from the U.S., was a key focus.

“I don’t know how we can go forward if Canada insists on a Class 7 part of their program.”

— Reporting for Reuters by Rod Nickel in Winnipeg and Tom Polansek in Chicago.

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Federal Agriculture Minister Lawrence MacAulay on Monday launched the fund, to flow through what’s dubbed the Agricultural Clean Technology (ACT) Program.

ACT, which is to be available until all its funding is allocated or the end of March 2021 at the latest, is meant to support “research, development and adoption of clean technologies through investments in, and promotion of precision agriculture and agri-based bioproducts.”

Eligible technologies, the government said, “will help to reduce greenhouse gas emissions, generate a wide range of positive impacts, and promote sustainable and clean growth.”

ACT support will be offered in “non-repayable” contributions from Agriculture and Agri-Food Canada for projects delivered by provincial and territorial governments.

An ACT program guide will be available for applicants “in the coming weeks,” the government said.

The government in its release defined precision agriculture as “a farming practice that uses data gathering technologies to guide targeted farm management actions that improve the sustainability, efficiency and productivity of agricultural operations.”

Bioproducts, in the same release, were defined as “renewable products from agricultural waste and outputs.”

AAFC, in its release, cited Statistics Canada as estimating the clean tech sector covers over a quarter of a million jobs in Canada, with an average salary of over $90,000.

ACT, MacAulay said, “will contribute to Canada’s place as a world leader in agricultural clean technology, helping farmers to develop new and efficient uses of energy, while also protecting our environmental resources and mitigating climate change.”

MacAulay and Ontario MP Francis Drouin announced the program Monday at Terryland Farms, a dairy operation at St-Eugene in eastern Ontario.

Terryland, which since 2006 has used a biodigester to generate electricity and heat, is billed as the first farm in the province to sell power generated from ag waste back to the provincial grid.

The farm, Drouin said, “is a perfect example of what can be achieved with sustainable and clean technology practices.” — AGCanada.com Network

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Spearheaded by the year-round industry-backed initiative Agriculture More Than Ever, Canada’s Agriculture Day is set this year for Tuesday (Feb. 13).

“It’s a time to showcase all of the amazing things happening in Canadian agriculture and help consumers see the connection to where their food comes from and the people who produce it,” Candace Hill, manager of Agriculture More Than Ever, said in a recent release.

The organization, which launched the event last year, has produced materials such as graphics, logos, sample tweets and other items for farmers to share via social media “conversations” online, and has also connected the day to a series of events across the country. Attaching hashtags such as #CdnAgDay and #FarmLife to farm and food photos on social media is also encouraged.

“Canada’s agriculture and agri-food sector contributes over $110 billion to our economy and Canada’s Agriculture Day is an excellent opportunity to take stock of our success and celebrate,” federal Agriculture Minister Lawrence MacAulay said in the same release.

The day’s marquee event, in Ottawa, is scheduled to include speakers “geared to building a better understanding and appreciation of the industry, as well as inspiring young people to consider the career opportunities in agriculture and agri-food.”

Among the speakers and panelists on deck for the Ottawa event are MacAulay, Quirks and Quarks host Bob McDonald, Save-On Foods president Darrell Jones, Richardson International CEO Curt Vossen, AGT CEO Murad Al-Katib, Canadian Federation of Agriculture president Ron Bonnett and Farm Credit Canada CEO Michael Hoffort.

MacAulay on Tuesday afternoon is also scheduled to formally launch federal programs and activities under the Canadian Agriculture Partnership, the federal/provincial successor to the current Growing Forward 2 ag policy funding framework.

Crystal Mackay, president of the Canadian Centre for Food Integrity, noted in the same release that Canadians in a recent survey consider farmers among the most credible sources of information when making informed decisions about food.

“Farmers and the entire food system have a great story to tell which helps earn consumer trust and confidence in food,” Mackay said. “Consumers want to know
more, and Canada’s Agriculture Day is a great way to start the conversation in person and on social media.” — AGCanada.com Network

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“Because of the NAFTA negotiations going on, we have to be careful what we say publicly,” MacAulay said at the Dairy Farmers of Canada policy conference this week in Ottawa, after multiple questions on trade policy from farmers.

“I’ve been quite clear and publicly said what I thought about what they put on the table. What Americans put on the table is a non-starter,” he said.

