The Canadian chicken industry has moved a major step closer to creating new national rules to control production.
On Oct. 17 in a teleconference call, directors of Chicken Farmers of Canada approved in principle a new allocation plan worked out during months of negotiation.
Chicken marketing boards in all 10 provinces now will work with provincial governments and other involved parties to change the rules within the next two weeks so an agreement can be signed at a meeting in Ottawa Nov. 13-14.
The new system would take effect next April.
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Growth capped
It would limit annual growth in production to five percent across three regions – four western provinces, Eastern Canada and Atlantic Canada.
Within those regions, provinces could negotiate their share of the production increase.
In addition, an extra 1.5 percent in production could be given to a region where there is demand.
John Kolk, CFC chair, has said that with its competitive advantage in feed costs and growing demand, the extra quota likely will reside mainly in the Prairies.
He said production levels will continue to be set based on processor demand. However, the tighter limits should keep production surpluses in control and result in more stable prices.
Since the chicken industry ended the cost-of-production pricing system and gave processors more say in setting production levels several years ago, the system has been struggling to deal with complaints from some provinces about over-production elsewhere and from producers about volatile prices often below production costs.
Quebec had threatened to pull out of the national system unless it was reformed.
