In testimony during a tribunal hearing in Guelph this week,
the difference between renting and owning egg quota was outlined during
questioning by lawyer Herman Turkstra.
Under the current Egg Farmers of Ontario leasing program, it
charges $7.30 per hen per year. Of that, $5.85 goes to the national agency and
the board uses the rest to hold down levy charges to underwrite it’s
administration budget.
If the production increase were achieved instead by
increasing farmers’ quotas, they could either use the quota or sell it at the
going market rate of almost $300 per hen.
Selling would yield a windfall of $397,800 if each quota
holder got the same volume he could currently achieve under the board’s leasing
policy.
That, as Turkstra outlined, is 6,630 for a quota holder
whose barns are now full, but who decides that in order to qualify for the
leasing volume, would split his quota and move some to another property he
owns.
He now qualifies to lease 6,630 hens per premises, a total of 13,260 hens.
The board used to increase or decrease quotas to balance
supply and demand. In 2010, it began allowing farmers whose barns were full to
lend their excess quota to the marketing board which then, in turn, leased
those birds to farmers who had enough space to house the extra hens.
In 2013, the board decided to lease all of its additional
production rights (gained from the national agency) rather than distributing
them as additional quota.
It also decided to give every quota holder the same number
of additional hens – provided they had barn space to house them – rather than a
percentage increase based on the amount of quota they each own.
