At a Chicken Farmers of Canada meeting Tuesday, national allocation for quota period A-165 (Aug. 30 to Oct. 24, 2020) was set at minus two per cent from its adjusted base. That translates to a total allocated chicken volume of 188,169,106 kg (eviscerated), nationally, for the period.

Since the onset of the COVID-19 pandemic, CFC and its provincial counterparts have been grappling with reduced processing capacity and volatile consumer demand, including spikes due to retail panic buying and drop-offs from the near-closure of Canada’s restaurant and foodservice sectors.

The relatively small cut announced Tuesday follows adjustments in April of minus 13 per cent nationally for periods A-163 (May 10 to July 4) and A-164 (July 5 to Aug. 29) from the base for those periods, so as to “reduce production and address the concerns of our value chain partners,” CFC said.

The cut for A-164 was then revised upward slightly in May, to minus 12 per cent, based on what CFC described as “a slight increase of demand by foodservice, as some companies begin the reopening process.”

After an “initial surge” in the wake of the COVID-related isolation measures set up across Canada in March, demand for chicken weakened, Chicken Farmers of Ontario said Tuesday in a separate release.

Now, however, consumer demand “appears to have rebounded to a great extent, albeit at different rates for different product types and consumer channels,” CFO said.

CFO said its latest recommendation “was framed on a public policy of ‘balanced best interest’ upon weighing the various factors, perspectives and dynamics resulting from the pandemic.”

Volume allocation for quota period A-166 (Oct. 25 to Dec. 19) is expected to be set at CFC’s board meeting next month, CFO said. — Glacier FarmMedia Network

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CFC chair Benoît Fontaine warned federal MPs as much during a virtual meeting of the Commons standing committee on agriculture and agri-food on May 29.

Farmers and processors were left with a surplus in production for a short period of time at the onset of the COVID-19 crisis, he said, but the supply-managed industry was able to quickly change its production levels to avoid a “worst case scenario” that would have resulted in the depopulation of flocks.

The industry dropped its allocations from May to July by 12.6 per cent, and plan to reduce production by 11 per cent throughout July and into early August.

“This choice was done under our own initiative in order to act responsibly and satisfy Canadian demand without too many surpluses,” Fontaine said in French, noting processing plants have reduced volumes to make way for physical distancing measures while combating absenteeism and some temporary plant closures.

Fontaine raised concern over the value of flocks not being covered under current federal financial backstops. Most government-funded programs only offer support to the industry when there is a major depopulation of flocks, he said, but only to help cover the costs of euthanasia and not the overall value of the flock.

Jean-Michel Laurin, CEO of the Canadian Poultry and Egg Processors Council, said continuing to operate has had “significant financial impact on our sector.”

More than $87 million was spent in March and April on mitigating the impact of COVID-19 within member facilities, while at the same time having to adapt to market disruptions, he said.

“Because of the severe market correction, in poultry specifically, wholesale prices have dropped significantly since the beginning of the crisis,” he said. “What we want to stress is that this perfect storm creates vulnerabilities within our supply chain.”

While a fund of $77.5 million has been created by the federal government to help processors mitigate the impacts of the pandemic within their facilities, that money is not easily accessible because of certain eligibility requirements, according to testimony at the committee.

Concerns continue to be raised that money won’t be close to enough for Canadian agri-food processors.

“We can’t ask for reimbursement on disposable masks; it has to be reusable masks, and that will add to the costs,” council chair Joel Cormier said, noting his workers require disposable masks. “We’re trying to protect workers here, masks are absolutely needed. Washable ones are not good enough in this sector.”

Laurin said many companies began installing protective devices in February, prior to when federal assistance dollars were available to do so.

“We’d like to ensure that there could be reimbursement or compensation retroactive to things done before (the federal dollars were made available),” he said.

Like others in the processing industry, Cormier raised concern over not qualifying for certain wage supplements being made available by Ottawa.

