May 28, 1931

CON
LIB

Peter John Veniot

Liberal

Mr. VENIOT:

The total exports in 1929

amounted to 1,889,200 pounds to the following countries: Great Britain, nothing; Newfoundland, Bermuda, Bahamas, British West Indies, British Honduras, British Guiana. The exports to British Guiana and the British West Indies were increasing. Now let me take the production of butter in Canada. The New Zealand treaty came into force late in the fall of 1925. In 1927 we imported from New Zealand or other countries 11,208,809 pounds, according to the hon. member for Stanstead. In that year we produced 143,000,000 pounds. In 1928 we imported nearly 17,000,000 pounds. Notwithstanding that increase in our butter imports we produced

168.000. 000 pounds in round figures, whereas the production in 1927 was 143,000,000. In 1929, notwithstanding the New Zealand treaty, and notwithstanding according to the hon. member for Stanstead, that we imported

35.000. 000 in round figures from New Zealand, Australia, and other countries, we increased our production from 168,000,000 to 172,581,406 pounds, but our consumption was 230,000,000 pounds. In spite of the fact that we were increasing our production year by year we had to import 35,000,000 pounds in 1929 from Australia, we did not have enough butter to meet the demands of the Canadian people. Butter had to come from some place, and as far as the production of butter in the province of Quebec is concerned, it increased in 1928 by a small fraction. Notwithstanding the large quantity of milk and cream they were selling across the border to the states of Vermont and New Hampshire, the butter production increased. Let us go back to 1912, 1913 and 1914 and see what we find. In those three years the production of butter in Canada was so far from meeting the demands of the Canadian people that we im-

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ported almost as muc'h butter as we imported in 1928, during which year the importation amounted to nearly 17,000,000 pounds.

If the hon. gentleman had wished to be fair in his argument and in his comparisons he would have told this committee why we had to import this butter. We imported it because the Canadian people were not producing sufficient butter for their own consumption. It may be said, as it was said during the election campaign, that the farmers were not given sufficient protection, and for that reason they were not going into the dairy business. The hon. gentleman, however, in giving the figures having to do with the production of dairy products in this country, forgot to tell the committee of the enormous strides made in the last six or seven years in the dairy industry in addition to the production of butter and cheese. There has been a tremendous increase in the production of solidified cream, if I may use that term, and ice cream. There is a large butter factory in the province of New Brunswick situated within ten miles of one of the best dairying districts in the Dominion of Canada, but the farmers refused to sell their cream to that factory at from 38 to 42 cents. They can make a greater profit by sending their cream to the ice cream manufacturers. I know this to be the fact, because in 1923 when I had the honour of being premier of New Brunswick, the factory at Moncton, which is subsidized to a certain extent by the provincial government, requested the government of that province to guarantee a credit of 850,000 with the Bank of Montreal, to be used as working capital. The reason they asked that guarantee was in order to enable them to hold over the butter they had in storage on August 15, so they might get a better price later in the winter. I looked into the matter, because I wanted to satisfy my-.self that the business was being run properly before arranging for the guarantee of the province, and I discovered that the dairymen of the Salisbury and Petitcodiac districts were refusing to sell their cream to the factory because they were getting a better price from the manufacturers of ice cream. Under those conditions I refused to allow the guarantee of the province to be given; a credit was arranged for, but only to the extent of 835,000. I found later on, when the people could not buy butter, that there were 110,000 pounds in cold storage. The following year I refused the guarantee of the province to anyone who would keep butter in cold storage for that

period of time in order to get an increased price and make the consumer pay too much for it.

These are conditions which have not been heard of, perhaps, or at least which have not been mentioned in this house. These are the conditions which existed in the dairy industry of the province of New Brunswick, and the lessened production is not the fault of this or any other government. If the dairy farmer could get a greater price for his cream by selling it to the manufacturers of ice cream, he did so. He was not to blame for that; he had a right to place his cream where he would get the better price for it.

Never before has butter been selling at the low price which is being paid to-day, and that is why I asked the minister this afternoon why he consented to let Australian butter loose on the markets of Canada, which came into this country under an agreement that it would not sell for less than 32 cents per pound. The answer given by the minister was that they had shown their good faith by keeping the first agreement; that they had a large quantity of butter in Canada, and he felt it nothing but fair that he should let them dispose of it. He did so; he let them dispose of butter which came into this country to be sold for not less than 32 cents per pound, at a time when the farmers and dairymen of Canada could not get more than 21 cents per pound for their butter, which seems to me very poor judgment indeed.

