by SUSAN MANN
Chicken Farmers of Ontario will decide who will be accepted into the New Chicken Farmers Entrant program early next year, says Michael Edmonds, director of communications and government relations.
Yet to be named is an industry advisory committee that will recommend finalists for board approval to the organization’s new entrant program.
This is the first year the program has been run. The deadline for this year’s applications was Oct. 31.
Announced at its annual meeting in March, the program will enable each farmer interested in getting into the chicken industry to get up to 10,000 units of new entrant quota. The board is giving out a maximum of 20,000 units a year. Producers must buy it from the board on a specific schedule over 15 years.
A unit of quota is the right to produce a certain number of pounds of chicken every eight-week quota period.
The exact number of units that any one applicant will receive depends upon how many entrants Chicken Farmers approves, and the amount of quota the entrants applied for. The marketing board requires all farmers to hold a minimum of 14,000 units of production, so successful applications must, in addition, buy some quota on their own to reach the minimum.
Unlike Dairy Farmers of Ontario, Chicken Farmers doesn’t run a quota exchange for farmers to buy and sell quota. Edmonds says no official figures are published on how much chicken quota costs. “You’d have to negotiate that with someone who already has quota.”
The idea of the program is to bring new farmers into the chicken business, Edmonds says. “There’s a real emphasis on trying to give new farmers a start in an industry that’s obviously looking to recruit strong talent. The idea is to try and bring people in who are not coming from the supply management sectors.”
On its website, Chicken Farmers says priority will be given to applicants who have not previously been associated with any supply managed sector.
About criticisms that high quota costs prohibits farmers from getting into supply managed industries such as chicken, eggs and dairy, Edmonds says a lot of businesses are expensive to get in to and each industry has its own start up costs. “That’s true whether it’s the franchise industry or any other.”
Applicants had to pay a non-refundable $250 fee. Some of the eligibility criteria include: being a Canadian citizen and permanent Ontario resident, having a business plan and the chicken in the program must be produced on a registered and owned premise.
Edmonds says the number of applications received will not be announced until later in December. A recent Chicken Farmers newsletter says during the summer the organization’s staff fielded numerous inquires from people interested in becoming chicken farmers.
According to the Chicken Farmers 2011 annual report, 1,013 licensed farmers hold 33.1 million units of basic quota. They produced 452 million live kilograms of chicken meat valued at $720 million before it left the farm. BF
Comments
The quota for this program should be coming from the pool.The maximum price should be no more than $50 a unit and whenever the quota gets returned or sold the maximum price should also be no more than $50 a unit.
John Van Dyk
But it shouldn't even be near that high. I did a cash flow for a 15000 unit size broiler barn in 1991 when quota was close to $18per unit if I remember correctly. I factored in a new barn. It did cashflow, not by alot, and not enough that I wouldn't have to work off farm to support myself and my father was nervous about possible future free trade implications, so we abandoned the idea. Quota values should have been capped in the 1970's for every kind of quota. Farm size, or the number of allowable units one can own, should have been capped also, and quota should not have been allowed to be used as security becasue it gives them an absolute purchasing power advantage over any other farmer or rural landowner. thanks alot FCC. Just think how much different the face of Ontario agriculture would look today if the government had implemented these changes in the past. If changes like that would have happened the above new entrant program(which is very scary) wouldn't be needed at all. Raube Beuerman, Dublin, ON
Look China is here buy land where ever when ever they can get it. We the people of Canada doesn,t have to worry about SM they will own the big land mass and we don,t need to worry about who is going to let a young guy or gal start up a farm, it will be all gone to feed the billions over there. Let the companies and the goverments keep letting countries in to buy our land and companies so they can move over there for manufactoring and see where we will be in 20 years. They had ownership of milk quota capped years ago and the big guys got in the drivers seat and changed the rules so they can grow as big as they want. The quota is also lop sided where a 1% increase or 2 days per month is aimed at the big guy getting a great jackpot compared to the small guy.
Guy with 400 kg gets to send 800 kg a month extra for 2 days compared to a 40 kg owner gets 80 kg for a month. They put a lottery up for a couple of people to start shipping milk on the low side so the people can say that they are doing a big favour to get some new dairy farmers big deal, try and level the big guys out and let more medium size farmers start up and more farmers and still get a good price for your milk . The same goes for the other SM farmers too many big guys running the show.
i totally agree ....