“Right now, we are not eligible to the salary supplements, the wage supplements, because the thresholds, whether it’s eggs or poultry, our production is pretty steady, but demand has dropped like crazy,” he said, noting they couldn’t drop production in time to be eligible for the supplement.

During his testimony at the same meeting, Rory McAlpine, senior vice-president of Maple Leaf Foods, called for a forensic look at food systems to be completed by an independent body after the pandemic.

“There needs to be at least one inclusive, evidence-based post mortem or lessons learned,” he said, adding federal and provincial officials should be instructed to participate fully in such a study.

Such a report, he suggested, needs to ask why Canada did not have a cross-agency business continuity plan for food in place prior to the pandemic.

Meetings of the committee will continue to take place regularly until Sept. 21.

— D.C. Fraser reports for Glacier FarmMedia from Ottawa.

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Chicken Farmers of Canada announced Thursday it has a new federal-provincial agreement (FPA) in hand, including a new quota allocation methodology.

The new deal was concluded Tuesday, CFC said, when the Farm Products Council of Canada ruled the new FPA can proceed without first getting Governor-in-Council approval — that is, approval from the federal cabinet via the Governor General.

The national Farm Products Council had said in its 2015-16 annual report that it would be required to review any amendments to the operating agreement of a new FPA, to see whether they would have to have Governor-in-Council approval.

Thursday’s announcement, CFC said, “brings to close more than eight years of discussions and negotiations” toward a new allocation system.

Alberta Chicken Producers had pulled out of the FPA in 2013, but continued to work with the national producer body on updating allocation, CFC said.

“We’re excited to have all our provinces back on board,” CFC chair Benoit Fontaine said in a release Thursday.

Alberta had stepped out of the CFC system in 2013 “because our population was growing at such a greater rate than the rest of the country and our piece of the pie was getting smaller and smaller and smaller — and we didn’t think that was fair,” Alberta Chicken Producers chair Erna Ference told Alberta Farmer in 2014.

The Alberta body had estimated its producers were only getting 80 per cent of what their allocation should have been.

Alberta and the other nine provincial chicken-marketing boards in 2014 signed a memorandum of understanding which would see allocations for each of the eight-week rolling production periods partially based on factors reflecting provinces’ comparative advantage.

Officials at that time said the national chicken farmer body was working under threat from the Farm Products Council that CFC’s allocation requests would not get council approval unless a new national deal could be reached.

“The fact that we were standing on the edge of the precipice had us saying, how much is supply management worth to us?” Jake Wiebe, chair of Manitoba Chicken Producers, said in Alberta Farmer in 2014.

Alberta, according to the national Farm Products Council, had “signaled its intent” in 2014 to rejoin the FPA once the memorandum of understanding got unanimous support from the CFC board. — AGCanada.com Network

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Chicken Farmers of Canada (CFC) on Tuesday announced that, following the “successful elimination” of Category I antibiotics for disease prevention in chickens, its antimicrobial use strategy will next focus on eliminating preventive use of Category II antimicrobials in chicken production by the end of next year.

Where Category I antimicrobials are considered of “very high importance” in human medicine — products essential to treat serious bacterial infections, with limited or no available alternatives if drug-resistant strains develop, Category II is considered of “high importance.”

As per Health Canada’s definition, Category II drugs — such as penicillins, quinolones and first- and second-generation cephalosporins, among others — can be used to treat a variety of infections, serious or otherwise, and alternatives are “generally available.”

CFC’s strategy also now sets a goal to eliminate preventive use of Category III antibiotics, those of “medium importance,” by the end of 2020.

Category III drugs — such as tetracyclines and bacitracins, among others — are used to treat bacterial infections for which alternatives are generally available, and if bacteria develop resistance they can generally be handled by Category I or II drugs.

CFC said its policy will maintain the use of ionophores, along with antibiotics for therapeutic purposes — that is, for the purpose of treating infected birds. Ionophores today are in Health Canada’s Category IV, “low importance” drugs not now used in human medicine.

