Transition to new agreement for Canadian chicken production a bumpy road

Wednesday, March 9, 2016

by SUSAN MANN

MISSISSAUGA—Chicken Farmers of Canada now has 14 of the 19 signatures it needs from provinces on the legal document of its new agreement for allocating the country’s chicken production and market growth.

Yet the national industry organization still faces hurdles in its longstanding quest to obtain unanimous agreement to allocate the majority of quota generated by market growth on the basis of where the growth is happening.

Dave Janzen, chair of Chicken Farmers of Canada, said Ontario has signed the deal. However, signatures are needed from British Columbia, Quebec and Saskatchewan.

In British Columbia, the processors’ association filed a complaint against the new system, he said during a break in the Chicken Farmers of Ontario annual meeting Tuesday. The agreement has been in use since late 2014 after provinces completed a memorandum of understanding that took six years to negotiate.
 
Janzen said the British Columbia processors’ association “did not feel the B.C. chicken board should be signing the agreement. They’re awaiting a hearing by the supervisory board.”

The new agreement is working well, Janzen noted. But western-based processors have been unhappy with it since its inception because “they are opposed to central Canada, namely Ontario, getting additional growth. That has been their argument.”

In Quebec, “as far as we know, they’re in favour of signing it. They’re just going through a bit of a hearing. The (Régie des marchés agricole et alimentaires du Quebec) is holding a hearing this Friday on the merits of Quebec signing the agreement,” he said.

The Régie is Quebec’s agriculture and food marketing bureau that fosters the orderly marketing of agriculture and food products. It also helps foster harmonious relations between various sectors and settles problems related to production and marketing of agriculture and food products.

In Saskatchewan, Chicken Farmers is just waiting for the supervisory board from that province to sign. The Saskatchewan chicken farmers organization has already signed.

The agreement also cleared a major hurdle in September 2015 after the Farm Products Council of Canada released a decision allowing Chicken Farmers to continue setting allocations based on the new system while it was getting the necessary signatures on its legal document. The council did not give Chicken Farmers a deadline for getting the signatures.

The farm products council oversees national supply managed marketing agencies along with various sectors’ promotion and research agencies.

Janzen says the Farm Products Council “decision came as a result of a complaint filed by Saskatchewan last fall.” The complaint from the Agri-Food Council challenged Chicken Farmers’ authority to continue setting allocations using the new system when it didn’t have all of the provincial chicken boards and supervisory bodies’ signatures on the legal document.  

The Agri-Food Council is an independent organization accountable to the Saskatchewan agriculture minister. It supervises marketing boards and other agencies in the province.

“The Farm Products Council ruled against them and upheld our process,” Janzen said. “I think that was kind of a turning point.”

Under the allocation system, 45 per cent of the growth in the national chicken market is assigned to provinces based on market share, while 55 per cent is assigned based on eight categories, called provincial comparative advantage factors, such as a province’s population growth and income-based gross domestic product growth.

Janzen said, “not all provinces grow at the same rate of speed. But the good news is we’re all growing and we’re enjoying a very robust market.”

In Ontario last year, the provincial chicken board allotted 36.5 million quota units. That’s an average of 31,560 quota units for each of the 1,155 registered chicken premises in the province, according to the Chicken Farmers of Ontario annual report. Farmers can grow 13 kilograms of chicken annually for each unit of quota. BF