Thursday, March 10, 2016

Ontario chicken production lagging

Ontario chicken production lagging

Even though Ontario won a decades-long battle to gain more chicken production, production actually lagged the national increase for January.

The national increase was 3.5 per cent. Ontario production increased by 2.3 per cent.

Under the new deal negotiated last year, Ontario is supposed to get a larger share of production increases than other provinces where demand has been less keen.

Ontario is so short of chicken that what’s produced is rationed among processors so they don’t get involved in bidding wars that drive prices above what can be justified by supply-management pricing formulas.

Under those pricing policies, which include an order from the Ontario Farm Products Marketing Commission to reduce prices to reflect volume-related efficiencies, the Ontario price came down by two cents a kilogram for liveweight birds.

That has British Columbia producers complaining that if things keep trending this way, they will soon be losing money. The B.C. marketing board follows the Ontario board in setting minimum prices processors must pay farmers.

Despite the Canadian production increases, imports increased by 7.8 per cent and inventories of frozen chicken declined.

It means that Canadians are eating more chicken, continuing a long-term trend.