Entry program for Ontario egg producers

Friday, April 8, 2011

by SUSAN MANN

Fifty people have applied so far to a new program offered by Egg Farmers of Ontario to help get people into the egg industry.

As part of the New Entrant Egg Quota Loan Pool up to 5,000 units of quota will be available every year. That amount could go to one person or be split among a few people. The quota is loaned for 10 years and then it must be repaid in yearly installments over a five-year period. The program was unveiled at Egg Farmers annual meeting last week.

Harry Pelissero, Egg Farmers general manager, says the board introduced the program because it’s an opportunity “to help new individuals who are interested in the egg business.”

To get access to the 5,000 units of loaned quota, a person has to buy 2,500 units of quota on the open market, Pelissero explains. People buying and selling quota run adds in the egg board newsletter or they can sometimes buy it as part of an ongoing farming operation that’s being sold. For those applying for less than 5,000 units of loaned quota, they must buy one unit of quota for every two units of loaned quota they receive.

Quota for egg production costs $200 to $225 per bird. For someone getting access to the full 5,000 units of loaned quota, they’d have to make an investment of $500,000 for quota, Pelissero says. The program participant doesn’t own the loaned quota.

If a successful applicant gets 5,000 units of quota, it’s repaid at a rate of 1,000 units every year starting in the eleventh year. For those getting less than the 5,000 units, they must repay 20 per cent of whatever amount they borrowed every year starting in the eleventh year until their entire borrowed amount is repaid.

To loan the quota out initially before any has been repaid, the egg board set aside 50,000 units from the last allocation issued by the national organization. The pool is self-perpetuating because once the quota is repaid it gets loaned out again, Pelissero says.

The program is open to anyone except for current or former quota holders in supply-managed industries. To apply, people must complete a one-page application form and pay a non-refundable $100 fee. It’s recommended applicants submit a business plan with their package.

A selection committee recommends the successful applicants while the egg board approves the people who get the quota loans. They must be in production within 18 months of being selected. Applications are due by the end of May, while the successful ones will be picked by September or October, he says.

Currently there are 400 egg and pullet quota holders in Ontario. BF