Voluntary Report - public distribution

**Date:** 10/8/2004

**GAIN Report Number:** CA4070

CA4070

**Canada**

**Agricultural Situation**

**This Week in Canadian Agriculture, Issue 34**

**2004**

**Approved by:**

![](media/image1.wmf)Gary Groves

U.S. Embassy

**Prepared by:**

Christina Patterson and George Myles

**Report Highlights:**

Throne Speech Says Canada Will Push for More Reliable Access to U.S.
Lumber and Cattle Markets \* Alberta Pork Plant Expands \* U.S. Fish and
Seafood Exports to Canada on a Record Pace \* Ontario Restaurants
Required to Pre-Freeze Raw Fish and Seafood \* Economic Forecast for
Manitoba Downgraded Due to Poor Weather \* Statistics Canada Releases
the September Crop Estimates

Includes PSD Changes: No

Includes Trade Matrix: No

Unscheduled Report

Ottawa \[CA1\]

\[CA\]

This Week in Canadian Agriculture is a weekly review of Canadian
agricultural industry developments of interest to the U.S. agricultural
community. The issues summarized in this report cover a wide range of
subject matter obtained from Canadian press reports, government press
releases, and host country agricultural officials and representatives.

*Disclaimer*: Any press report summaries in this report are included to
bring U.S. readership closer to the pulse of Canadian developments in
agriculture. In no way do the views and opinions of these sources
reflect USDA's, the U.S. Embassy's, or any other U.S. Government
agency's point of view or official policy.

**THRONE SPEECH SAYS CANADA WILL PUSH FOR MORE RELIABLE ACCESS TO U.S.
MARKETS:** Canada's Governor General opened the 38^th^ Parliament of
Canada on October 5, 2004. The Liberals won only 135 of the 308 seats in
Parliament in the June 28 election, meaning they have a minority
government and will have to depend on the Conservatives (with 99 seats),
New Democrats (with 19 seats) or Bloc Québécois (with 54 seats) to pass
legislation. The speech from the throne sets out the broad goals of the
government and how it intends to accomplish them. The throne speech text
included the following statements concerning trade:

> *"Canada has always been a trading nation, but never more so than
> today. It is therefore vital that we secure and enhance our access to
> markets, both in North America and the world. To this end, the
> Government will continue to push for an open, rules-based
> international trading system and a successful conclusion of the Doha
> Round of global trade negotiations.\
> \
> Issues such as softwood lumber and BSE underline the importance the
> Government attaches to obtaining more reliable access to U.S. markets.
> It will build on the successful Smart Borders initiative and on
> measures designed to develop a more sophisticated and informed
> relationship involving business and government officials in the United
> States.\
> \
> The Government will enhance its capacity to expand international trade
> and commerce, with a particular focus on North America and emerging
> markets."*

**OLYMEL TO EXPAND PORK PLANT IN ALBERTA:** Olymel, one of Canada's
largest processors of pork and poultry will reportedly expand its Red
Deer Alberta pork production facility (formerly Fletcher's). The plant
currently slaughters about 45,000 hogs per week. The expansion is
expected to cost up to C\$15 million and nearly double slaughter
capacity. No date of completion is available. Olymel sells almost half
of its pork products in the export market. The Red Deer plant exports
primarily to the U.S., Japan, Mexico, and Australia.

**U.S. FISH AND SEAFOOD EXPORTS TO CANADA ON A RECORD PACE IN 2004:** In
the first seven months of 2004, U.S. fish and seafood exports to Canada
were up 14% from the same period a year earlier and are on a pace to
reach close to \$700 million for 2004. Canada is the second most
important market for exports of U.S. seafood, after Japan. In 2003, U.S.
fish and seafood exports to Canada totaled a record \$612 million, a 6.3
% increase from 2002. The U.S. share of the Canadian import market for
fish and seafood remains steady at 44%. U.S. fishery product sales to
Canada accounted for 20% of the \$3.0 billion in total U.S. fish and
seafood exports to the world during 2003. What are the hottest U.S. fish
and seafood items in the Canadian market? See the Fishery Products
Annual Report CA4071 that will be available shortly on the FAS webpage.

## ONTARIO RESTAURANTS REQUIRED TO PRE-FREEZE RAW FISH AND SEAFOOD: Some sushi lovers in Ontario might want to say *sayonara* to their favorite dishes now that the province of Ontario has passed a regulation effective September 1, 2004 requiring commercial food establishments that prepare fish that is intended to be consumed raw, (including raw-marinated and partially cooked fish), to freeze the product before preparation to a temperature of minus 20 degrees Celsius or below for 7 days or to a temperature of minus 35 Celsius degrees or below for 15 hours.  Many chefs and seafood diners in Canada's most populace province claim that the flavor and texture of sushi dishes will be adversely affected. The province reportedly took the move in a pre-emptive strike against fish borne parasites and other food borne pathogens under its Health Protection and Promotion Act, Regulation 562. At the federal level, Health Canada has related guidelines, and is in the process of developing a comprehensive policy on Raw Foods of Animal Origin that includes meat, poultry, eggs, raw milk cheese, fish and seafood.

