Tuesday, May 31, 2022

OBHECC public hearing winds up

 A weeks-long set of public hearings wound up here recently, leaving the appeals tribunal to decide whether the cost-of-production formula for hatching eggs and chicks ought to be changed. 


The Association of Ontario Chicken Processors brought expert witnesses to argue that there is double counting in some aspects of the formula the Ontario Broiler Hatching Egg and Chick Commission uses.


Its lawyer, Alexandre Fallon, told the Ontario Farm Products Marketing Commission’s Appeals Tribunal, that flaws in the formula mean chicken processors are paying prices that are too high, mainly for labour and investment.


Lawyer Trenton Johnson countered by citing evidence from its expert witnesses to justify the formula and said no customers have complained – hatcheries which pay the prices set by the formula, chicken producers who buy the chicks and chicken consumers. And he argued that there is no double counting.


He said the only one complaining is the Association of Ontario Chicken Processors which he called a trade association that lobbies on behalf of its members who want to increase their profits. He said the hatcheries, which are the buyers of the chicks, have not complained about the formula, but participated in fashioning and approving it.


Lawyer Geoff Spurr, speaking for the Chicken Farmers of Ontario marketing board, said the processors only want to push chick prices down. He noted that chick costs are about a third of those included in the chicken farmers’ cost-of-production formula.


The AOCP challenges have persisted over four years involving negotiations, hearings at the commission level and now the appeal to the tribunal.


 case. During that time, Johnson said OBHECC consulted with the processors and made some changes, even though it has no obligation under its mandate to consult with the processors.


Spurr said the processors treat the formula as only a way to cover costs, but the real and fair aim is to also provide farmers with earnings on their labour and on their investments. 


The issues raised were technical, leading to lengthy testimony and arguments about data bases and various formulas that have been used, such as the Ontario Energy Board to calculate a fair return on investment.


It may take weeks for the three tribunal members to review the evidence and arguments and reach decisions. It does have the power to substitute its own cost-of-production formula, or parts of it.