1. Ontario’s Agri-Food Sector D R A F T February 2008

2. 2 Table of Contents 1.Ontario Agri-food sector overview 2.Focus on the Horticulture Sector 3.New and Emerging Opportunities 4.Mission to Chile

3. 3 Ontario Agri-food Sector Overview

4. 4 Ontario Agri-Food Overview Sector includes the entire value chain from field to fork Sector is notable for its diversity –more than 200 different commodities produced –sugar/confectionary products, baked goods and meat products accounted for almost half of the $6.5 B in food processing exports (2006) Significant contributor to the economy –sales over $30 billion and 700,000 jobs

5. 5 Ontario - Well Positioned in the North American Market Source: Source: U.S. Census Bureau, 2006 (3/2007) http://www.2ontario.com/welcome/oomp_401.asp 135 million consumers within a day’s drive of Toronto (representing 44% of U.S. population)

6. 6 Selected Economic Indicators, 2006 10.6 % = Ontario agri-food goods as % of Ontario’s GDP from all goods- producing industries 45.4 % = Ontario GDP from food, beverages and tobacco as % of Canada’s GDP from same 23.6 % = Ontario agriculture as % of Canada’s GDP from agriculture $8.93 billion (CDN) = Total Farm Cash Receipts Agri-food Trade: Imports $13.46(billion $CDN) Exports $8.59 (billion $CDN) 11.5 % = Employment in agri-food as % of Ontario’s total employment

7. 7 Ontario’s Agri-food Trade by Region/Country RegionExportsImportsBalance United States3,583,7074,844,631-1,260,924 Asia (excl. Japan)318,506503,301-184,795 EU199,462634,577-435,116 Mexico155,082442,416-287,334 Japan100,51013,84386,668 Other208,9851,062,718-853,733 Total4,566,2537,501,486-2,935,233 January – July 2007($CAN'000)

8. 8 The Changing Ontario Farm l Census of Agriculture2006 2001 Total Land Area (millions of acres)13.3113.51 Average Farm Size (acres)233226 Ownership Sole proprietorship Family corporation Non-family corporation Partnerships Other 31,755 7,538 733 34,933 54 33,675 6,670 605 48,321 54 Total # Farm Operators82,41085,015 Female Farm Operators (%)28.626.8 Average Age of Farm Operators (years) - compared to average age of Cdn farm operators - compared to average age of Ontarians: 52.6 52.0 39.0 50.7 49.9 37.2 Operators with Off-Farm Income (%)49.645.5 Farm Capital (billions of $)65.350.5 Total gross farm receipts (billions of $)10.314.5 www.ars.usda.gov/is/graphics/photos/

9. 9 Farm Cash Receipts Selected Commodities, 2006 Commodity $ million 2006 % in 2006 % in 2002 Livestock (excluding Poultry & Dairy)1,990.922.321.6 Dairy Products1,990.917.817.7 Grains and Oilseeds1,295.414.514.9 Fruit and Vegetables1,140.212.811.8 Floriculture and Nursery987.111.111.7 Poultry and Eggs847.19.510.0 Tobacco178.42.02.5 Maple Products11.00.120.13 Other886.09.99.6 Total Receipts8,927.0100

10. 10 Focus on the Horticulture Sector

11. 11 The Horticulture and Greenhouse Industry Horticulture: Horticulture is a $2B farm gate ($1B fruit and vegetables, $1B floriculture/nursery) Ontario Horticulture industry represents over 40% of national horticulture crop production. Greenhouse Industry: Ontario Greenhouse Industry = 1000 hectares $1.1 Billion farm gate sales (flowers and vegetables) $4 billion of additional industrial output and labour income province-wide 51% of Canada’s greenhouse production in Ontario #1 production of greenhouse vegetables and #3 of greenhouse flowers in North America Significant reliance on exports to U.S. – High Can $ a big concern Energy and labour highest input costs

12. 12 Grape & Wine Industry Over 60 wineries and 15,000 acres of grape Represents more than 80% of Ontario’s $215 million industry Significant contribution to Niagara tourism

13. 13 Horticulture Sector Issues Emerging Pests Pesticide Issues (reduced-risk, minor use, data requirements, alternative fumigants, spray drift, pesticide by-laws, product re-evaluation and formulation changes) Food Quality (Optimum quality for consumer, Need to identify Health benefits, Organic guidelines) Post Harvest Market Access Winter Injury/Salt Damage Land Use Legislation – Clean Water Act Water and waste management Labour Wildlife Damage Food Safety and Traceability Energy – increased heating, transportation, fertilizer, plastic costs Research funding –decreased support for production and IPM, increased need for new crop research Genetics: lack of control over germplasm, lack of new varieties being developed, importation of seed from China and GM0’s