“This strategy provides a sustainable means of meeting consumer expectations, while maintaining the ability for farmers to protect the health and wellbeing of their birds,” Chicken Farmers chair Benoit Fontaine said in a release.

Consumers, CFC said, “can be assured that Canadian chicken is free of antibiotic residues, and has been for decades.”

Canada has strict regulations with respect to antibiotic use and withdrawal times, monitored by the Canadian Food Inspection Agency, to ensure chicken reaching the marketplace doesn’t contain residues, CFC said.

CFC said its latest decision “builds on the objective of eliminating the preventative use of antibiotics of human importance.” — AGCanada.com Network

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The federal government said Friday it plans to launch consultations with “industry stakeholders” over potential changes to its Duties Relief Program (DRP) and Import for Re-Export Program.

It’s hoped such changes will “address the concerns of import predictability and effective border controls for supply-managed commodities,” the government said, while making sure Canadian processors using dairy and poultry ingredients can “remain competitive in export markets.”

The DRP, for example, is meant to allow eligible companies to import goods without paying duties — as long as said goods are later exported. The Import for Re-Export Program is meant specifically for dairy, poultry and egg products, which in Canada are supply-managed.

The Canada Border Services Agency earlier this year found five participants in the DRP were “improperly” selling supply-managed commodities in the Canadian market without reporting the sales or paying required duties, the government said.

Those importers’ DRP licenses were suspended, the government said, and the companies were slapped with “applicable duties, interest and penalties.”

The government said Friday it will also consider measures for dairy and poultry users of the DRP regarding inventory reporting, so as to “improve the predictability of these imports.”

In the poultry sector, the government said it would work to “ensure appropriate tariff classification” of spent fowl — meat from layer hens that no longer lay eggs — by looking at “specific” options for certification of those imports.

Because spent fowl meat can be imported duty-free, some importers are suspected to have been declaring broiler chicken meat as spent fowl meat, the government said.

“Our farmers and processors have been afflicted by leakages in the market that have been occurring for many years now, meaning they face uncertainty in their own production, and consumers face uncertainty in the safety of their food,” Dave Janzen, chair of Chicken Farmers of Canada, said Friday in a separate release.

Addressing these issues won’t affect the “significant” amount of legal imports of chicken, CFC said, noting Canada today is the 13th-largest importer of chicken in the world.

Officials are also “assessing the feasibility” of DNA tests to screen imports of spent fowl at the border, the government said.

That assessment would look at the test’s cost and the “operational feasibility” of the test’s use in the field. It would also involve “scientific validation” of the test, working with other federal departments, industry stakeholders and Trent University.

CFC on Friday pointed to several holes it would like to see plugged in the Duties Relief Program, including marinated products, which were banned from the Import to Re-export Program due to concerns over the “possible diversion to the domestic market” but are permitted under the DRP.

Participants have up to four years to re-export the chicken they’ve imported, CFC said, and imported products could illicitly be substituted with “lower-value cuts, and even spent fowl.”

CFC said the DRP essentially “duplicates” the Import to Re-export Program, which was created specifically for agricultural goods and has in place “adequate verification and safeguard processes.”

The previous Conservative federal government pledged in October last year to exclude any dairy, poultry and egg tariff lines subject to tariff rate quotas (TRQs) from the DRP, the chicken producer group said.

“Canada’s government must move quickly to enact this change and ensure that no further damage occurs from the misuse of the Duties Relief Program.” — AGCanada.com Network

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And Canada’s chicken producer group says the Canadian chain’s move dovetails with a direction the Canadian industry was headed already.

“McDonald’s believes antibiotics have important benefits, but that a few sensible changes to our policy can both maintain their most important benefits while helping to reduce their use overall,” Rob Dick, senior supply chain director for McDonald’s Canada, said in a release Monday.

To that end, the company said, the Canadian farmers who supply chicken to the chain “will continue to responsibly use ionophores, a type of antibiotic not used for humans that helps keep chickens healthy.”

