Mr. Murray (Cariboo):

Has the minister given any thought to looking for markets for our agricultural products along the Pacific? We have been shipping to the English market for one hundred years. In 1858 there were considerable shipments of grain from Upper Canada to Great Britain and that has been going on ever since. I would refer the minister to the Turgeon commission on grain which reported prior to world war II that the only part of the world where there was a demand for the surplus grains of Canada was along the Pacific. I just throw that out as a suggestion.

A lot of time has been wasted discussing the various angles of the agricultural situation. Hong Kong is a tributary to Vancouver. For fifty years we have been subsidizing ships that run to Hong Kong, and yet I think the returns will show that the people of Hong Kong before the war were buying bacon brought from Czechoslovakia or some place in Europe. No effort was being made by our Canadian people to develop a market in that British port. There are 80 million people in Japan and that country should provide a market for some of our surplus products.

I recall a contract that was entered into by certain people in Shanghai for the purchase of ice cream to be manufactured in British Columbia. This transaction was upset by the outbreak of war. There is a civilization developing over there which is becoming quite modernized and the people are acquiring a taste for bacon, flour, apples and many other products which we have in Canada.

And cheese.

Agricultural Prices Support Act

Mr. Murray (Cariboo):

Cheese and dairy products. It might be well to think of developing some of these sources of trade when we are finding the markets of Europe so difficult to enter.

Mr. Gardiner:

The Minister of Trade and Commerce is not here at the moment. He would have a much more intimate knowledge of the matter that has been raised than I have. I agree with most of what has been said tonight, that the best market for our Canadian products is in Canada. Right now we are getting higher prices for most of what we do sell in Canada than we could get anywhere else in the world. This applies to practically all animal products except beef cattle.

As long as the farmer can sell all that he produces in Canada, that is where he is going to sell especially when he can get more here than anywhere else. When we think he is not going to get enough, under this legislation we provide him with another three and a half cents per pound for Wiltshire sides and three cents per pound for cheese, partly by way of subsidy and partly by saying to the consumer in Canada that we would like him to pay it. With that help our farmer is getting higher prices than he could get elsewhere.

That is just what we said to him six years ago when this legislation was put on the statute books. We told him that we would help him to get better prices for staple products than he could get anywhere else, and he has been getting them. I suppose it may be argued that he has not been getting them long enough. I do not know, but up to now he is getting it. He is going to sell all he can in that market. In that regard may I say that we were doing a lot of talking a short time ago about the price of hogs. We have eaten 32 per cent more pork in the last two months than we ate in the same two months last year. We have eaten so much that the price of hogs today is just about at the floor price where it was last year when we were selling Wiltshire sides to Great Britain at $36 a hundred. Because our own people are eating bacon at a higher price than it is now being sold to Great Britain we are not getting the bacon to send there at the present time. Just a fraction of what we had expected to send to Great Britain has gone over in the last two months. We are not so much concerned now as we were a little while ago about whether the 60 million pounds in the contract is going to be used up in the first six months. I say that in order to show that when you can sell hogs at the price we are selling them in Canada, when you can sell cheese at the price you are selling it in Canada, when you can sell butter at the price you are selling it in Canada, there is no use thinking about trying to sell them in China

because the Chinese just do not pay that much for the food they eat even if they had the dollars to pay for it.

After you get through with Canada the second best market, provided they will let us into it, is the United States. That is proved by the fact that when I was out in Alberta the other day I warned them about the situation. I might say to my friend from Calgary West-and he is concerned about that country-that one of the reasons why I went out there was to point out to them that they are selling 500,000 head of cattle a year, and Saskatchewan is selling 400,000 head of cattle a year. By doing that for the last few years they have reduced the number of cattle on the farms by two million. If they keep on doing that for a few years longer we will be wondering where we are going to get our production. We will not be wondering what we are going to do to sell it. I was warning them against selling their cattle at that rate and putting in three million acres more wheat last year. I was warning them that they should not do that another year, that they should keep their cattle on the farms, that they should keep on feeding cattle and cut down on their wheat acreage.

I say that in order to point out that there is no way in which you can determine that you are going to sell products to a market that is not as good as the one to which you are selling them. There is no place else in the world where you will get a price for cattle that will cause our farmers to cut down their herds to the extent they are in order to sell cattle in the United States. When they started to do that they did not think they were going to have those prices for cattle long enough to cut down their herds. They thought they were going to get something for what they had carried over and then eventually come to a lower level, but they have not yet.

After we get by the United States, if we have anything left to sell to anyone, apart from the trade restrictions that are put on and the fact that people refuse to buy it, the best market is the British market. If after we get through supplying those three markets we have anything left certainly we start to hunt for other markets, but it is not very often we have much left. We are always prepared to sell our products anywhere in the world that we can sell them and get the same return for them as we can get anywhere else. We have our feelers out in every country in the world where products can be sold in order to get all the information we can. I repeat what I have repeated on a number of occasions-and I hope I will not start a discussion by saying it-that we are not experiencing any great difficulty in selling our surpluses. When I

say "surpluses" I am speaking advisedly and using the word "surplus" in the broadest sense of the term: you produce more than you want to consume in your own country. I am not talking about what is left over at the end of the year. I could go through these figures in front of me to indicate to you that when we get to the end of the year we have not very much of anything left over, if anything.

Except butter.

