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Murad Al-Katib
President & CEO - AGT Food and Ingredients

The Future of Canada’s Agriculture & Agri-food Sector

Published on

Takeaways

  1. Saskatchewan has a strong agriculture ecosystem rich in talent and innovation.
  2. Innovation in plant-based proteins, new technologies and digitization of agriculture presents tremendous opportunities for scale in Canada’s agri-food sector.
  3. Physical infrastructure, the development of skills and access to global markets are going to be critical to the innovation agenda for agri-food in Canada.

Action

To achieve scale of its companies, Canada should focus on increasing partnerships within the Protein Industries Supercluster as well as abroad. Canada needs to strengthen global partnerships in operations and investments.


What are the key strengths and weaknesses of Canada’s agri-food industry?

When I look at the key strengths, we start with the basic building block of having a large amount of land and fresh water. Those are two of the scarcest commodities when we look at the rest of the world and its challenges in agriculture. When we marry that up with a network of research & development (R&D) and our farmers’ ability to be early adopters of technology, we have been able to really drive innovation at the farm—whether it is in new varieties, new crops, or the commercialization of cutting-edge farming practices. Zero minimum tillage technologies, soil conservation, water management, and agronomy have all boosted our yields dramatically. These have all been very strong assets.

“Zero minimum tillage technologies, soil conservation, water management, and agronomy have all boosted our yields dramatically.”

Where we have a challenge is our developed value-added processing infrastructure. We lack scale, and with that, innovation into new plant-based protein, new technologies, and the digitization of agriculture will become an opportunity here in Canada. Those are all strong assets as we move forward.


How has COVID-19 affected Canada’s agriculture sector and what actions do you hope to see from governments in support of its recovery?

I have been asked to be one of the leaders of the Economic Strategy Table on Agri-Food on the post-COVID economic strategy. It is very important to realize that in the post-COVID environment, agriculture did well in terms of its reaction—we were one of the sectors least hit. Now, that does not mean we were not affected.

We had skills shortages and labour shortages with the Temporary Foreign Worker Program, in taking in a lot less labour than we would traditionally. We rely on about 60,000 temporary workers to come into our agriculture sector annually. We saw an effect on our supply chains, ports, railways, and banks. We do not think about banks functioning and our ability to get paid for our cargo as a limiting factor in a global supply chain, but these things lead to really slow payments and the slow functioning of the supply chain. But in general, the global demand for food and empty grocery store shelves around the world had a strong demand for Canadian agriculture commodities.

When I look forward, there is an additional layer of cost now with hygiene and with efforts to keep our employees and food products safe. This is going to be an element of cost that we either need to use innovation to drive down or have the government help us with as we go forward.

“It is critical that we drive the digital agriculture transformation.”

When I look forward to the sector overall, it is critical that we drive the digital agriculture transformation. When I focus on infrastructure and our government’s focus, we are going to be insisting on broadband investments across the country to ensure that rural areas have access to modern, fast broadband coverage to be able to digitize our sector. Physical infrastructure, ports, railways, roads and connectivity into gateways and corridors for long-term trade infrastructure is going be critical, as is the development of skills and the access to global markets. This will drive the innovation agenda and as we try to feed the world and look forward, Canada has a great opportunity.


What are some of the global trends that you see affecting the future of agri-food, and how is Canada positioned to take advantage of them?

In the near-term, I see a renewed focus on food inflation, food security, and the government’s role in maintaining buffer stocks which is going to boost demand for the Canadian agriculture commodities sector.

As I look forward, we have to look at fundamental trends like the rise of plant-based protein consumption, water efficiency and the sustainability of agriculture production, these are becoming top of mind for the consumer of the future. Those consumers are in their teens today; they care about the environment, they want information at their fingertips, they want traceability, food safety, and identity preservation. All of these things are going to be important, and that is where technology is going to help us keep up and drive forward.

“I see a renewed focus on food inflation, food security, and the government’s role in maintaining buffer stocks which is going to boost demand for the Canadian agriculture commodities sector.”

If you want to get to have a blockchain certified, traceable, food safe, identity-preserved agricultural system, Canada has the chance to do that. If you try doing it on a one-acre farm in India, it is going to be very difficult. But if you try doing it in Canada where we have scale in agriculture, it is going to be not only doable but part of the agriculture of the future.

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What sort of investments has Canada’s agri-food industry been able to attract and why were they drawn to the region?

The reliable supply of raw materials is going to be one of the foundational parts of attracting innovation in food processing and providing technology companies who are looking to scale up with food, ingredients and semi-refined agriculture products to feed the growing number of middle-class consumers in Asia and the world. That is what we are trying to marry up.

