by SUSAN MANN
The association representing Canada’s restaurants has asked Premier Kathleen Wynne to bring accountability and transparency to Ontario’s chicken pricing system.
In an open letter dated Dec. 16 and sent to the premier, James Rilett, vice president, Ontario for Restaurants Canada, says it’s “unacceptable” that Chicken Farmers of Ontario hasn’t made public its current pricing formula. It’s also unacceptable that chicken farmers, who have the greatest stake in the setting of chicken prices, “should be in charge of the price-setting program.”
Michael Edmonds, Chicken Farmers of Ontario communications and government relations director, says by email the organization “will not be commenting on the letter at this time.”
A spokesperson for Premier Wynne couldn’t be reached for comment.
Ontario Agriculture, Food and Rural Affairs Minister Jeff Leal says by email supplied by his press adviser that Ontario is “firmly on the side of our farmers and the supply management system.”
The provincial government remains “committed to maintaining the supply management system protecting Ontario producers, processors and consumers and creating jobs and economic growth across the province,” he notes.
Earlier this fall the Ontario Farm Products Marketing Commission posted a proposal on Ontario’s Regulatory Registry to change the method used to determine minimum live chicken prices. The current method to determine the minimum live prices farmers are paid has been in place since 2002. Comments were due by Nov. 6.
Rick Hall, Restaurants Canada federal policy director, says farmers have been given three years to come up with a new system and it’s still not done. Hall says their letter included a request that the premier direct the commission to release the information about the current pricing formula and the new replacement formula.
The association also asked the premier to ensure an independent third party with no affiliation to the chicken industry is appointed to swiftly complete the pricing review. Interested stakeholders, such as Chicken Farmers of Ontario, the restaurant association and others “can then play a useful role as interveners before the established open forum of discussion and debate,” the association’s letter says.
The restaurant association wanted to comment on the new pricing proposal but first asked in October that the commission provide it with information on how the current cost of production formula works and for a copy of the proposed amendments along with proposed prices and costs. It also tried to get that information through a freedom of information request. The association didn’t get the information it said it needed to provide comments and missed the deadline, Rilett says. “They wanted us to comment on the cost of production formula without seeing the cost of production formula.”
Despite that the restaurant association has been highly critical of dairy supply management in the past, Rilett and Hall say the way the Canadian Dairy Commission annually researches and publicizes the pricing formula for dairy can be used as a model for the chicken price setting system. The dairy commission also consults with stakeholders, such as the restaurant association, on the pricing formula.
In addition, the dairy commission has independent, third-party firms audit dairy farmers about their current and projected input costs for the upcoming year “as a way of arriving at a figure that the commission uses” and also provides as background during its consultations, Hall says.
In requesting that the current chicken cost of production formula in Ontario be released immediately, Rilett says “we know it exists so there’s no reason it can’t come out.”
And “we want to ensure any revisions to the existing formula are conducted openly. We just want to see how this is done and the public should be able to know that as well.” BF
Comments
Chicken Farmers of Ontario ("CFO") currently uses biased and self-serving data to justify inflated chicken prices that Ontario consumers are forced to pay.
Objective facts to support these statements can be easily found on our Blog http://canadiansmallflockers.blogspot.ca
Previously, CFO knew, or ought to have known, that the inflated FCR (Feed Conversion Ratio) they used was wrongly inflated by 16.3% for a 10 year period. A correct FCR should have fairly adjusted the price of live chickens to the dynamic changes in chicken feed prices.
Many of Ontario's SM chicken farms, chick hatcheries and chicken feed mills are owned or strongly influenced by the same corporate owners and/or their "friends". Over the last 50 years of SM, they have learned how to adjust transfer pricing of live chicken, chicks, and feed so they maximize their profits, sending Ontario consumers the bill for their higher profits through collusion.
Obviously, this is not proper free market price discovery in a competitive market, so it inflates SM profits. This biased system results in chicken and egg farmers under SM being the highest paid farmers in Canada, 21% higher than the median farm income, and 38% higher than hard working dairy farmers.
Now, CFO is proposing a secret, more convoluted & complicated pricing formula, which will likely make it even more opaque, allowing CFO and their millionaire members to price gouge even more with impunity.
CFO was ordered three years ago by the government supervising Commission (OFPMC) to develop a better system. In the interim, they have been delaying, diddling, and colluding, rather than doing what's in the best interest of Ontario citizens.
It seems hopeless to expect CFO to do what is right, as this will reduce the financial proceeds for these multi-millionaires who want to become billionaires.
Glenn Black
Small Flock Poultry Farmers of Canada
Just what inflated chicken prices are you talking about ?? do you actually ever get to a grocery store or restaurant ?
Retail chicken prices have been well below the 2-3% Canadian inflation rate and steady for a number of years.As we all know,that is certainly not the case with red meat.
Your numbers need checked...and inflated is the correct word to use for chicken.
The feed conversion ratios were out of whack by 16% for ten years or something like that...if that isn't inflated, then I don't know what is
Although I do not watch The Exchange with Amanda Lang very often since O'leary's departure, I did happen to catch it tonite.
Ian Lee was a guest speaker to discuss the TPP, and if you are able to catch this episode either online (CBC player) or in the morning it will be on at 6 am.
Raube Beuerman
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