**POOR WEATHER RESULTS IN DOWNGRADE IN MANITOBA'S ECONOMIC FORECAST**:
The calendar may read October 8, 2004, but it feels more like June 1^st^
in Manitoba. The sun is shining and temperatures are what you would
expect in the early summer months. In fact this is the kind of weather
farmers in Manitoba were hoping for in June, when the weather was more
like October weather, cold and rainy. Unfortunately for producers in
that province, the weather did not really improve at all through the
summer and the expectations of a good harvest are fading away like the
summer sun. The poor weather slashed yields, produced low-quality crops
and resulted in many fields not worth harvesting. In fact the Manitoba
corn crop has essentially been written off. Between a third to a half of
Manitoba's wheat crop normally comes off the fields as No.1 wheat, but
this year only 10 to 15 per cent will earn that ranking, with the rest
most likely going No. 2 or No. 3 grade. Roughly half the flax crop has
been lost and the quality in the soybeans and canola is down. All this
played a major factor in the Royal Bank of Canada's decision to
downgrade the province's economic forecast from 4.1 per cent growth in
2004 to 3.1 per cent. Agriculture accounts for 4.7 per cent of
Manitoba's gross domestic product and 1/5 of the province's foreign
commodity exports.

**CROP UPDATE**: The growing season is officially over in Manitoba and
Saskatchewan. A killing frost hit the provinces late last week and early
this week, ending what had been a very frustrating year for producers.
On the bright side, both provinces have been experiencing warmer than
normal temperatures with minimal rain, which have helped in completing
harvest. In Saskatchewan, 51 per cent of the 2004 crop has been
harvested. This is still behind the five year average of 86 per cent,
but up from last week's 30 per cent. Combining of canola is just 41%
complete, but most fields have been cut. Crop quality is expected to be
below average overall. In Manitoba, harvest is roughly 50% complete.
Yields in the west were reduced by frost, but other regions are
reporting average yields or above.

**STATS CANADA RELEASES ITS SEPTEMBER ESTIMATES**: In its latest report
of production of principal crops, Stats Canada is forecasting total
wheat production to reach 22.5 million metric tons (MMT) in the Prairies
and a total of 24.5 MMT across the country. The winter wheat production
on Ontario declined 27.9 per cent from 2003. Spring wheat in Western
Canada is forecast to increase 5% to 16.9 MMT as result of an increase
in yield. Durum production is also expected to increase 9% to 4.7 MMT.
All three prairies provinces are forecast to have increased barley
production. The 10-year average is 11.3 MMT and the estimated production
is pegged at 12.1 MMT. Canola production is expected to rise to 6.9 MMT,
which is less than was originally forecast but higher than the 10-year
average of 6.4 MMT. Frost in Manitoba and Saskatchewan resulted in
decline in their production levels. Corn in Ontario and Quebec suffered
as a result of the weather and the result was a 9% drop in production in
Quebec and a 13% drop in production in Ontario.

# Find FAS on the World Wide Web: 

Visit our headquarters' home page at
[http://www.fas.usda.gov](http://www.fas.usda.gov/) for a complete
listing of FAS' worldwide agricultural reporting.

# Recent Reports from FAS/Ottawa: 

+----------------+---------------------------------------+------------+
| Report Number  | Title of Report                       | Date       |
+----------------+---------------------------------------+------------+
| ## CA4070      | This Week in Canadian Agriculture,    | 10/01/2004 |
|                | Issue 34                              |            |
+----------------+---------------------------------------+------------+
| ## CA4069      | This Week in Canadian Agriculture,    | 9/24/2004  |
|                | Issue 33                              |            |
+----------------+---------------------------------------+------------+
| ## CA4067      | This Week in Canadian Agriculture,    | 9/17/2004  |
|                | Issue 32                              |            |
+----------------+---------------------------------------+------------+
| ## CA4065      | Deciduous Fruit Annual                | 9/13/2004  |
+----------------+---------------------------------------+------------+
| ## CA4064      | This Week in Canadian Agriculture,    | 9/10/2004  |
|                | Issue 31                              |            |
+----------------+---------------------------------------+------------+
| ## CA4063      | Livestock Annual                      | 9/1/2004   |
+----------------+---------------------------------------+------------+
| ## CA4062      | Canada Connect Matchmaker Program     | 9/1/2004   |
+----------------+---------------------------------------+------------+
| ## CA4061      | This Week in Canadian Agriculture,    | 9/3/2004   |
|                | Issue 30                              |            |
+----------------+---------------------------------------+------------+
| ## CA4063      | Livestock Annual                      | 9/1/2004   |
+----------------+---------------------------------------+------------+
| ## CA4062      | Canada Connect Matchmaker Program     | 9/1/2004   |
+----------------+---------------------------------------+------------+

VISIT OUR WEBSITE: The FAS/Ottawa website is now accessible through the
U.S. Embassy homepage. To view the website, log onto
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on Embassy Ottawa offices, then Foreign Agricultural Service. The
FAS/Ottawa office can be reached via e-mail at: <agottawa@usda.gov>