April 11, 1935 (17th Parliament, 6th Session)

LIB

Peter John Veniot

Liberal

Mr. VENIOT:

I wish to take up a little time of the committee in dealing with the marketing act so far as it applies to the eastern marketing board for potatoes. I wish to submit a certain number of questions to the minister and in doing so I point out to him what I and others in the maritime provinces regard as an injustice to growers of potatoes at least in New Brunswick, and I think the same situation applies to the other two maritime provinces. For instance I find in the price list issued by the board, prices fixed for export, Halifax. $1.50 per barrel, and 65 cents per bag of 90 pounds. But there is no price fixed for export from the port of Saint John. I should like to know why an export price is fixed only from the port of Halifax. 1 do not expect the minister to be able to give me an answer to-night to the various questions that I am going to submit; ha will find them in Hansard to-morrow and I would ask that he look carefully into them and the objections I am going to place on Hansard in regard to this organization, the eastern potato marketing scheme. Having stated this export price at Halifax and pointed out that no price is fixed at Saint John, I want to know if this means that potatoes for export can be shipped only through the port of Halifax. Then in the instructions issued I find that car lot shipments within Canada must have a government inspector's certificate attached to the car. I have no objection to that, but I also find the following in the instructions:
The buyer shall be entitled to inspection at destination, and this privilege shall be so marked on the bill of lading.
The inspection at point of shipment is made by government officials. I understand a fee of S3 is charged for that. I have no objection to a second inspection at point of destination provided that inspection is made by a government official. But as I understand the working of the scheme, that inspection of potatoes from New Brunswick at Montreal, for instance, is made by the purchaser, not by a government official. Now what will happen and what is happening if that is the case? If the purchaser is allowed to disregard the government inspection at
[Mr. R. Weird
point of shipment and base his price in Montreal on his own inspection, it becomes a monopoly for the dealer. He can turn down the potatoes. It is provided under the law that he shall have that- right of inspection, and if he is so minded, if he. is not one of the most honest men in the world, he can say: "I had these potatoes inspected;
they do not come up to the mark, therefore I will not pay the price agreed upon," which is a price fixed' by the marketing board as a minimum price on the rails at Montreal. I am taking Montreal as an example. I want to know, and our shippers in New Brunswick want to know, why this second inspection is allowed without strict government supervision.
Then in the fixing of prices I find that the price is fixed only as at point of destination. If it is reasonable and right to fix the minimum price at point of destination, say Montreal or Toronto, why is it not right to fix a minimum price for the grower? Today the price is fixed at Montreal, I think at 55 cents or thereabouts for a bag of 90 pounds. Added to that must be the freight and the inspection fee, and the fee, I think it is called1, that is collected by the board to meet certain expenses. Then the price fixed, with these additions, plus the wholesale dealer's profit, is the price to the retail trade.
Since I am dealing with the retail trade at points of destination, how is it that the local marketing board so-called in Toronto can fix a minimum price to the retail trade? What right have they to fix such minimum price? We talk of ethics in business; we have had investigations before the price spreads commission of unethical methods of dealing with sales and purchases. How is it that the local board1-I have it here under date of March 17-can fix a price at Toronto for No. 1 potatoes of 83 cents per 90-pound bag for retail for Ontario potatoes and on potatoes from Prince Edward Island and New Brunswick at $1.09 a bag for the same weight? Then this board has entered into an agreement with certain chain stores that they shall keep the retail price of Ontario potatoes at such a figure as to debar the sale of potatoes from the east. If this can go on under this marketing scheme it is readily seen how injurious will be the effect upon the potato growers of eastern Canada. If Ontario as a whole cannot supply the demand in the Toronto market they have to import, but until the Ontario crop is disposed of this semi-monopoly is maintained, detrimental to the interests of potato growers in the east.