“We expect artificial intelligence and machine learning to have applications on pesticides, herbicides, and agronomic management practices.”

I do see investments by companies who are looking at commercializing wide scale technologies in agriculture. One example is autonomous vehicle technologies related to farm implements and farming management practices. We expect artificial intelligence and machine learning to have applications on pesticides, herbicides, and agronomic management practices. Decision support systems are going to be using sophisticated imagery from cameras and drones. These are all going to be part of the agriculture of the future, where we are able to gather and analyze data to supply a traceable food product to consumer demand. The big opportunity is marrying up that global demand for protein and commodities with value-added products, technology and innovation. That is Canada’s opportunity.


What sort of investments do you want to see more of in the Canadian agri-food sector?

This is all about commercialization of innovation, and the ability to take products like proteins, starches, fibres, flowers and fractions and create nutritious, tasty, cost-effective food products that will be consumed both here and abroad. That is the kind of investment ecosystem that I hope we will be able to develop—an ability to truly develop value-added extrusion, like snacks, bakery mixes and pastas. These are all products that have tremendous growth potential; where we are utilizing healthier ingredients that are going to be able to deliver existing foods but in a super-charged, super-food format—I think that is very exciting.

When I look beyond that, both the fiber and the fuel side have tremendous opportunity in agriculture; the ability for a truly renewable fuel, using canola as a replacement for diesel and jet fuel, or using fibre—which is currently agri-waste—in industrial applications for either paper or plastics. These are the kinds of things that emphasize integrated processing that focuses on food, industrial uses, and feed. Those three opportunities together magnify the growth potential.


How would you describe the availability of talent in Canadas agri-food production, management and R&D?

One of the reasons why our R&D business is centred in Saskatchewan is because the University of Saskatchewan has been a tremendous resource for us for graduates. If you look at our application scientists in our R&D centre in Saskatoon, we have the best and brightest coming out of both Master’s and the PhD programs, and that has been really helpful. When I look at the overall management talent pool here, we have a very strong industry where so many businesses are reliant on agriculture and we can source expertise in accounting, finance, transportation, logistics, marketing and merchandising. We have been able to build a tremendous team here.

We are also seeing that the educational institutions realize the importance of agriculture, and its changing. Today, computer programmers are our target for our information technology group. We have a whole group of programmers that work full-time on enabling our business. Agriculture is not just the farm gate anymore; it is far beyond—and here in Canada we recognize that.  That is where our talent pool is going to become one of our biggest advantages.


Why is Canada’s Protein Industries Supercluster important in terms of attracting investment to the agri-food sector?

I was one of the architects of writing and building the Protein Supercluster. Protein Industries Canada gives us the ability to leverage the experience of those larger companies that are driving innovation. I have a project that was just approved in which we partnered with a women-led startup, and we are going to be developing pulses-based tofu and non-meat alternatives. We are working with a very dynamic, young woman entrepreneur and she benefits from our work as a larger company in the cluster, while we benefit from her innovation, enthusiasm and drive. That is what this cluster is all about: attracting large companies and small companies together to truly make innovation commercialized. There is no doubt in my mind that Protein Industries Canada is going to be a driver of investment and we are looking forward to what happens next, because we have done very well at commercializing our supercluster and I think that the best is yet to come.


How do we make Canada a global leader in agri-food?

We are an example of a company that took a value chain approach, and we invested in assets at origination and value-added processing. We got involved in freight logistics, now we are involved in port and processing facilities around the world and global distribution.

The superclusters are going to help us to get companies working together. If we do not have scale in the size of companies, maybe we need to scale in partnerships—and I believe that is a strong opportunity that the supercluster presents. It will help us to encourage Canadian and global partnerships not only in operations, but also in investment. It is very critical that we continue to invest and partner abroad to ensure that we have an ability to achieve scale.

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The Investment Attraction Series is Supported by

Murad Al-Katib
President & CEO - AGT Food and Ingredients

Bio: Murad Al-Katib founded AGT Foods in 2001, building a Canadian startup into a global billion-dollar value-added foods and ingredients company. Among other board positions, he serves as Chair of the Government of Canada’s National Agri-Food Strategy Roundtable. He is also the recipient of many prestigious awards, including the 2017 Saskatchewan Order of Merit, the honouree of the 2017 “Oslo Business for Peace”, and EY’s 2017 “World Entrepreneur of the Year.”

 

Organization Profile: AGT Food and Ingredients provides pulse crops, specialty crops, staple foods, pasta, bulgur, rice and food ingredients to domestic and export markets. It is one of the largest suppliers of food in the world, and serves a network of customers in the Americas, Europe, Africa and Asia. The company was founded in 2007, with headquarters in Regina, Saskatchewan.