Four big competitive obstacles stand in the way of food and beverage manufacturers that want to grow their operations in Canada, says Teresa Schoonings, a member of the board of Food and Beverage Canada (F&BC). While the food and beverage makers are the largest manufacturing sector in Canada, they face a growing cost of doing business, problems generating funding for capital expansion, a stultifying regulatory burden and finding enough workers, she told the Senate agriculture committee, which is studying the value-added sector in Canada. The cost of doing business in Canada and competition among food retailers is putting the squeeze on profit margins, she said. That “leaves fewer dollars for companies to reinvest in growing their business. Costs in all areas of business are increasing, and our global competitors are not all experiencing the same rate of increase.” The financial squeeze reduces resources needed for in investment in plants and equipment, she said. At the same, funding programs available to support small and medium sized enterprises often exclude companies in the best position to expand. “This impacts investment decisions, especially with major international brand players who can choose to invest elsewhere, where costs are lower and there are other incentives like the new Trump tax advantage.” Meanwhile regulatory costs and burdens, as well as interprovincial regulatory fragmentation, “are greater in Canada and are getting worse,” she said. “They tend to happen in a piecemeal fashion, so increasing regulatory burdens simply shifts the focus of food manufacturers from investing in innovation and new technology to grow their business to investing and innovating for compliance.” As well, the processors can't find enough employees at all skill levels, she said. “Employers are also facing increasing costs of labour, and education systems are not steering students towards careers in agrifood.” Changes to the Temporary Foreign Workers Program have compounded the shortages. She pointed to Food and Beverage Ontario's Taste Your Future as the kind of program that could be used nationally to make people aware of the careers available in the food sector. There are three steps governments can take to assist the sector become more competitive and help achieve Ottawa's goal of $75 billion in agrifood exports by 2025, she said. First is a more cohesive policy development process. “We need a new approach to how we all work together. With a fact-based, solutions-oriented partnership and open collaboration between industry and the whole of government, we can tackle the challenges in a way that meets the needs of all and enables the industry to grow. Getting The Safe Food for Canadians Act into law is crucial, she said. First announced by former agriculture minister Gerry Ritz in 2011 and passed in Nov. 2012, the law “fits the need to fundamentally change the current process to meet the needs and challenges of today's market and oversee compliance based on modern, risk-based and progressive regulations,” she said. “It would also help to address the growing consumer trend across the world of greater social consciousness, public health, food safety, affordability and environmental sustainability.” For the last five years, CFIA has engaged in round after round of negotiations with the agrifood industry and other groups. The industry is still waiting for a final version of the regulations that are to implement the Safe Food Act. The other badly-needed ingredient is a national food policy. “Today we treat agrifood as an extension of farming where small and local is beautiful, and the shifting preferences of affluent urban consumers are a greater policy and regulatory priority than cost competitiveness,” she said. “We won't achieve the industry's full economic potential and gain public trust if we continue with this approach, nor will we meet our global export target of $75 billion.” Agriculture Canada has been working on the food policy since last year and it's expected to appear this year. Schoonings said her organization formed earlier this year “is committed to working with the provincial and federal governments cohesively and progressively on the enormous social, environmental and economic opportunities embodied in our industry. This could mean major changes in our industry to make it happen, including the consideration of shifting lead responsibility of our industry to Innovation, Science and Economic Development as well as establishing a national food policy with all stakeholders acting as partners to shape the future of the food system.” Alex Binkley is a freelance journalist and writes for domestic and international publications about agriculture, food and transportation issues. He's also the author of two science fiction novels with more in the works.