Supply-Agriculture-Marketing Act
Let me draw the attention, of the minister to some other points which I consider should be clarified in the instructions issued. Under the scheme1-
"Dealer" means a person who sells potatoes for resale or negotiates sales of potatoes for resale except persons selling potatoes only of their own production, within the province where produced.
Under that definition a grower may sell potatoes of his own growth within the province where produced. (But in the definition of "marketing" there seems to be a contradiction, because-
"Marketing" includes buying and selling, shipping for sale or storage and offering for sale.
There is no exception of the grower such as is found in the definition of "dealer." That causes a great deal of uneasiness among growers and shippers in New Brunswick, especially in districts where farmers do not devote as much time and attention to the production of potatoes as they do in some of the larger sections of the province, but yet depend a great deal upon the potato market for their living. We find in the instructions issued by the central board, I think it is called, that sales of potatoes for delivery in Montreal, Quebec City and Ontario cities shall be made only to dealers as defined by the eastern Canada potato marketing scheme. This does not apply to potatoes shipped to the prairie provinces and British Columbia.
While I am on that point let me direct the attention of the minister to the fact that there are two grades of potatoes and, according to the instructions issued by the central board, each grade contains four or five different classifications. Under grade 1 there are four classifications, I think, for potatoes to be sold in the province of Ontario and the provinces east of Ontario, which would include Quebec and the maritime provinces. Under grade 2 you find potatoes graded for export, and this is different from the grade for sale in the provinces I have mentioned. That same grade for export, however, applies to potatoes from the east sold in the prairie provinces and British Columbia, and down there we want to know the reason for this difference. We claim that the grade for sale in Ontario, Quebec and the martimes should be the grade for sale in the prairie provinces and British Columbia, and that the growers or producers in the maritime provinces should not be forced to ship to those places potatoes graded for foreign shipment. Under grade 2, which covers potatoes for the west, the prairie provinces and British Columbia, you find nothing but the diameter system applied, while under the grade for Ontario, Quebec and the maritime provinces, our own potatoes produced in the maritime provinces for sale there are graded not on the diameter system but on the weight system. Our people would like to know the reason for this difference, because it greatly interferes with the sale of their product.
A few weeks ago I asked a question in order to ascertain how many meetings had been held in the province of New Brunswick to explain this new marketing scheme to the potato producers. The minister gave me the number; I think it was eighteen or more, but it does not make very much difference. I have attempted to discover how these meetings were called. Last October or November there was a meeting called in my own county, about sixteen miles from my home. It could not have been very well advertised, because I knew nothing about it and heard nothing about it. I should like to have heard of it; I should like to have attended that meeting. I found that the gentleman who is head of the affair in the northern counties held a meeting at Belkdune, Gloucester county; another at Charlo Station, in Restigouche county, and another meeting at Balmoral, Restigouche county. At those meetings he told the people that the system of grading that was to be introduced would not affect the grading as it was carried on in New Brunswick in the past. What do we find? Those people have been deceived; the grading done to-day in New Brunswick is entirely different from the grading that was done previously under an act of parliament. They were told that there would be no difference, but the difference has been so great that in many places the farmers are unable to grade their potatoes for sale to dealers who buy them for resale, because under the regulations issued under the act and under this scheme when the farmer sells his potatoes to a dealer for resale those potatoes must be graded, and if he has not graded them he is liable to a fine of from $25 to $500, or to imprisonment. Under these rules the grading must be done by using expensive racking machines. In some parts of the province of New Brunswick I have no doubt that can be done to advantage. In the counties along the river St. John, in Carleton county, in Victoria, in Madawaska and in those counties bordering on the state of Maine, they can afford to do that, because they produce veiy large quantities of potatoes. But in other parts of the province, in northern New Brunswick, where the farmer produces for sale only say 150 to

