30 octobre 1998

The newly reconstituted Canadian Sweetener Symposium took place in Toronto on October 22, 1998. John McCallum, Chief Economist of the Royal Bank, set the stage, reflecting an optimistic outlook for recovery from the Asian economic crisis. He supported the general view that Canada's dependence on the commodity sector has had a major bearing on the Canadian dollar, but argued that Canadian fundamentals are still strong and that there is considerable room to lower interest rates if that is necessary to stimulate the economy. While he characterized all forecasts as "fraudulent", he predicted a 0.68 Can dollar by the end of 98 reaching .70 by the end of 99.

Brian Mahony provided an update on the Queensland sugar industry. He noted that sugar cane is the second largest crop after wheat in Australia and that the large volume of exports is not insulated from current world sugar market trends. As a world market importer, Canada's refining industry is a very important customer, importing 600 - 750,000 tonnes of raw sugar annually.

Bill Cromarty, a commodity consultant, emphasized that price forecasts are made in the context of the current structure of the world market. Any "shock" to the system, such as the recent financial crisis, can have a significant impact on the sugar market and sugar prices. He predicted little change in the current low world sugar prices, forecasting an 8 cent/lb raw sugar price for January-June 1999.

Larry Martin from the George Morris Centre in Guelph, Ontario demonstrated how Canada's agri- food sector has improved Canada's trade balance with the U.S. since the FTA. Most of the growth has been in value-added products as distinct from the raw commodity. However, some sectors lag behind (e.g. dairy and poultry) as does overall agri-food trade with markets other than the U.S.. He identified export market access and the removal of subsidies among the key factors influencing the competitiveness of Canada's agri-food sector.

Sugar industry makes case for improved export opportunities at "take note" hearings in Ottawa

Sugar trade was the first subject to be addressed by the Standing Committee on Agriculture and Agri-Food at its "Take Note" Hearings on the upcoming World Trade Organization (WTO) negotiations. The Committee devoted the morning of October 27th in Ottawa to hear from representatives of the Canadian Sugar Institute (CSI) and the Canadian Sugar Beet Producers' Association. The two associations emphasized that the future growth and prosperity of the sugar industry depend on meaningful gains in export market access (primarily the U.S.) and the phase-out of trade distorting sugar policies around the world.

Sandra Marsden, President of the CSI, described how the Canadian industry has evolved and rationalized in response to competitive pressures, especially severely restricted export opportunities and other unfair trade practices. She stressed that the industry had fared worse, not better, under both the NAFTA and WTO trade agreements, and encouraged Committee members to ensure that Canada's trade objectives in the next WTO round address this inequity by seeking:

  • meaningful access to export markets for sugar and sugar-containing products manufactured in Canada
  • balanced tariff reduction (recognizing that Canada already has minimum tariffs for sugar while other countries maintain prohibitive tariffs)
  • to reduce/dismantle domestic support and eliminate export subsidies that distort world sugar trade flows/prices
  • to ensure that both refined beet and cane sugar produced in Canada can benefit from export access gains
  • to eliminate ineffective or restrictive border practices that undermine Canada's access to quotas

Mark Kuryvial, President of the Canadian Sugar Beet Producers' Association described the dramatic increase in productivity that the sugar beet producers in southern Alberta have made. Together with the $40 million upgrade and expansion taking place at the Taber Alberta sugar beet processing facility, Canada's beet sugar industry is internationally competitive. He indicated that production there could be almost doubled from current levels if existing trade barriers were removed.

At the conclusion of the session, Committee members recommended that the sugar industry be properly consulted in these negotiations, recognizing the significant negative impact that previous trade negotiations have had on the industry.