I just wanted to place these statistics before the committee. As far as I am concerned, I think the item of $5,000 now before the committee for the National Dairy Council of Canada should not pass. The council should not have that money to spend, because I am convinced that the council cannot be said to be entirely clear of politics, and its political shade certainly blends with that of hon. gentlemen apposite.

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John Yeo

Mr. BO YES:

The hon. member who has just taken his seat made reference to the National Dairy Council. I wish to make just a few remarks in defence of that council. I was present at the time the National Dairy Council was inaugurated, in the city of Ottawa, some few years ago. The idea of inaugurating this council had nothing to do with politics at all, and I feel sure that they have never taken any action for political reasons. I should like to prove this statement by referring to the manner in which the national dairy council is at present

. * . Suppl y-Agriculture-Dairying

organized. It is composed of members from one end of the Dominion to the other. The following is a list of the membership:-

Head Office:

Journal Building, 233-237 Queen Street Ottawa, Canada President:

F. E. M. Robinson,

Vice-Pres., Richmond Jerseys Inc. . Richmond, Que.

Vice-President:

E. T. Love,

Woodland Dairy Edmonton, Alta.

Secretary and Treasurer:

W. F. Stephen,

Ottawa, Ontario Telephone, Queen 6147

Members of the Council, 1931 British Columbia

British Columbia Dairymen's Association:

R. V. Hurford, Comox Creamery Co., Courtenay.

*J. W. Berry, M.L.A., Langley Prairie. Representing Producers:

A. E. Dumvill, Sardis.

Alberta

Alberta Dairymen's Association:

*E. T. Love, Woodland Dairy, Edmonton. Norman E. Clarke, Didsbury.

'Western Ice Cream Manufacturers:

J. W. Carlyle, United Dairies, Calgary. Western Producers:

J. R. Love, 10531 102nd street, Edmonton. Saskatchewan

Saskatchewan Dairy Association:

Robert Barbour, Crescent Creamery Co., Ltd., Yorkton.

*P. C. Colquhoun, Maple Creek.

Western Butter Manufacturers:

O. W. Andreasen, Saskatchewan Co-operative Creameries, Regina.

Manitoba

Manitoba Dairy Association:

*J. P. Donald. Palm Dairies Ltd., Winnipeg. G. W. Tovell, Winnipeg Milk Producers' Association. McIntyre Block, Winnipeg. Western Milk Distributors:

J. W. Speirs, Crescent Creamery Co., Winnipeg.

Ontario

Dairymen's Association of Western Ontario: A. E. Grace.v, City Dairy, Ltd., Simcoe. Eastern Ontario Dairymen's Association:

J. N. Truelove, Westport, Ont.

Canadian Creamery Association:

R. T. Stillman, Brant Creameries, Ltd., Brantford.

Ontario Milk Distributors' Association:

*W. H. Forster, Pure Milk Co. Ltd., Hamilton.

The Ontario Milk Producers' Association:

*J. P. Griffin, secretary, Ontario Milk Producers' Association, 21 King Street East, Toronto.

Canadian Association of Ice Cream Mfgrs:

Burness Whitmore, Wellington Produce Co., Harriston.

Condensed Milk and Powdered Milk Interests: G. B. Levis, Canadian Milk Products, Ltd., 115 George Street, Toronto.

Quebec

Quebec Dairy Association:

Alexander Dion, Department of Agriculture, Quebec.

J. H. Crepeau, St. Camille de Wolfe. Montreal Milk Producers' Association:

David Black, Lachute.

Montreal Milk Distributors:

*J. J. Joubert, J. J. Joubert Co., Ltd., Montreal.

C. B. Price, Elmhurst Dairy, Ltd., Montreal. Canadian Produce Merchants' Association:

E. H. Hodgson, 745-771 William Street, Montreal.

New Brunswick

New Brunswick Dairymen United:

W. H. Huggard, Norton.

Nova Scotia

Nova Scotia Dairymens' Association:

*A. Hector Cutten. Truro.