Supply-Agriculture-Marketing Act
200 barrels of potatoes, he cannot possibly grade them under these new regulations. So he must sell them under the condition that the purchaser for resale will grade them, and when that condition is imposed upon him by the purchaser the farmer has to take less per bag or per bushel for the potatoes he sells.
In laying this matter before the minister I was going to direct his attention to another situation which had developed, because up to that time the province of Quebec had not come under the marketing scheme, but the minister informed me the other day that within the last week or so the province of Quebec has come under that scheme.
Now I want to point out conditions which I am informed exist to-day under this scheme in Ontario. No doubt the minister has seen some of this in the press. I have not depended upon the reports appearing in the press; I have gone to some of the largest wholesale dealers and purchasers of potatoes from' the maritimes, in the city of Toronto, in order either to have what I saw in the press verified or to have a definite denial made. From the information I have in my possesion I find that in Ontario the regulations are not enforced with regard to their own production, but they are enforced very strictly in regard to potatoes imported from the maritime provinces. I think the minister will agree that this is correct, because representations were made only a week ago to the central board in Ottawa; this question was discussed and they promised to undertake to see that the situation was corrected. There is also what I consider another very effective means of preventing eastern potatoes from being sold in the province of Ontario or in the large cities as they have been in the past; I refer to the trucking system, the conveyance of potatoes by truck instead of by rail to point of destination, and those trucks not obeying the regulations laid down for transport under the new marketing scheme. My information is that there are constant violations of the regulations under this system of trucking. Not that I wish to argue that the transportation by truck of the farmers' produce should be done away with, but rather that the regulations governing the transportation of potatoes within a province or without a province should be observed. If they are not, what is the use of them? There is no use in having regulations at all if they are not observed, and the violation of these regulations does a great injustice to the producers of potatoes in other parts of Canada. If the price spreads commission had not already made its report, this might well be a

subject worth while investigating, touching as it does the ethics of business.
Another thing. They fix a minimum price in Ontario, and the charge is made both in the press and by reputable wholesale dealers that that price is not being maintained. If that minimum price is not being maintained for Ontario potatoes, and the minimum price is being maintained for potatoes in the maritime provinces, it will readily be seen that an injustice is being done to the producers in other parts of Canada.
Here is another thing that the minister might look into. I do not know if the board has looked into it or not. I understand that the marketing board secured an agreement with the chain stores and larger retailers to maintain a minimum retail price in the city of Toronto. If that is the case, you have a monopoly. There are laws against monopolies, and as a monopoly is against proper business ethics it is time, if such a condition does exist, for the central board to interfere or for the Department of Agriculture to see what should be done under the circumstances.
The minister a few days ago made the statement in the house that New Brunswick or eastern potatoes were being sold to-day at a price far in excess of the price prevailing before this marketing scheme became effective. I hold in my hand a dispatch from the town of Woodstock, New Brunswick, one of the large centres of shipment of New Brunswick potatoes, addressed to the Telegraph-Journal, a newspaper of the city of Saint John, dated March 23, 1935, in which it states that "potatoes on Saturday were selling at twenty cents a barrel," not twenty cents a bag, but twenty cents a barrel. Now it may be said that the minister's statement was correct in regard to the price obtained by the dealer or shipper, but I am referring to the producer, and this dispatch refers to the producer. That is wthy I said that fixing a minimum price at point of destination like Montreal at 55 cents a bag while our growers are receiving only from 15 to 20 cents a bag is not right; it should not be allowed to go on in that way. I claim again that if you fix a minimum price at point of destination you should fix a minimum price also at point of production or point of shipment.
I do not wish to obstruct or prevent the passage of this item to-night, but I feel that I owe a duty to those I represent to bring these matters before the minister, and I felt that I would rather take up the time of the committee in bringing these complaints of the growers of certain sections of the maritime provinces to the attention of the minister himself than lay them before the central

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board. I should like the minister to take into consideration the different points I have made, and if this item does not go through to-night perhaps the minister will be in a position when it comes up again to enlighten me on the different points I have brought to his attention.

Topic:   DEPARTMENT OF AGRICULTURE
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