The U.S. proposal on supply management was to dismantle the system over the next decade. The Liberal government has repeatedly supported the maintenance of supply management, but has not been willing to guarantee access to the Canadian dairy market will not be granted under a new NAFTA.

The current NAFTA does not include dairy products.

Dairy farmers pushed MacAulay on NAFTA because of U.S. threats and the recent agreement that Canada would join the Comprehensive Progressive Trans-Pacific Partnership (CPTPP).

When the original Trans-Pacific Partnership was negotiated, the U.S. was also involved and were part of the 3.25 per cent access provided to Canada’s dairy market for TPP countries. The new agreement didn’t include the U.S., as President Donald Trump withdrew from the pact.

However, the 3.25 per cent access remains for CPTPP countries such as Australia and New Zealand, which previously would have had to share the 3.25 per cent with the U.S.

Thus, if there’s access to the Canadian dairy market negotiated under NAFTA, dairy farmers will lose more market share than they expected to the U.S. under CPTPP.

Ralph Dietrich, chair of Dairy Farmers of Ontario, told MacAulay he agreed with the minister’s remarks that dairy farming is a great industry and it has a bright future, “but the way for that to continue is to tell the U.S. to go through the CPTPP.”

MacAulay also refused to say if the government would have a program to help dairy farmers adjust to increased imports under CPTPP, as it did under the Comprehensive Economic and Trade Agreement (CETA) between the European Union and Canada.

MacAulay highlighted the $250 million for producers and $100 million for processors in the CETA adjustment fund. He said 500 projects have been approved worth $23.5 million.

There needs to be more industry consultation before a CPTPP adjustment program is created, MacAulay said.

“We will come up with a program that will make the dairy industry stronger than it has ever been. For me to just tell you that I’m going to have the solution right here and now, it would be totally inappropriate,” he said.

— John Greig is a field editor for Glacier FarmMedia based at Ailsa Craig, Ont. Follow him at @jgreig on Twitter.

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In 120 words Trump told the American Farm Bureau Federation’s annual meeting Monday in Nashville he was working to get U.S. farmers better trade deals.

“To level the playing field for our great American exporters, farmers and ranchers as well as our manufacturers, we are reviewing all of our trade agreements to make sure that they are fair and reciprocal,” Trump said. “Reciprocal, so important.

“On NAFTA I am working very hard to get a better deal for our country and for farmers and for our manufacturers.” he said, triggering applause.

“It’s under negotiation as we speak. But think of it, when Mexico is making all of that money, when Canada is making all of that money, it’s not the easiest negotiation. But we’re going to make it fair for you people again. Now we want to see even more victories for the American farmer and for the American rancher.”

The farm bureau, like many other U.S. farm organizations, has urged the U.S. government “to do no harm” in the North American Free Trade Agreement (NAFTA) talks triggered by Trump soon after his election last year.

Trump, who pulled the U.S. out of the Trans-Pacific Partnership (TPP), has said he will tear up NAFTA if he can’t negotiate better terms for the U.S.

While most observers agree Trump can abrogate the 23-year-old agreement by giving Canada and Mexico six months’ notice, it’s also believed the U.S. Congress could save the agreement that resulted in US$60 billion in agricultural trade between the three countries last year.

AFBF president Zippy Duvall on Sunday stressed the importance of trade to farmers.

“Without those global markets, our already-depressed farm economy would go down even more,” he told the meeting. “Trade should not be a dirty word.

“We sell about half of what we produce to foreign markets around the world. If we lose those markets, where is that agricultural production going to go? Ag trade is an American success story.”

Later that day Canada’s Agriculture Minister Lawrence MacAulay also promoted free trade.

“My message to you this morning is the government of Canada is committed to working with you to strengthen (the) Canada-U.S. relationship for the good of our people, our businesses and our economy,” said MacAulay, the first Canadian agriculture minister to address the 99-year-old farm organization.

“The fact of the matter is we’re friends whether we like it or not. We’ve worked together too long.

“No two nations depend on each other more for their prosperity and for their security than Canada and the United States. And today that is even more vital than ever.”

MacAulay emphasized NAFTA and trade are important for Canada, the U.S. and Mexico. Since NAFTA came into force, its partners’ agricultural trade with each other tripled, while U.S. ag trade to Canada and Mexico quadrupled.

“Last year more than US$47 billion (C$60 billion) worth of agricultural products passed over our borders,” he said. “That includes more than $600 million right here in Tennessee.”

