Good afternoon. Thank you for inviting me to appear today.

My name is Mike Beaulieu. I'm the vice-president of the North West Company's Canadian store operations. I'm joining you today from a back office at our store in Iqaluit, where I am participating in the Nunavut Roundtable for Poverty Reduction this week.

The North West Company is a retailer operating in underserved communities across Canada, the South Pacific, the Caribbean and the United States. Our operations in Canada are predominantly in the north, although not exclusively.

Today, I will focus solely on our operations in the Canadian north. The north is a special place for me. It's where I started my career, where I met my wife and where my family still lives. I have lived in the territorial and provincial north, and I know the realities of the people who must navigate the region's unique challenges every day. When I talk about our northern operations, this is very real for me. Our ability to serve these communities means serving my loved ones, too.

Transportation is a critical part of food availability and food prices in the north. Our stores rely on air freight, sea barges, ice roads and rail lines, facing logistical challenges that do not exist in southern Canada or in most of the world. Many of these challenges have been exacerbated by climate change and are all the more difficult due to the current state of northern infrastructure.

We recently learned that, yet again, barges supplying the Mackenzie River will be cancelled. The Hay River community—which was devastated by wildfires last year—and the communities in the Sahtu region will be particularly hard hit. We are again trying to find new routes to supply communities throughout the Northwest Territories with essential food and other goods, which we may need to do through air cargo services.

While the nutrition north Canada program has been flexible in working with us to offset these costs to our customers, the program is not a solution on its own. We need to do more to strengthen our supply chains and lower the cost of transportation in the north.

Each year, with growing frequency, our road, rail and air shipments are cancelled or delayed due to floods, forest fires or other reasons. Disruptions mean more food spoils while sitting on runways. This can mean communities face shortages of healthy foods or critical hygiene goods. It's bad for everyone. Air freight is expensive, but it's often the most reliable way to get goods to communities. Nonetheless, melting permafrost and prolonged wet seasons mean our shipments are often delayed because runways are out of service for extended periods of time.

In the north, we often experience severe difficulties with our air deliveries due to weather, which is severe and, due to the lack of weather reporting services, makes it even more difficult for airlines to plan for local conditions. Additionally, the lack of local de-icing services results in many flights never being attempted. The scarcity of paved runways restricts aircraft size and capacity. Labour shortages and other factors mean our shipments are often delayed or cancelled. These transport disruptions, in turn, create cost pressures.

There's limited competition for air freight in the north. As you are aware, many northern communities are small and lack airport infrastructure like hangars or unloading equipment. Conditions are not favourable for competition, so we have few options. While we negotiate the lowest rates we can, the same high operating costs that impact all carriers keep rates high. Even if there was more competition, realities on the ground would likely mean that cargo rates would continue to be high. Lower operating costs and conditions that favour larger, more efficient aircraft are needed to effect change.

I want to note, however, that there are other challenges once freight arrives in communities, including local delivery issues from the plane to the store and infrastructure shortages. While I recognize that this study is about airlines, it's important to take the entire supply network into account so that we can lower prices for our communities. I believe there's ample room to work together for the benefit of our northern communities.

Of note, in recent emergency events like last year's forest fires in Quebec and the Northwest Territories, we observed that we had access to information on the ground, technical knowledge that governments could benefit from. The airlines did, too. Together with the government, we can help Canada with logistics to help communities when they are in need. We also observed the challenges across the northern supply chain caused by labour shortages.

The north requires significant attention and investment. We cannot lose sight of the importance of the people in the region. We are, first and foremost, a business about people, providing essential lifelines to communities. The North West Company wishes to be the government's partner to support northern communities and northerners.

I look forward to answering your questions.

Thank you.