Sean McGivern
PFO
There's such a huge market for exporting food to China that the Chinese feel they need to buy land overseas to ensure it happens. Yet our dairy and poultry farmers are so unprepared to take advantage of this, or any, opportunity to increase sales, they'd sooner see Canadian agriculture wither on the vine and "sold-down-the-river", rather than ease up on their blind obsession with gouging Canadian consumers.
Stephen Thompson, Clinton ON
Quit the hammering on SM it is making you look like a fool.Do you know I have talked to Bobby Seeber and he said China could make a trade deal with Canada if they wanted to have Canada ship "X" amount of dairy to China and that it can co-exist with SM. Most Countries currently purchase on the world market where they think they will always get the lowest price and probably do.Having a exclusive trade deal with one Country would mean a higher price based on volume and because of the higher cost it has prevented trade deals like this from happening but they will be coming.Get ready.
John Van Dyk
Your defense of supply management makes you not only look like a fool, but a greedy fool. You continually ignore the concerns of, and best interests of, every Canadian except those 15,000, or so, quota owners who can, and do, take unfair advantage of both consumers and other farmers. You don't seem to understand that for everyone who defends supply management on this site, I get about ten people who contact me privately to tell me that I am completely correct, and then some. Support for supply management, even in the farm community, simply isn't there, and what is there, is evaporating quickly. My understanding of basic economics is unchallengeable, my understanding of the harm supply management causes to both consumers and other farmers, is unchallengeable, and my understanding of the greed and lack of consideration for others by supply managed farmers, is also unchallengeable. More to the point, one is never a fool to point out which half of the half-truths coming from those who selfishly defend legislated entitlements, is the false half. Finally, boasting about who you've talked to, is little more than grasping at straws, in exactly the same way that supply management continually tries to make themselves believe that if they spend enough time and effort "re-upholstering the deck chairs" on the supply management Titanic, that the icebergs of economic reality will somehow either melt, or go away. They won't.
Stephen Thopson, Clinton ON
I write the truth,you write only because your angry.There is absolutely no boasting going on,Bobby Seeber was at a general meeting I was at.I do not believe anybody even talks to you, so I have seen at least 100 people support SM on this site .Lets see those 1000 names or are they just people in your head.
John Van Dyk
By the numbers, 90% of the farmers, and 100% of the consumers, in Canada have nothing to lose, and everything to gain, if supply management folds - and that is especially true for non-supply managed farmers under the age of 40. Try listening to one if you can stop boasting about what is important to only 15,000 farmers out of a nation of over 30 million people.
Stephen Thompson, Clinton ON
Please explain your statement "having an exclusive trade deal with one country would mean a higher price based on volume and because of the higher cost it has prevented trade deals like this from happening but they will be coming". So, does that mean that since sm is the reason for the higher cost, and is preventing these deals from happening , sm is on its way out? That is what it sounds like to me. Did you read that statement carefully before you hit the 'send' button? If sm is not on its way out, why would China want to buy dairy from Canada at a "higher price based on volume" when they could buy it elsewhere at real world market prices? It is my understanding, that when something is bought "based on volume" it usually warrants a lower price. Furthermore, if Canada was willing "to make a trade deal", selling dairy to China it would have to be a competitive price, less than what processors or retailers pay here, and how do you think they would feel about that? Do you really think if Mr. Seeber knew if sm was on its way out, that he would tell you? Of course not, in my opinion, he will support it, as most politicians will also, until the end of it. For example, think about it for a minute what would happen if 95% of the politicians across Canada announced that they were unsupportive of sm. Do you think sm farmers would be in a hurry to sell their farms and/or cash in their quota real fast? I do. When it comes to Canada getting trade deals 'done', unfortunately, it was reported on the news about 2 weeks ago that Canada is well behind other countries. Raube Beuerman, Dublin, ON
I find the amount of land being bought in Canada by people not residing in Canada concerning. In my opinion, it is another driver of price increases in farmland that current farmers and/or future farmers(and many other non-farming Canadians) cannot afford. I do agree with Mr. Thompson that China is so concerned about their future supplies that they feel the need to buy land here to ensure it happens, but having said that, I would prefer for Canadians to own the land and sell our products to the rest of the world. I applaud our government for taking notice last week of the Nexan deal and I hope changes will soon follow. Raube Beuerman, Dublin, ON
Do you believe the goverment when they said last deal , what it really meant its the last time we will be imformed about a big takeover by China or another country. As i write this letter you know deals are being made right now on how they can come in under the radar.Look back when they said that trade with China would be great for the manufactoring jobs in Canada to have trade with 1.3 billion people in China alone and they convinced alot of people that it would be tons of new manufactoring jobs in Canada. But here we are how many years later and how many companies have packed up and moved to China,and they said NAFTA would be great for us and the companies started packing up and moving south. Look at the processors that are gone from Canada and we now bring the canned produce from all over the world and nothing or very little is processed here.How can private companies or people compete against country own companies, so if there is a group of farmers that have protection from those country takeover all the more power to them we got to have some industries here ont complete sellout. If all the people look for is cheap food at there table where are we going to get the money to buy it just look at those third world countries that can,t grow their own food or afford to buy any,Canada is looking more like that everyday.