W. R. Kinsman, Yarmouth Creamery Co., Dayton.

Prince Edward Island Prince Edward Island Dairy Association:

W. J. Gibson, Marshfield.

Dairy Cattle Breeders Holstein-Friesian Association:

A. E. Plant, R.R. No. 2, Brantford, Ont. Canadian Ayrshire Breeders' Association: Gilbert McMillan, Huntingdon, R.R. 2. Canadian Jersey Cattle Club:

*F. E. M. Robinson, Richmond, Que.

I feel sure that when hon. members look into this matter they will realize that the members of this council were not elected for any political purpose. I can assure hon. gentlemen opposite that these men are acting in the interests of the dairymen of this country. They were not acting in a political manner when they went up against the late government. They felt sure that the government of that time was proceeding in a manner detrimental to the dairy interests, and I feel sure that they would come up against this government if it attempted to do the same thing or anything similar.

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LIB
?

John Yeo

Mr. BO YES:

I do not think there is any doubt about what they asked for.

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LIB
?

An hon. MEMBER:

They did not get

what they asked for.

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LIB

William Richard Motherwell

Liberal

Mr. MOTHERWELL:

They asked for

four cents and they got eight cents.

*Members of Executive.

Supply-A griculture-Dairying

* Mr. BO YES: The National Dairy Council is not a political organization but is acting in the interests of the dairymen of Canada, and I think those in opposition should support this vote.

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LIB

James Lorimer Ilsley

Liberal

Mr. ILSLEY:

Mr. Chairman, I am disposed to agree with the last speaker, that we should support the vote. So far as I know the National Dairy Council is not primarily a political organization. Last year I gave some attention to and made some study of the proposal which they made to the tariff advisory board and later to the government, and I thought their request for a four cent duty was a perfectly reasonable one. However, the present government has gone much farther than that and has imposed an eight cent duty. Before I conclude my remarks I intend to ask the Minister of Agriculture to give the committee his frank opinion as to whether he thinks it possible that the imposition of an eight cent duty can do the dairying industry any good for years to come. My opinion is that it is not reasonably possible.

I was much impressed with the remarks of the hon. member for Red Deer, and I agree with him when he says that when Canada is on an export basis in regard to butter it is not possible for a protective duty to do the dairying industry any good. It is possible that under a different system of organization some good might be done, if, for instance, the government could control the entire output, as the hon. member for Red Deer says; but so long as there are hundreds of thousands of producers of butter producing and marketing their product on a competitive basis they cannot possibly be benefited by the imposition of a duty because they are bound to take the export price, as is the case at the present time.

I tried ineffectually a few times to get the floor after the hon. member for Stanstead made his somewhat impressive speech. The hon. member presented figures to the committee showing that the Dominion of Canada had between 1925 and 1930 gradually changed from an export to an import basis on butter, and the inference the committee was expected to draw from the figures-the hon. member will correct me if I am wrong-was that the fiscal policy of the preceding administration was the cause of that trend. Our effective competitor during those years was New Zealand and the duty imposed against butter coming from that country was one cent per pound. Although the hon. gentleman did not put it in so many words, he intimated that because of this low duty we had gradually drifted between the years 1925 and 1930 from being on a heavy exporting basis to an im-

porting basis. That is the inference he expected the committee to draw from the figures he placed on Hansard. There never was a more glaring non sequitur. The effective causes which brought this change between 1925 and 1930 were not duties; it was brought about by entirely different factors. The main factor, of course, was the fact that the wheat growers of the west were prospering at wheat growing. As the hon. member for Red Deer pointed out, and as we all know, whatever part of Canada we live in, men prefer to grow wheat to milking cows if they can make as much out of wheat. Certainly they will grow wheat if they are making more at it than they could make by milking cows. So men by the thousands went out of dairying into wheat growing exclusively. That was not attributable to the fiscal policy of any administration, and it was the greatest single factor in preventing a growth in the production of daily products in Canada.

There were other factors as well. There was the great increase in the tourist traffic into this country from the United States. The United States was enjoying a period of piping prosperity. The tourists came across the border in great numbers and -consumed milk products, perhaps largely ice cream, in great quantities. I think I saw somewhere that the tourist consumption of milk and milk products amounted to about 15,000,000 pounds per annum if converted into butter.

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An hon. MEMBER:

In Quebec it was beer.

