The Canadian government funds agricultural export market development through Agriculture and Agri-Food Canada's (AAFC) Agriculture Trade Service (ATS), which operates in partnership with the Department of Foreign Affairs and International Trade's (DFAIT) Program for Export Market Development (PEMD) to benefit the agriculture, fishery, and forestry sectors. Other Canadian government agencies and provincial governments also fund export market promotion. Federal and provincial export promotion funding for 1995/96 was estimated at Can$15.6 million ($11.4 million). The Canadian Wheat Board, a Crown Corporation, helps fund export promotions through the Canadian International Grains Institute. It is estimated that the Canadian government provides about Can$1.3 million (about $900,000) to the Canadian Grains Institute. Industry funding was estimated at Can$14.3 million (US$12.2 million) for 1995/96. Government, producer and industry funds totaled $24.5 million for 1995/96.
Agriculture and Agri-Food Canada's (AAFC) Market and Industry Services Branch (MISB) takes the lead in developing Canada's agricultural trade. In 1995/96, the Canadian government set a goal of Can $20 billion (US$15 billion) in agricultural exports by the Year 2000, an increase of 15 percent from 1995 exports. In spite of massive budget reductions, the Canadian government restructured its export promotion of agricultural products and increased funding for the promotion activities to help boost exports. The centerpiece of market development is a program entitled the Agri-Food Trade Service (ATS). The ATS coordinates the partnership between Agriculture and Agri-Food Canada and the Department of Foreign Affairs and International Trade (DFAIT) to provide export market development programs to Canadian agriculture. Launched in June 1995, the ATS serves as the umbrella to the following initiatives: the former Trade Opportunities Strategy, the Canadian Agri-Food Development Initiative, Getting Ready to Go Global, and the Canadian Wine Market Development Initiative. AFT 2000 also includes a branded promotion program similar to that of the U.S. Market Access Program (MAP).
The DFAIT's PEMD is a general promotion program for exports of all Canadian products, including agricultural products. PEMD is a financial risk-sharing program which includes access to international market information and services in facilitating export links. Financial outlays are allocated as individual proposals are approved. If export sales result from a PEMD plan or mission, the companies are required to reimburse a portion of the PEMD contribution. Each agreement contains a repayment clause that stipulates the terms under which the applicant will repay the Government of Canada. One element of the PEMD is the Special Activities plan directed at agricultural trade associations. It is estimated that 60-70 percent of the PEMD agriculture budget is directed under the Special Activities Program. Activities by these associations must be for the benefit of their members and may include the generic promotion of the association's products or services. Funds allocated to trade associations are not repayable. PEMD provides financial assistance of 50 percent on selected travel, trade fair participation, and other export- and export promotion-related costs. PEMD also includes a very small branded cost-share promotion program. PEMD services are available to Canadian agricultural exporters at regional offices in all ten provinces. Several International Trade departmental divisions and other government departments operate federal programs which connect to the PEMD program pipeline. An example is the International Business Development program of the International Trade Division. The program provides sectoral specialists to evaluate PEMD applications.
To be eligible for AFT 2000 and PEMD monies, private companies must participate through non-profit agri-food associations participating in the Agri-Food Market Strategies or AIMS process. Under AIMS, participating associations must develop a long term export market strategy that is reviewed by an interdepartmental (usually AAFC & DFAIT) Steering Committee. Branded promotion applicants require an export strategy acceptable to the AIMS Steering Committee which must demonstrate that the industry represented is being disadvantaged by brand promotions supported by the U.S. MAP, or similar programs of other exporting countries. Eligible activities for reimbursement under the PEMD branded program are: advertising, trade show booth construction and other costs, instore and food service promotions, production and distribution of promotional information, and seminars designed to inform trade representatives of the specific attributes of Canadian food products.
Applicants for PEMD generic and brand funding must describe the market conditions and constraints and the likelihood of overcoming the constraints with AFT 2000 funding. They also must estimate the change in exports and/or market share expected as a result of overcoming the constraints.
The primary target areas for Canadian agricultural export promotions are the NAFTA countries and Asia (Japan, South Korea, and ASEAN countries).
AAFC also operates information, intelligence and analysis services for Canadian agricultural exporters, including an electronic Commodity Bulletin Board, electronic trade leads, and market assessment and advisory reports. For 1996-97, AAFC is planning Export Market Assessment Reports for Mexico, South Korea, the ASEAN countries and the European Union. AAFC's market intelligence activities are valued at C$17 million. However, this number is not included in Canada's total expenditures for export market promotion, because market research and analysis similar to those of USDA's Foreign Agricultural Service (and to a certain extent, the Economic Research Service) have not been included in other countries' total promotion expenditures when the costs of these activities could be separated from other market promotion activities.
The Canadian Wheat Board (CWB) is authorized under the Canadian Wheat Board Act of 1935 to control the export marketing of Canadian wheat and barley. The CWB exports all western Canadian wheat and barley (Manitoba, Saskatchewan, Alberta, Peace River area of British Colombia) and issues export licenses for wheat produced in other regions of Canada (the Ontario Wheat Producers Marketing Board). Seventy-five percent of Canadian wheat and 30 percent of Canadian barley is exported.
The CWB offers its producers and foreign buyers a host of services. Price pools ensure the same price for all types of wheats. The CWB controls the procurement, storage, and shipment of grain for export. For foreign buyers, the CWB extends loans guaranteed by the Canadian government for the purchases of 1.86 million tons of wheat in the 1994/95 marketing year to Brazil, Iran, Jamaica, Pakistan, and Uzbekistan. (In 1990/91, CWB loans covered sales of 9.6 million tons of wheat and barley.) The CWB also has signed long-term agreements in the past with the former Soviet Union, China and other countries.
The Canadian International Grains Institute, a non-profit educational and market development institute, offers instruction in grain handling and transportation, marketing and technology to grain handlers and millers throughout the world. The CWB contributes 40 percent of the Canadian International Grains Institute budget. The CWB hosted incoming trade missions from 30 countries in 1994/95, and participated in outgoing missions to 39 countries. Some of the countries participating in the CWB/CIGI missions and other market development activities include: China, Mexico, Malaysia, Tunisia, Korea, Taiwan, and Thailand.
Industry Promotions. Some important commodity groups and organizations are active in export market development and fund their own activities. Others are covered, at least in part, by the federal PEMD umbrella. Producer and industry groups promote the following Canadian agricultural products in export markets: canola, aquaculture, tobacco, forestry products, flax, wine, special crops, pork, furs, beef, wild and domestic blueberries, dairy products, dairy and livestock genetics and soybeans. Agricultural industry trade groups budgeted an estimated Canadian $14.3 million (US$12.2 million) for export promotion in 1995/96, an increase of about 20 percent from year-earlier funding.