I find your comments curious, Mr. Beuerman.
On one hand you condemn supply management in the current form yet you suggest that Canadian farmers should retain the right to Canadian production and marketing to supply export markets as you are against non-Canadians owning farmland.
Is that not a form of Canadian supply management?
What do you think the dismantling of the CWB was really about?
Dismantling supply management corporations (marketing boards) of which I presume you approved of.
Western farmers were given "marketing freedoms" and "liberties" (Mr. Rtiz's words).
That means Chinese (or others) may produce and move grains to China as our government granted 'marketing freedoms'.
People like you cheered our government on to dismantle domestic marketing corporations but now you would like to reserve production and marketing rights for "Canadian" farmers.
Is it possible that new Chinese farmers would be able to produce and market grains cheaper than present aging farmers? By denying Chinese farmers the right to production in Canada... are you denying everyone the right to cheaper food?....(i.e. milk argument)
And as for the price of land... who are you to say a farmer does NOT have the right to sell his land to the highest bidder? Why would you deny a retiring farmer the right to a decent pension?
Are you being selective in capping the value of commodities? Will you extend your views to the domestic auto industry, clothing, energy, etc?
I understand, China has about $40 Billion to invest in Canadian farmland. That $40 Billion will go a long way towards farmers' pensions and other investments.
Do you support self-interests in agricultural marketing at the expense of foreign marketing as opposed to corporate (marketing boards) marketing Mr. Beuerman?
joann vergeer
Do some people not realize that its not chinese people coming to Canada buying the land , that,s it the China goverment buying the land and companies. There,s alot of differance from immigration and a country takeover.
Mr. Harper's statements recently (correct me if it wrong) concerns investments by foreign state-owned enterprises and it's impact regarding industrial sectors. Trade.
Real estate acquisition is another matter. The feds control trade, the province controls the land.
Quebec has firm rules in regards to non-residents purchasing farmland. The province of Quebec strongly support their farmers.
I don't believe Ontario has those restrictions..... but then..... the province of Ontario is not known for showing much (if any) support for agriculture.
With Mr. McGuinty, it's about money. Nothing more, nothing less.
Do you honestly think Mr. McGuinty will allow a few aging sentimental farmers get in the way of huge foreign investments?
No. If he did, stricter rules to farmland acquisitions would be presently in place.
joann vergeer
In the case of the Nexen deal, could we see the end of what is essentially a free market shift to one that is under control of a foreign government? Could a similar situation happen in agriculture? For more insight on this I suggest googling "mallick: nexen deal proves harper is china's playtoy" and "Jim Stanford:Nexen and Progress takeovers approved: what's next? Raube Beuerman, Dublin, ON
Just think what it would be like if the GOVERNMENT did not capitalize marketing licences in the first place by assessing a value on those licences.
Think of the billions of $$$$$$ the public benefited with quota valuations.
The sins of quota capitalization appears to be on the verge of biting the province of Ontario. One cannot take the benefits without the liability.
Government issued quota for free - the only value ever placed on quota was by farmers. Furthermore quota never provided the public any benefit whatsoever. The only thing quota ever provided the public is extra cost. Just exactly how is being forced to pay almost 38% more than you need to pay for milk, any sort of public, or even private, benefit to any consumer, or group of consumers? Finally, the only people who are on the verge of being bitten by the sins of having capitalized quota, are the greedy sods who bought it, and nobody should, or does, feel sorry for them in the least.
Stephen Thompson, Clinton ON
Shows you what you know.
How sad!