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LIB

James Lorimer Ilsley

Liberal

Mr. ILSLEY:

They may have come for other purposes as well, but the consumption of milk products was incidental to the purposes for which they -came. That was another factor in driving us from -an export to an import basis. There were other factors as well. At one time during the period beef went to a high level and cattle that were on the border line, that might be used for dairying or for beef purposes, were used for beef. We all know that. There were still other factors, though I cannot call them to mind at the moment.

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LIB
LIB

James Lorimer Ilsley

Liberal

Mr. ILSLEY:

Yes. This country was in a very prosperous condition and there was -a great increase in consumption. There came a period during the latter part of those five years when we went on an import basis and a protective duty became effective in transferring money from the consumers to the producers of dairy products. That period was relatively brief. The National Dairy Council, the vote for which is under discussion, said it would be advisable, under all the circum-

20S5

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stances, for the government to raise the duty against our effective competitor from one cent to four cents a pound, and the government did so. The present government, not content with that, not willing to take the benefit of the long experience of the very able men who were in control of the National Dairy Council, particularly Mr. Robinson, the chairman-as I should say from reading his addresses- doubled the duty and made it eight cents a pound. But never were the benefits of a duty as short-lived; they lasted only two or three months, and now they have all disappeared. Does anybody deny that they have all disappeared? Of course they have. We are back on an export basis, and the very size of the duty helped to drive us back on to an export basis more quickly than otherwise would have been the case. We are back on an export basis now just as the officials of the National Dairy Council feared we would be if too high a duty were imposed, and crash have gone the prices. As hon. gentlemen on both sides of the house must admit, prices are away down, lower than they have been for a quarter of a century.

In conclusion, I should like to ask the minister whether he does not agree with the main facts that I have tried to set out. I want to treat the matter very fairly; I am not fanatical in regard to it. I do not advocate free trade under all conditions and all circumstances, but I say that the government should have been content to stand by the four-cent duty advocated by the National Dairy Council. The eight-cent duty has done more harm than good. I want to put this to the minister: Does he not think we are going to be on an export basis for many years to come? Does he not agree that wdren we are on an export basis, a duty does not help the producer? Does he think his government's edght-cent duty is going to be any real good to the producers for many years to come?

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CON

Robert Weir (Minister of Agriculture)

Conservative (1867-1942)

Mr. WEIR (Melfort):

I felt at the time

the duty of eight cents was imposed-and I feel the same way now-it was advisable to impose it. The farmers of this country had so few farm products to sell that would bring in any money and there was such a quantity of butter in storage in Canada, that the higher the protection we could give them, the better, on account of the urgent condition of the farmers at that time.

There is one point in these figures that I would like to have cleared up. I understand the hon. member for Hants-Kings, who has just sat down, stated that during the first four or five months of 1930 the average price of butter in Montreal or in Canada was higher

than the average price of butter in New York.

I should like to know where the hon. member got that information, as one thing w'e have to do in our department is to obtain the most accurate information possible.

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LIB

James Lorimer Ilsley

Liberal

Mr. ILSLEY:

I cannot give that information at the moment. I think what I stated was that I had been so informed. I put my assertion in the form of a question to the hon. member for Stanstead and he thought I was incorrect. I am quite sure I am right, but I shall get the figures between now and tomorrow afternoon.

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CON

Thomas Alfred Thompson

Conservative (1867-1942)

Mr. THOMPSON (Lanark):

The ex-Postmaster General, in concluding his speech, intimated that the National Dairy Council was a partisan organization and therefore he was opposed to voting them this $5,000. I should like to ask the hon. gentleman why the government of which he was a member for years voted the National Dairy Council this $5,000. I was at the organization meeting of the National Dairy Council, and for many years I represented eastern Ontario on it. It has always been at least three-quarters Grit in its composition. The Liberals on it always outweighed the Conservatives by a large number, and to-day the same situation prevails Further, when we had a delegation to interview the late Mr. Robb to remonstrate with him against making this treaty with Australia and allowing New Zealand butter to come in free, the great trouble was to accomplish anything without hurting the administration of that day. I want to say further, as I said this afternoon, that while the National Dairy Council has been composed of more Liberals than Conservatives, they have been men who have had the interests of the dairy industry at heart and have rendered Canada splendid service, and this item should pass.

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CON

James J. Donnelly

Conservative (1867-1942)

Mr. DONNELLY:

There has been some discussion about the price of butter in New York and Montreal during the early months of 1930. I understood the hon. member for Stanstead to say that the price of buttter in New York was higher in the early months of 1930 than it was in Montreal.