14. 14 Area, Production and Farm Value of Selected Commercial Fruit Crops, Ontario, 2006 Crop (top 12 by production) Area Harvested (hectares) Average Price ($/tonne) Farm Value ($,000) 1)Apples6,758377.0060,809 2)Grapes (all)7,0171,094.6074,283 3)Peaches2,0071,196.2026,181 4)Melons (all)482448.206,200 5)Pears708809.406,665 6)Strawberries1,0082,933.1015,300 7)Sour Cherries832521.601,527 8)Nectarines2231,433.003,900 9)Plums & Prunes3441,719.603,900 10)Sweet Cherries3242,391.903,845 11)Blueberries (all)1664,467.303,080 12)Raspberries3125,394.603,230 References: tatistics Canada: Fruit and Vegetable Survey; OMAFRA: Apple Marketing Survey; Ontario Tender Fruit Producers' Marketing Board; Grape Growers of Ontario

15. 15 Area, Production and Farm Value of Selected Commercial Vegetable Crops, Ontario, 2006 Crop (top 12 by production) Area Harvested (hectares) Average Price ($/tonne) Farm Value ($,000) 1)Potatoes14,600n/a 2)Garlic873,873.00650 3)Leeks611,289.801,410 4) Lettuce, Greenhouse n/a1,504.302,000 5)Carrots, Baby2831,322.801,800 6)Parsnips97412.70730 7)Spinach3761,202.502,400 8)Asparagus1,0932,762.909,650 9)Cabbage, Chinese 688983.605,800 10)Beets425226.501,500 11)Broccoli1,3051,181.509,950 12)Cauliflower668632.506,900 References: tatistics Canada: Fruit and Vegetable Survey; OMAFRA: Apple Marketing Survey; Ontario Tender Fruit Producers' Marketing Board; Grape Growers of Ontario

16. 16 New and Emerging Opportunities

17. 17 Agri-Food: More than Agriculture + Food More than just primary production Sector increasingly shifting to value-added products to capture niche markets Pursuit of innovative production methods/products allows sector to maintain economic strength Continued development of technologies and expertise to address emerging challenges and opportunities

18. 18 Opportunities for Agri-Food Energy Environment Consumer Trends Science and Innovation

19. 19 Opportunity: Energy Three categories of renewable energy associated with the agri-food sector: Biofuels - derived from starchy crops Biomass - living and recently dead biological material used as fuel or industrial production Other renewable sources – eg. solar, wind, anaerobic digesters www.sgaenergy.com

20. 20 Opportunity: Environment Environmental Farm Management – optimize outputs; minimize inputs and environmental impacts Air – reduction of effects on air quality Climate Change - potential to provide a net reduction in atmospheric CO2 Soil – practices to guard against soil degradation and loss Biodiversity – safeguard existing natural/semi-natural habitats Water – methods to maintain quality/quantity of supply To be sustainable, agricultural systems must be compatible with natural systems and processes:

21. 21 Opportunity: Consumer Trends Adaptation / adjustments to meet changing consumer preferences: Convenience Awareness of food origins Formulated for children Fresh produce Functional foods Lifestyle foods Organics Portion Control Upscale / gourmet foods

22. 22 Opportunity: Science & Innovation Agricultural research (to date) that influences agri- food production & processing: biotechnology market development novel technologies processing technology production systems technology transfer

23. 23 Example: Auto-parts Sector

24. 24 Example: Construction Sector Biocomposite bridge was installed at the University of Guelph Arboretum, donated by PSA Composites LLC

25. 25 Mission to Chile

26. 26 Mission Vision Mission Vision : A research project has been funded by the federal and provincial ministries of agriculture in collaboration with producer associations to carry out this analysis and to develop of a long term strategic plan for the industry. This work will be informed by best practices from jurisdictions that have well-developed horticultural sectors. The following jurisdictions have been identified for the data-gathering phase of the project: Australia, California, Chile, Denmark, Holland, and New Zealand. Mission teams will visit these countries and meet with industry, academia, and government officials to discuss best practices for the horticultural sector in research, innovation and commercialization and government support.

27. 27 Mission Funding Partners and Mission Team Mission Funding Partners : Agriculture and Agri-food Canada Ontario Ministry of Agriculture, Food and Rural Affairs Horticulture producer associations Mission Team : Dr. Frank Ingratta, former Deputy Minister of the Ontario Ministry of Agriculture, Food and Rural Affairs, Principal Investigator of the project. Ms. Brenda Lammens, President of the Ontario Fruit and Vegetable Growers Association (OFVGA). This 7500 member organization is responsible for advocating for industry needs. Ms. Kate Steflemeyer, Research Associate with the George Morris Centre, Canada's leading agricultural think- tank. Dr. Maurice Bitran, former Director of Research and Innovation at the Ontario Ministry of Agriculture, Food and Rural Affairs, the Ontario Ethanol Growth Fund, and the Ontario Research and Development Challenge Fund.

28. Websites Ontario Fruit and Vegetable Growers Association http://www.ofvga.org/ Ontario Ministry of Agriculture, Food and Rural Affairs: http://www.omafra.gov.on.ca http://www.omafra.gov.on.ca George Morris Centre http://www.georgemorris.org 28