MacAulay said the U.S. has an $8 billion goods and services trade surplus with Canada; Canada is the top export market for two-thirds of U.S. states and trade with Canada supports nine million jobs — 170,000 in Tennessee alone.

MacAulay’s speech wasn’t all facts and figures. He employed some ‘down east’ charm delivered in a warm Prince Edward Island lilt that garnered laughter and applause.

“I think you are fortunate to have Sonny Purdue as your secretary of agriculture in Washington,” MacAulay said. “And he’s a good friend of mine. And he’s a farmer and I am. And he knows what we think.”

MacAulay spoke about their first meeting after he heard Purdue wanted to meet.

“I can tell you if the secretary of agriculture for the United States of America wants to see me he’s going to see me,” MacAulay said. “That’s the way this works.”

Noting trade is a two-way street, MacAulay said Canada has exported “pretty important stuff” to Nashville “like Shania Twain.”

And with the Nashville Predators looking like they could be in the Stanley Cup playoffs thanks to former Montreal Canadiens player P.K. Subban, MacAulay said: “I can tell you I want the Predators to help me on any trade deal.”

Later at a news conference in Nashville, MacAulay said Canada will not forsake Canada’s supply-managed dairy sector.

All countries have sensitive areas, he said, especially in agriculture, including the U.S., which protects sugar production.

Former Canadian agricultural trade negotiator Mike Gifford, noting Canadian dairy production is rising, has suggested a Canadian compromise would be to allow more U.S. milk to enter Canada by increasing tariff rate quotas.

Asked Monday about the idea by Canadian reporters, MacAulay said, “It has been made very clear myself and our government that we are going to fully support the supply management system because it has been, without a question, a model for the world.

“We see absolutely no reason to change our system. All counties have certain things that they wish to protect.

“The fact is, why would you dismantle a system that is so efficient?” he said in response to another reporter’s question.

‘Regulatory assault’

Much of Trump’s speech focused on the improving U.S. economy and reduced unemployment, for which the president took credit.

He also said farmers would be among the beneficiaries of the recently passed federal tax cuts, including farm family estates.

Trump also touted his cuts to regulations, including some aimed at protecting the environment, which he said got in farmers’ way.

“We are also putting an end to the regulatory assault to your way of life,” Trump said.

“For years many of you have endured burdensome fines, inspections, paperwork and relentless intrusion for an army of regulators at the EPA (Environmental Protection Agency), FDA (Food and Drug Administration) and countless other federal agencies.”

“We are streamlining regulations that have blocked cutting-edge biotechnology, setting free our farmers to innovate thrive and to grow. Oh, are you happy you voted for me. You are so lucky that I gave you that privilege.”

After his speech Trump signed an executive order promoting the expansion of broadband internet in rural areas.

— Allan Dawson is a reporter for the Manitoba Co-operator at Miami, Man. Follow him at @AllanReporter on Twitter.

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The funds announced are to help create a completely new cow-calf and heifer research facility next to the current beef research station, and a new cattle finishing facility after the demolition of some of the current buildings.

Research on genomic testing of cows will also be funded by the money announced during an event Thursday at the research station near Elora.

Jeff Leal, Ontario’s minister of agriculture, food and rural affairs, announced $12.4 million in funding for the project.

“This new facility will develop new methods and best practices for more efficient and sustainable beef production, bolstering what is important to us all, the economic competitiveness of Ontario’s beef sector,” said Leal, lauding the groups and organizations that worked to make the beef research facility happen.

“Ontario will continue to be an international leader in livestock research,” he said.

Stewart Cressman, chair of the Agriculture Research Institute of Ontario — which owns and funds agriculture research facilities in the province — said he knows how difficult it is in other parts of the country and the world to get livestock research facilities funded.

“We are very privileged to have a government that invests in livestock research,” he said, adding that such investments are important for the future competitiveness of Ontario and Canadian agriculture.

Such facilities are also necessary for the university to continue to attract leading researchers from around the world to Guelph, said Daniel Atlin, the university’s vice-president, external.

“This facility will have impacts locally, across the province, nationally and around the world,” he said.

Bringing in top faculty, with top research facilities also attracts students, said Rene Van Acker, dean of the Ontario Agriculture College.

It’s a challenge for the university to attract students to its agriculture programs — despite multiple jobs awaiting each graduate — and facilities like the beef research station will help, he said.

Lawrence MacAulay, federal minister of agriculture and food, announced $2 million in support for a genomic project with Beef Farmers of Ontario to profile cows in Eastern Canada to improve feed efficiency.