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Edward Hackett

Mr. HAOKETT:

I made no reference to New York.

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CON

James J. Donnelly

Conservative (1867-1942)

Mr. DONNELLY:

I have figures here

supplied by the Dominion Bureau of Statistics, giving the average monthly wholesale prices of butter in New York, Montreal and London for the year 1930. In January, butter was 41 cents in Montreal and 36.1 in New York; February, 39 cents in Montreal and 35.5 in New York; March, 37.3 in Montreal and 37.1 in New Ylork. Each of

Supply-Agriculture-Dairying

those months butter was higher in Montreal than it was in New York. But, Mr. Chairman, I do not think it is a fair comparison to take prices in Montreal and New York because New York supplies a large consuming population in the New England states, and the price fluctuates from time to time. The only fair comparison to make is between Montreal and London, which is the world's market, and if we compare our prices with London prices from time to time, we shall get a more accurate picture of what effect the tariff has had on our prices and what it has done to our market for butter.

I take the same months of the same year. In January, 1930, the price in Montreal was 41, and in London 38. In other words, our price was 3 cents higher. In February, the price was 39 in Montreal and 37.5 in London, a difference in our favour of 1.5 cents. In March, the price in Montreal was 37.3 and in London 35.1, a difference in our favour of 2.2 cents.

The minister takes a great deal of credit because this government put a duty on butter when they came into power. At page 2001 of Hansard he says that when the present government came into power the price in Canada was 28 to 28.25 cents, whereas the price in London was 28.64 to 29.08. I have here the July prices from the bureau of statistics, and they show that in the month of July the average price in Canada was

30.5 and in London 31.9, or 1.4 higher in London than in Canada. In August the Montreal price was 31.4, and London 32, or a difference of .6 in favour of London. The minister goes on to say in that same debate that they did away with the New Zealand treaty and the price of butter immediately shot up, thus making $2,000,000 for the farmers of Canada by keeping up the price of butter. Let us look at the prices as they were for the rest of the year. In August the Montreal price was 31.4, and London 32; September, 33.4, Montreal, and 31.9 London, or 1.5 higher in Montreal; October, 33.2 Montreal, and 32.3 London, or .9 higher in Canada; November, 33 Montreal, London 29.8, or 2.2 higher in Canada; December, 33.2 Montreal, and London 29.5. It is the same all down the list, showing a higher price in Canada for all the months varying from

1.5 to 1.9, 2.2, 2.7, 3.2, 4.5, and 5.5. Those are the differences in prices up to the end of April, showing a higher price in favour of Canadian butter in Montreal. The minister takes credit for all this because the government did away with the New Zealand treat}7.

But let us take another year when the New Zealand treaty was in full effect. I go back

TMr. Donnelly.]

to 1929, when we were bringing in great quantities of New Zealand butter. In January, 1929, the average difference in our price at Montreal as compared with London was 2.8 in our favour; in February we were 5.56 cents higher than the London price, and the New Zealand treaty was then in full force. In April the difference in favour of Montreal was 13 cents part of the time, and in March the difference was 8.51 in favour of Montreal. I say that that is the fair comparison to make, between London and Montreal, and the figures I have given show that there was a difference in favour of the Montreal price in 1929 when the New Zealand treaty was in full force of as much as 13 cents, and there never has been as great a difference since. That might have been the case this year, too, if the New Zealand treaty had not been done away with.

The crux of the situation is this. During the last election the Conservative party went up and down this country saying that they were going to increase the price of butter, and they have not done it. In every constituency in western Canada-I guarantee that it was done in the minister's own constituency, although he may not have made the statement himself, but his supporters campaigning for him did

the farmers were told that the price of butter was going to go up if this government came into power, and the farmers believed that. When you told the farmers that the price of butter would go up if this government was returned to power, they believed it. You cannot fool them by saying that you never said such a thing, because the farmers believed in their hearts that if this government came into power the price of butter was going to go up. But to-day the price of butter is lower than it has been in the last thirty-five years. It has never been so low as it is to-day since the time of the old Tory government in 1896. If the minister goes back to 1896, he will find that butter was then as low as it is to-day under a Tory government, but never under a Liberal government.

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CON

May 28, 1931