By Carlo Dade
Published in the Winnipeg Free Press

October 10, 2018

The new U.S.-Mexico-Canada Agreement (USMCA) is good news for Canadian producers, and for investors seeking certainty in Canada. But amid relief at reaching the deal, Canada cannot forget the painful lessons of what we went through to get the agreement — or lose the momentum to diversify our exports.

This diversification that the entire country, and particularly Western Canada, needs means more than just moving the same products to new markets — it means a full-court press to move new products, both to new markets and to the U.S.

Fortunately for Western producers, one such opportunity has been quietly emerging from the Prairies: plant-based proteins and ingredients. On Oct. 3, the protein industries supercluster launched in Winnipeg. The supercluster is an industry-led consortium of small- to large-sized enterprises, research, academia, associations and governments involved in food and food-ingredient manufacturing, agriculture and food-related services. For the Prairies, and Manitoba in particular, this could be huge.

Over the next 10 years, the plant protein industry is expected to create more than 4,500 jobs and have a GDP impact of more than $4.5 billion. Manitoba is poised to lead. Canada’s first big plant protein processing facility (Roquette) set up stakes in Portage la Prairie, and the province is already home to a wealth of agriculture and crop science knowledge.

The new products being produced in the Prairies, such as ingredients for the new meatless A&W burger, are arguably the single best opportunity for moving into higher value-added exports that has come along in Canada in generations. Canada could come to dominate these opportunities globally, but only if we get our act together and take bold steps to grow the industry — now.

The opportunity in plant protein arises from the unprecedented rise in global demand for protein of all types. There are four major protein demands — all fuelled by a rising global population — that can be met by plant protein: fish feed, animal feed, human food and animal protein (which is fed by plant protein). There is also rising demand for other uses of derivatives of these products for the pharmaceutical and personal-care industries. In Canada, we have quietly already seen a manifestation of this demand when A&W had to suspend sales of its plant-protein Beyond Meat burgers due to it being too popular and demand “exceeding expectations.” This is only a glimpse of the popularity to come.

The opportunity for the Prairies is to become the first-choice supplier for all manifestations of this demand, and particularly the higher profit value-added.

The opportunity for Canada has been made better by the gift of significant tariff advantages handed to us by our biggest competitor, the United States, thanks to its withdrawal from trade negotiations with Europe and withdrawing from the Trans-Pacific Partnership agreement — both groups with which Canada has signed agreements.

This is clearly an opportunity, and this has been recognized by foreign firms like Roquette, which has invested in Manitoba. But this opportunity is not going to land itself. Canada and the Prairies are going to have to go the final yard to dominate the industry globally.

This will require us to do three things.

First, ensure that we are ready to seize the opportunity, and that our labour force, infrastructure, transportation and, most importantly, regulatory systems match what will be needed by processors looking to invest in Canada. This is a global opportunity with global competition; we cannot afford to embarrass ourselves and scare off investors by not having our act together.

Second, we have to co-operate across the Prairies. We can fight among ourselves or we can fight the Americans for every investment that comes along.

Third, we need to be ambitious. If we are competing on the global stage, then our ambition must be to dominate.

This is plant protein’s moment in Canada, but it is a moment that will not last forever. We need to move now. We need to do so together. And that starts officially this month in Winnipeg

Carlo Dade is the director of the Trade & Investment Centre at the Canada West Foundation