A one per cent improvement in feed efficiency can result in annual savings of $11.1 million for the beef sector, he said. It also helps reduce costs at the farm and reduces methane and manure volumes.

In the long term, the facility will help farmers who are dealing with more public pressure on environmental practices, said Joe Hill, vice-president of Beef Farmers of Ontario.

“As an individual farmer it is harder to address these things, but at a research scale, we can sort out where the issues are and how to best manage them at a farm level. It is going to save farmers a lot of time and energy trying to sort through what their options are and how to meet these challenges.”

The facility will help beef producers remain competitive and able to take advantage of trade opportunities, he said.

The beef facility has been many years in planning and is the second major livestock facilities investment at the university, after the large dairy research facility which opened in 2015.

Work is expected to begin this fall on the beef cow research facility, with the feedlot facility after that, and completion expected by sometime in 2018.

— John Greig is a field editor for Glacier FarmMedia based at Ailsa Craig, Ont. Follow him at @jgreig on Twitter.

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However, some “irritants” are present for each country in the runup to NAFTA renegotiations, U.S. Secretary of Agriculture Sonny Perdue said at a joint news conference at the Port of Savannah, Georgia. He declined to elaborate.

“Now is not the time to talk about them. These are family discussions that need to take place,” Perdue said. He compared the 23-year-old trade relationship to a marriage.

Renegotiation of NAFTA was a key campaign promise of U.S. President Donald Trump, who has pledged to shrink goods trade deficits that stood at US$63 billion with Mexico and US$11 billion with Canada last year, according to U.S. Census Bureau data.

While the U.S. has criticized NAFTA’s impact on domestic manufacturing, it has recognized the agreement’s benefits to agriculture.

“We’ve come together to acknowledge that by and large NAFTA has been a favourable agreement for our three (agriculture) sectors in all three countries from an agricultural perspective,” Perdue said. “That is the communication I gave to President Trump.”

Perdue is meeting with Canada’s minister of agriculture, Lawrence MacAulay, and Mexico’s secretary of agriculture, Jose Calzada, in his home state for several days this week to lay groundwork for upcoming NAFTA renegotiation talks.

— Reporting for Reuters by Harriet McLeod in Garden City, Georgia, and Karl Plume in Chicago.

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Perdue was speaking to reporters after he met with Canadian Agriculture Minister Lawrence MacAulay in Toronto.

Canada’s dairy farmers last year struck a new pricing deal, known as Class 7, with processors including Saputo and Parmalat Canada. Foreign industry groups said the deal priced domestic milk ingredients used to make cheese and yogurt below cost.

“I made it very clear that the Class 7 designation we felt was unfair, undercutting this (U.S.) industry that grew up south of the border,” Perdue said. “… The quick win would be to do away with Class 7 milk, which we think is a very unfair, underhanded circumvention of WTO (World Trade Organization).”

Perdue’s comments come as the U.S. has signalled it wants to renegotiate the North American Free Trade Agreement (NAFTA) with Canada and Mexico. They illustrate possible obstacles to a new deal, even as the U.S. and Mexico went into overtime on Monday on sugar trade talks.

In a statement, MacAulay said he and Perdue discussed “shared priorities.”

Perdue said that Class 7, which took effect in February, enabled Canadian farmers to overproduce milk, contributing to depressed world prices. Canada protects its dairy sector from foreign competition with high tariffs on imports above a quota and controls domestic production to support prices.

Canada’s dairy system drew criticism in April from U.S. President Donald Trump, who said he would “stand up for our dairy farmers” against Canada’s “unfair” practices. He did not give details about his concerns.

Dairy Farmers of Canada, an influential lobby group that was closely involved in creating Class 7, could not be reached for comment. In the past, the group has stressed that Class 7 is a domestic policy, and allows Canadian processors to continue choosing their suppliers.

Perdue said he also raised concerns about how U.S. wheat is priced in Canada, and about how U.S. wines are displayed for sale in some provinces.

Under Canadian legislation, U.S. wheat automatically receives the lowest quality designation and price in Canada under the country’s grading system. Perdue said the wheat-grading issue seems to be less of a concern to Canada and its farmers and could be resolved quickly.

Bilateral trade in agriculture and food was worth $62 billion in 2016, according to the Canadian government.

— Rod Nickel is a Reuters correspondent covering the agriculture and mining sectors from Winnipeg.

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