Monday, December 18, 2017

Chicken production sets record

Canada’s chicken farmers broke the monthly record for chicken production in October, up by four per cent from September and by 8.5 per cent from the same month last year.

And it was all promptly consumed as storage stocks declined by 1.8 per cent.

Some of the change for farmers came because imports declined by 9.4 per cent from the same month last year.

That has happened because exporters are no longer able to cheat by calling broiler meat “spent fowl”. The Canadian government is now able to perform a DNA test on imports to determine whether they are from egg-laying or meat-producing strains of chicken.

The national supply management agency, Chicken Farmers of Canada, complained for years about the imports which grew to volumes greater than total U.S. production of spent fowl, but it wasn’t until they furnished the government with the DNA testing technology that the imports were finally disciplined.

Ontario farmers are benefitting more than most; their production increased by 11.5 per cent in October. That reflects a new national agreement, hard won by Ontario, to recognize that the Ontario market has been chronically short of supplies for its market.

Now when the agency decides to increase production, Ontario is granted a bigger slice of that increase than its pro rata share of the national base production quota.

Ontario has used some of that increase to open the door to small-scale producers to raise chicken without quota and to serve niche markets. It has also opened its chicken-rationing system for processors for the entry of newcomers, also to serve new and niche markets.

One wonders whether the Chicken Farmers of Ontario marketing board will now gain enough courage to scrap its supply-allocation system for processors, to scrap a ban on trading live chicken between Ontario and Quebec, and allow competition to determine which processors will prosper and which will falter.

The agency continues to forecast increased market demand, so it has increased allocations for the next three six-week production periods by 5.24, by 4.75 and by 7.77 per cent. That extends to June 6.

Wholesale prices have increased – by 4.3 per cent for the composite-bird measurement, but by 9.3 per cent for breast meat.

So far this year, chicken has been priced at retail 1.4 per cent higher than last year, beef 2.6 per cent lower and pork 1.3 per cent lower.