“NAVIGATING THE CANADIAN MARKETPLACE” THROUGH TOWN HALL MEETINGS

Information is power in avoiding 'gotchas' when exporting to Canada

It’s not a far-fetched scenario. In fact, says Mike Aerts, FFVA’s director of membership and marketing, it happens more often that you’d think. It’s just one of many pitfalls for Florida growers who want to do business with Canada.

AN UNTAPPED MARKET

Mike Aerts, FFVA's director of membership and marketing, explains potential pitfalls of exporting goods to Canada during a recent 'town hall meeting.'

Florida exported $736 million in agricultural goods to Canada in 2007, the latest year for which figures are available, according to the Canadian government. Exports of live, fresh or chilled crop products totaled $333.4 million. Fresh tomatoes are a leading export crop, accounting for about 10 percent of Florida’s production every year.

Three out of every four dollars spent in Canada on fresh produce are spent on imported produce, yet Florida products represent only a fraction (about 6 percent in 2008) of all of Canada’s fresh produce imports.

That indicates the untapped opportunities for Florida producers. But there are numerous challenges and a lot of potential for “gotchas,” Aerts told those who attended the meetings in six locations throughout Florida and Georgia. A team of presenters outlined a variety of information growers need to know in order to do business in Canada.

ASSURING 'SMOOTH FLOW OF PRODUCT'

Anne Proctor, vice president of policy and issue management for the Canadian Produce Marketing Association, and Adrian Abbott, CPMA’s board chairman, kicked off the meeting with an overview of how their organization works to resolve trade issues. CPMA’s Grower/Shipper Committee and North American Trade Committee (which includes the Produce Marketing Association and United Fresh Produce Association), both work to facilitate trade. Additionally, an issues management working group of representatives from government and regulatory agencies within Canada provides a forum to encourage discussion of issues.

“We’re all about making sure there is a smooth flow of product,” Proctor said.

The good news is that Canada is a great market. The flip side is that it’s not a good market in which to be paid, said Pat Hanemann of Farm2Market Agribusiness Consulting Inc.

“We all work really hard. But after all the blood, sweat and tears, if we don’t get our bills paid we can’t pay our bills in return,” he said. Growers have experienced problems with slow payments or no payments at all, he said. That’s where the Dispute Resolution Corp. comes in.

Adrian Abbot, chairman of the Canadian Produce Marketing Association, explains how his organization works to resolve trade issues.

LABELING REQUIREMENTS CAN BE TRICKY

From a food safety standpoint, buyer expectations in Canada don’t differ much from those in the United States, Proctor said. They expect their suppliers to have the ability to trace back product and want on-farm food-safety programs to be compatible with GlobalGap.

Labeling is a different story. The requirements can be a minefield for the uninformed. Sally Blackman, manager of food safety and nutrition for CPMA, helps companies navigate the labeling and language regulations.

Labeling is subject to inspection, and non-compliant labeling could be considered an infraction, Blackman said. Bulk, prepackaged items and master shipping containers are exempt from most labeling, she said. That includes unpackaged product or product bundled with a small band, in clear wrap or in open bags.

For prepackaged products, label requirements can include the common name, net contents, country of origin, grade (if applicable), ingredient list, nutrition facts label – although most products are exempt from this, Blackman said – with the nutrition presented in the Canadian-formatted table. Required information must be in English and French. In Quebec, the bar is higher: Any information on a package – including recipes – must be in both languages, and the French translation must be displayed as prominently as the English.

The same holds true for the PLU sticker. Product sold anywhere in Canada must have required PLU information in both languages. Additional, non-required information on the PLU also must be in French for any product sold in Quebec. Blackman recommends including only required information on the PLU to avoid additional costs and the risk of being non-compliant.

CPMA’s Web site offers its members a reference for data required on PLUs at  www.cpma.ca/en_ind_plu.asp. Information also is available at www.PLUcodes.com. CPMA also offers an online fresh fruit and vegetable labeling tool to guide its members through the labeling process.

WORKING TO HARMONIZE MRLs

Anne Proctor, vice president of policy and issue management for the Canadian Produce Marketing Association, said her organization is "all about making sure there is a smooth flow of product" between the U.S. and Canada.

FFVA and other industry groups are “doing everything we can on the front end of the curve to make sure there’s no trade disruption,” Aerts said. This potential trade irritant has become a priority for not just grower organizations but for government officials on both sides of the borders, and registrants as well.

An industry initiative is underway to identify and prioritize crop-protection chemicals. Information is being gathered from Florida growers and compiled in a database that serves as a source for registrants and regulators alike to understand which materials are most important to producers.

The database, found at www.uscanadagrowerprioritydatabase.com, is funded by a Technical Assistance for Specialty Crops grant from USDA’s Foreign Agricultural Service. It compares Canadian MRLs and U.S. tolerances so registrants and regulators can see exactly where to direct their efforts in getting those numbers to match.

Why is it important for registrants? U.S. growers who want to export won’t buy products that don’t have a corresponding MRL in Canada (or Japan, or the European Union, or Korea), so registrants are more likely to register or at least establish an MRL for their products there. The database also gives regulators valuable information in making decisions about which labels to review and in what order. 

It’s a complex issue, and there is much work to be done. Some chemicals are registered in the United States but don’t have a use in Canada – such as products used for citrus, Aerts said. And many times, MRLs are stricter in Canada than they are here. For example, Captan is used in Florida on strawberries, but berries with legal U.S. Captan tolerances would be declared adulterated in Canada.

On a larger scale, the MRL harmonization issue has attracted the attention of the European Union and other countries, Aerts said. The topic was the focus of the 2007 Global Minor Use Summit in Rome, with the differences in MRLs for specialty crops discussed among the countries represented. “Harmonization efforts are going forward,” Aerts said. “Countries are cooperating in reviews on chemicals. That’s a positive, because we need as much cooperation as possible.

“The world is small, and until we get this harmonization effort completed correctly, we have to make sure that before we ship commodities to other countries they are within legal specifications of the country where we’re shipping,” he added.

Grower participation is key to making the harmonization effort succeed, however, Aerts said. FFVA still needs information from growers on priority crop-protection tools so it can be added to the database.  For example, $45 million worth of peppers are shipped to Canada from Florida every year, but the database doesn’t include any information on the crop. Aerts invites growers to contact FFVA by phone or e-mail with any questions or to provide information on expanding or refining the database.
 

In the meantime, growers can check the database to see the Canadian MRLs for materials they are using to avoid those so-called “gotchas.”

“We don’t want a trade irritant to pop up because an MRL issue reared its ugly head in the process,” Aerts said.