Mr. Gardiner:

We have not much of that. We eat a million pounds of butter a day. You could eat in ten days in this country all the surplus we have carried over. If it snows until the end of April as it has today you will eat it all. We have not got any more than enough in this country if we go through an April such as we have often had.

Mr. Drew:

It will be bad if we have snow in June.

Mr. Gardiner:

I have seen snow in May and I have gone skating on the 7th of May.

Mr. Knowles:

You go skating every month in the year.

Mr. Gardiner:

My friend says I go skating. I used to do a lot of skating, but I don't any more.

Mr. Knowles:

You skate on pretty thin ice, too.

Mr. Gardiner:

I used to keep some people who are in the house fairly busy too.

Not on thin ice.

Mr. Gardiner:

No; we put the ice some place where it would not break through, but nevertheless we had it. In concluding my remarks on this matter, I want to say that we explore every market in the world for farm products. From time to time we are selling products in Israel, India, Greece, Italy and France. We sell them in every country where we can, and it is not always just because we are worried about surpluses. It is because we want to encourage people to do what some of my friends over here have in mind when they talk about barter. We like to make some of these people feel good by giving them what they want even if we have to run ourselves short sometimes.

Mr. Wright:

Mr. Gardiner:

Mr. Chairman, the board has followed exactly the practice as outlined in what I read this afternoon, and exactly the practice stated in the legislation itself. If my hon. friend did follow what I said at the federation meeting at Niagara Falls, he will recall that I was asked that question there. On the night of the broadcast, when Mr. Galbraith was there from the United States, I was asked by Mr. Hope, who is well known to members of this house, how we arrived at our floor prices. I stated that the practice we had followed had been to set up an agricultural prices support board in 1944. We gave them the task of comparing the costs to the farmers at that time with the returns they were obtaining, that is for 1943, 1944, and 1945, the last three years of the war.

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Then I said that in setting floor prices we went back over those figures and had them checked. Then we compared them with the prices that the farmers were paying for the same list of products now, and what they were getting for their products under the floors. Well, that was the first answer. Then Mr. Hope asked Mr. Galbraith which period would give the farmer the better return if it were taken as a basis for what was called parity, the period of 1943-45, or the period 1926-29, or the period 1909-14, which is the period used by the United States. Mr. Galbraith said he did not have the figures for 1943-45, but he did have the figures for 1943-48, and he said the best period in the United States was that period. He said the second best period was from 1926 to 1929, and the third best was from 1909 to 1914. If I remember correctly, he said that the highest one was about 15 per cent better than the other one. While he did not have the exact figures on the centre period, he thought it might be somewhere around 10 or a little lower, better than the period 1909-14.

The next day I was asked this question again in the open meeting, and I gave the answer that I have just given. Mr. Hope stood up in the meeting-I am sure that if he were here tonight he would tell you what I am going to tell you now-and said, "When I asked the question last night and got the answer I did from Mr. Galbraith, I was a little surprised; so I went right up to my room and took those figures." For the benefit of the members of this house, 1 might say that up until last year Mr. Hope was the economic adviser to the Conservative party on agricultural matters. He is now economic adviser to the farm federation. Mr. Hope said he went up to his room, took the figures which he had, checked up on what had been said, and applied it to Canada. He said, "I must say that the last period is still the better in Canada." He did not say how much better, but he said it was better in Canada. In other words, our base is the highest price.

What I want to say, in reply to the question that has been asked, is that we have checked the floors we have put in. A Mr. Maclnnis, the gentleman who has been going around Ontario making speeches about hogs, got up in the meeting and said, "Can you give me those figures?" I told him I could not give him those figures now because I did not have them with me, I checked them before I agreed to the 321 cents, and before I agreed to the figure that is being paid by all concerned. I said, "All I can tell you at the moment is that the price which was agreed to is highest." Well, I have

sent him the figures since, and speaking from memory-I can give the correct figures later if it is necessary-it works out to 24 cents and a fraction for hogs that are now selling in Toronto at 27 cents and a fraction. You will find if you go over the others that there is not very much difference in the others as compared with that. In other words, we have not written a formula into the act; we are trying to use common sense in working out the figures. We think they are quite satisfactory.

Mr. Wright:

I take it from the minister's reply that the period 1943-45 will be used in determining-or is it 1943-48?

Mr. Gardiner:

The period we have been checking on is 1943, 1944 and 1945. We will continue to check on it. I do not say, neither do they in the United States, that when that has been worked out we are going to pay a 100 per cent floor price based on it. In the United States, they do not pay anything higher than 90 per cent, and most of the time they are paying 60 per cent. What I did say in Niagara Falls, and what I have said everywhere, is that, when we brought in this legislation, no farmer in Canada, no one anywhere, expected that we would set floor prices at the highest price level we would ever obtain for farm products. That is the price we obtained in 1949, the highest price we ever obtained.

The only criticism that has been made of what we have done is that we should have put the floor at the peak. We did not undertake to do that.

Mr. Wright:

It is quite evident from what the minister has stated now that', so far as the government is concerned, it is not going to give a guarantee at all. It is only going to figure out the 1943-45 price and decide on each product as it comes up, whether to set the floor prices at 70 per cent of parity, 90 per cent, or 25 per cent.

Mr. Gardiner:

The people learned a long time ago, and have demonstrated it quite a few times in recent elections, that the security of having a Liberal government in power giving them these undertakings is sufficient.