Every word I posted is the undisputable truth, and entirely consistent with basic economic principles - if you can't handle the truth, and are going to be a "flat-earther" when it comes to accepting the truth about basic economic principles, how sad for you.
Stephen Thompson, Clinton ON
Define truth.
With previous (current) benefits derived from government imposed quota capital valuation.....it's the facts that really matter.
(1) The government DID NOT IMPOSE VALUES ON QUOTA.
(2) Quota acquired value only because farmers were willing to pay to buy quota from other farmers.
(3) The only benefits derived from quota having a value, are enjoyed by farmers who want to sell quota - to anyone else, including farmers who want to buy quota, and consumers who suffer at the retail counter because quota imposes artificial shortages, and therefore a higher price, quota is a cost, definitely NOT a benefit. That, Ms. Vergeer, is the truth, whether you agree or not.
Stephen Thompson, Clinton ON
1) yes, the gov't was the first to place an assessed value on marketing rights.
2) no, the farmers protested the gov'ts move to place an assessed value on marketing licences.
3) no, the farmers that were assessed a value on their marking licences subsidized the province of Ontario by paying proportionally more at the municipal level. .......and of course......when the gov't capitalized marketing licences........taxation became another source of revenue.
I am a little surprised at actually how little you know about marketing licences.......but then you can be forgiven as so many actually believe agricultural licences "appeared" in the 1960's.
joann vergeer
John, what your saying doesn't make any sense at all. Quota, has nothing to do with municipal tax levels at all, what are you alking about ? please direct us all to some sources to verify your statements ????
The comments make sense if you understand the history of agricultural production and marketing that was transposed in Upper Canada.
The short answer to your question would be: check with the Ministry of Finance, Assessment Division circa 1961 ( approx. year, my source materials are not readily available) ......today we call it MPAC.
One needs a reasonable understanding of the previous Mill Rate system, an understanding of who controlled production rights and who controlled marketing rights (not privileges), why agricultural marketing rights were attached to land in 1928 and by whom.
The Natural Farm Products Act did not come in existence unto 1936......so it begs the question how did Ontario farmers get permanent marketing rights before OFPMC existed?
Land values hovered around a few hundred $$$$ an acre in the 60's and the Province saw sit to place an assessed value on marketing rights @ approx. 4 times the land value. Effectively capitalizing quota.
Hence, thousands (literally) of farmers subsidized the public via increased municipal taxation.
1997 saw changes in municipal taxation but 2008 was the significant year.
Ask your MP or check the history of MPAC.
joann vergeer
The proof that Mr. Thompson is correct about who put value on quota comes right from Mr. Edmonds where he is quoted, referring to the value of quota-"you would have to negotiate that with someone who already has quota", with, obviously, "someone" being another farmer who owns quota. Enough said? Raube Beuerman, Dublin, ON
WANTED: 2 financially gullable fools. That could be an another appropriate headline to this story. This is a far worse investment than the land that Mr. Van dyk's neighbour cashcroppers purchased for $15-20000 that were able to make the interest payments on. Who in their right mind would spend almost 2 million on quota to make, if I am not mistaken, probably close to $75,000 per year. Put the cost of a barn on top of the 2 mil also. The only conclusion I can come to here is that the CFO does not want any new chicken farmers. I will be baffled if anyone has applied. If I am 'off' on any of my numbers feel free to correct me. Raube Beuerman, Dublin, ON
For all intents and purposes, this new entrant scheme is as dubious as anything ever coming from Pigeon King. As an example of how flaky supply management is, even at the best of times, one of my clients bought a small (15,000 bird) broiler farm in 1999, used the fairly-substantial equity from the sale of his house in town, borrowed money from his father-in-law, borrowed everything he could from FCC, and started farming. Thankfully, he and his wife, both kept their managerial/professional jobs because it's only been in the last year or two, that even though they are top managers, the farm has come anywhere close to breaking even, even with quota prices at the 1999 level. He's always figured that if/when quota collapses, he and his wife will still have their careers, unlike most supply managed farmers who will be driving school buses and gravel trucks, or if not that, will be greeters at Wal-Mart. Most importantly, however, could he do the same thing in late 2012 that he did in late 1999, even with the new entrant program, given the increase in the price of quota during that time period? Do pigs fly?
Stephen Thompson, Clinton ON
I would have to agree with you,even though I am a supporter of supply management I would not suggest to anyone to apply for this program.
John Van Dyk
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