The chicken served at the 1,400-plus McDonald’s restaurants in Canada, in both its chicken sandwiches and its McNuggets, all comes from Canadian poultry farms, the company said.

McDonald’s Canada said Monday it plans to “work closely with industry to implement the new antibiotics policy in its chicken supply chain within the next three years.”

Chicken Farmers of Canada said the company’s move “plays a role in advancing Canada’s ongoing, long-term Antimicrobial Use (AMU) strategy.”

“Antimicrobial reduction continues to be a concern for farmers, consumers, and public health experts,” CFC chair Dave Janzen said in a separate release.

“Ultimately, the goal of the AMU strategy is to ensure the continued effectiveness of antibiotics while providing continued confidence to consumers.”

Category I antibiotics, those considered “most important to human health,” have been blocked from preventive use in the Canadian chicken sector since mid-May 2014 as part of the industry’s AMU strategy, the CFC said.

The AMU strategy, CFC said, also includes analyzing antimicrobial resistance, reviewing best management practices, ensuring effective controls on AMU in Canada, educating stakeholders and researching and sourcing alternative products.

When introducing the U.S. chain’s new policy in March, Marion Gross, senior vice-president for the company’s North America supply chain, emphasized McDonald’s “believes that any animals that become ill deserve appropriate veterinary care.”

Suppliers, Gross said, in March, “will continue to treat poultry with prescribed antibiotics, and then they will no longer be included in our food supply.” U.S. suppliers would also continue to responsibly use ionophores, the company added.

McDonald’s said Monday the move in Canada is one of several meant to “better meet the changing preferences and expectations of its guests.”

The Canadian chain said last month it would transition to Canadian cage-free eggs over the next 10 years. The company is also one of the founders of the Canadian Roundtable for Sustainable Beef, through which the company aims to help develop sources for “verified sustainable” beef in Canada. — AGCanada.com Network

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The U.S. chain announced Wednesday it would move, over the next two years, to only purchase chicken “raised without antibiotics that are important to human medicine.”

The new policy, when fully implemented, is expected to prevent McDonald’s U.S. chicken suppliers from delivering birds treated with fifth-or-newer-generation cephalosporins, third-or-newer-generation tetracyclines, lipopeptides, oxazolidinones, glycopeptides, carbapenems and/or antivirals.

The U.S. policy would not prevent the chain’s supplier farmers from using ionophores, a type of antibiotic not used in human health care.

McDonald’s Canada, in a statement Wednesday, said it “recognizes the leadership of our U.S. colleagues but has made no decision at this time to change our current approach with chicken.”

The Canadian chain said it “will continue to be engaged with our suppliers, subject matter experts, regulators and industry on plans for addressing” the global company’s goals.

But the Canadian chain said it would also have to evaluate the “implications” of such a move in Canada, given that Canada’s sourcing practices and supply-managed supply chain “are different to those in the U.S.”

The Canadian office said it “will actively work with all our key stakeholders to identify the best path forward, while continuing to follow Health Canada regulations and working within the Canadian supply management system.”

Mandatory

That said, Chicken Farmers of Canada already has a policy in place halting preventive use of “Category I” antibiotics — those considered to be of the “highest importance” in treating serious infections in people — as of May 15 last year.

According to CFC, Category I antibiotics, such as cephalosporins, were until last May used at times at the hatchery level to help prevent E. coli infections and first-week mortality in chicks.

CFC’s policy affects the pre-emptive use of products such as Excenel and Baytril but does not impact therapeutic use of Category I drugs for disease treatment.

The policy is a “mandatory” element of CFC’s On-Farm Food Safety Assurance Program and is enforced in all 10 provinces.

Marion Gross, McDonald’s senior vice-president for its North American supply chain, said in the company’s U.S. release that it “believes that any animals that become ill deserve appropriate veterinary care and our suppliers will continue to treat poultry with prescribed antibiotics.”

But treated birds, Gross said, would “no longer be included in our food supply.” — AGCanada.com Network

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