From the Editor: Providing stability in times of crisis
By Brett Ruffell
Features Marketing BoardsOver the course of the pandemic, supply management has shone as a source of stability.
Thus far over the course of the pandemic, supply management has shone as a source of stability. One needs only to look at what’s happening stateside to appreciate the value of the system.
For instance, as panic-buying American consumers flocked to grocery stores to stock up on food during the early lockdown days, the wholesale price of eggs rose 180 per cent and the price of a dozen tripled in many parts of the country.
This has led to two lawsuits thus far accusing producers of price gouging. The Texas attorney general and a group of private individuals in California filed suit separately in late April against the largest egg producer in the U.S. for what they call excessive, unfair, illegal profits during the coronavirus pandemic.
What’s more, U.S. poultry and egg producers have, sadly, had to cull thousands of livestock due to the pandemic. In one situation, for instance, two million broilers on several farms in Delaware and Maryland were depopulated due to a lack of employees at chicken processing plants.
In Canada’s broiler industry, however, there were no depopulations at the time of going to print. This despite the fact that many of our foodservice companies have shut down and staff at our chicken processing plants have been similarity affected by the virus.
“We’re fortunate so far that, with any plant closures, we’ve been able to redirect birds to other plants regionally,” says Lisa Bishop-Spencer, director of brand and communications with Chicken Farmers of Canada (CFC). “We’re lucky that we have the system we have, which allows us to decide, as a whole sector, how much chicken will be produced.”
In April, chicken farmers leveraged the system again to adjust to demand. At a spring meeting, CFC’s board of directors voted to adjust its upcoming allocation (from May to July) to reduce production in order to address the concerns of its value chain partners. This means a production reduction of 12.6 per cent.
“We will evaluate as the situation with COVID-19 unfolds,” Bishop-Spencer says.
Notably, this move did affect hatcheries, who had to cull millions of incubating eggs to try to prevent even more waste later on.
Egg farmers have, to date, kept quota the same. Like chicken producers, they credit supply management for aiding their pandemic response. “Our ability to keep eggs moving in these very challenging circumstances is yet another example of the importance and value of supply management,” says Roger Pelissero, chair of Egg Farmers of Canada. “It delivers stability to our farms, it strengthens our industry – and most of all it provides food security to our communities.”
University of Waterloo professor Bruce Muirhead, an expert in trade negotiations and agriculture policy, says Canada is lucky supply management survived recent trade talks given the widespread shortages and skyrocketing prices stateside.
“If we’d gotten rid of it in the renegotiation of NAFTA, we’d be suffering the effects right now,” he says, pointing to research showing Canada used to import 30 to 40 per cent of its egg requirements before the system.
“We wouldn’t have eggs or you’d be paying $10 per dozen. The country is far better off with supply management than without it.”
Muirhead suspects that, after this tumultuous period, other countries might adopt systems similar to supply management. “I can imagine lots of other countries would begin to consider this arrangement where you guarantee a market for producers and they come through with a steady supply that doesn’t yo-yo all over the place.”
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