The challenges facing the Canadian fruit and vegetable industry, particularly within the North American market, are becoming more complex and demanding. To remain competitive the sector needs to find a better way to develop and implement improved business practices.  The Fresh Produce Alliance (FPA) was established to identify and consolidate multi-stakeholder issues which are cross-sectoral in nature, validate potential solutions and facilitate the necessary action to generate change.  As such, it brings together the Canadian Produce Marketing Association, the Canadian Horticultural Council and the Dispute Resolution Corporation in collaboration to fabricate an improved business climate for the fresh produce industry.

From a public policy perspective, it is essential that industry functions within a policy framework that supports fair and ethical business practices in increasingly competitive markets.  This, in turn, encourages new business practices which support expanded trade and the on-going prosperity of the entire sector.  Conversely, unethical business practices in a market dealing with highly perishable products erode confidence in the industry and damage Canada’s trading image.

Marketing of fresh fruits and vegetables is diversified.  It is estimated there are more than 400 different kinds of fresh produce sold in the Canadian marketplace.  Consistency of supply and quality are constant challenges facing the Canadian produce value chain, due to high perish ability, diversity of supply and a fragmented approach to marketing.  The application and use of product quality and marketing standards and their enforcement through inspection and other related services are and will continue to be important factors in the marketing of Canadian fresh fruits and vegetables in the North American marketplace.  The growing importance of these issues has become more apparent through the past decade of regulatory change and transition.

As the North American market experiences further changes and new challenges, future successes will depend on a strong partnership between the Canadian public and private sectors with industry led initiatives supported by government regulatory and service systems.

The challenges facing both industry and government include:

  • a policy framework which supports fair and ethical business practices

  • promoting the economic viability of legitimate Canadian businesses and industry self-reliance

  • mitigating business and market risks

  • promoting Canada’s reputation nationally and internationally

  • meeting Canada’s international trading obligations

  • maintaining reciprocity with USDA PACA

  • strengthening industry/government partnerships

  • maintaining grades, trading standards, and a strong regulatory framework for enforcement purposes

  • strengthening licensing provisions, dispute settlement mechanisms and inspection services

  • managing operational costs and fees for government services

 

Research and consultation activities by industry with government support over the last three years have identified five key initiatives that are essential elements for establishing a more positive business environment for the Canadian produce sector.

  1. improved destination inspection;

  2. changes to the Licensing and Arbitration Regulations

  3. prevention of fraudulent practices (including    bankruptcies and insolvencies)

  4. establishment of Canadian “trust provisions"

  5. standardization of grades and procedures.

In the past, both government and industry have been working together in an ad-hoc fashion to build a fair and ethical business environment (regulatory and otherwise) for fresh fruits and vegetables.  However, recent circumstances have dictated a more urgent call to forge ahead quickly with attaining the objectives in these five areas.  These issues are germane to the continued success and viability of the Canadian fruit and vegetable industry and Canada’s ability to maintain a fair trading business climate in Canada and with its trade partners.  Success in these areas will again establish a solid footing for the industry that will ensure its success for decades ahead. 

More action is needed in these areas to assist in maintaining a stable North American produce market, in which Canadians can compete effectively with growers, fresh-cut processors and traders from all over the world, especially those in the U.S. and Mexico.

Industry has endorsed pursuing solutions in these areas as priorities at recent conventions of the Canadian Produce Marketing Association and the Canadian Horticultural Council.  The Dispute Resolution Corporation is also fully supportive of these initiatives as it sees change in these areas as a strengthening of the Canadian marketplace.  They are seen as vital ingredients in maintaining and strengthening a credible Canadian role under the spirit of NAFTA in the North American marketplace.

It is important for the fresh produce industry to collectively address the challenges facing the sector, in partnership with government, in order to provide an improved business climate for the sector. All five key initiatives are related, complement one another and require collaborative action by industry and government.

 

Future successes will depend on a strong partnership between the Canadian public and private sectors with industry-led initiatives supported by government policy, regulatory and service systems.

An agricultural portfolio approach is required to facilitate policy and program change in support of fair & ethical business practices for trading fresh produce in the North American marketplace.  The industry led Horticultural Value Chain Roundtable provides a unique forum for industry/government dialogue and could become the reference point for future discussions and validation of necessary policy change.

Copyright FPA 2006