November 30, 1999
(Forest Resources and Agrifoods)

The following statement was issued today by Kevin Aylward, Minister of Forest Resources and Agrifoods. It was also read in the House of Assembly:

The supply management system for eggs in Canada is one of the best that exists today. It is the envy of many producers in other parts of the world. The system ensures consumers of a fresh and healthy product, at reasonable prices, through its high standards and constant inspections. All provinces of Canada and the Northwest Territories are part of the system through federal provincial agreements.

The national system sets the egg production quota in Canada and in turn, it is allocated between the provinces and territories. As is the case for fish, we have to operate within the quota limits that are set for the province. In dealing with eggs, we are imposed a penalty if the province exceeds the quota that was established.

The egg production in Newfoundland and Labrador has a positive impact on the economy, with eggs being produced in all regions of the province and providing much needed employment to the rural areas.

In our province today we have 15 farms producing approximately 6.7 million dozen eggs. The total egg industry is worth $8.5 million. Approximately 28,000 weeks of work are supplied on farms in the province.

With improved production technology and declining population, Newfoundland and Labrador produced more eggs than were required for the market. Our surplus rose to over 30 per cent so our province, under several programs offered by the Canadian Egg Market Agency, reduced the allocation by approximately 100,000 hens. As a result, the Newfoundland and Labrador allocation was reduced to approximately 310,000 layers. Today we are still producing more eggs than is required for our local market and as a result, we ship out approximately two million dozen eggs to plants in Ontario and Quebec. Even though we reduced our production, we are still in a surplus situation.

Traditionally, under the supply market system, eggs move freely between provinces, therefore, some businesses market their product in our province. For example, Farmer John's Eggs from Nova Scotia can be found on our shelves.

Since 1992, 10 quotas have been sold in the province. The present market value for quota is between $25 and $40 per bird, depending if it is strictly quota or quota plus farm assets. When you consider the cost paid by registered producers, or new entrants for quota, anyone who operates outside the system has a very big advantage.

The total levy being paid by our producers to maintain the provincial and national system is 21.4 cents per dozen. This gives an unregulated person a big advantage to compete in the marketplace. Since the price is set by a national cost of production, an unregulated producer can use the system to his or her advantage and price their eggs accordingly.

In 1992, the Newfoundland Egg Marketing Board (NEMB), as did many boards across Canada, reduced unregulated production from 499 to 100 layers per producer. In addition, it is prohibited to house multiple flocks under one roof. A public notice was posted by the egg marketing board. Anyone who could supply proof that they owned up to 499 layers prior to June 1992 had their flock size verified and were grandfathered into the system. The illegal producer of eggs who has recently stated that he was in production many years before 1992, and was aware of the grandfathering clause, never requested to be grandfathered into the system until this past summer.

The egg, like the dairy industry, is important to the province. Each operates under a supply management system, whether it is national or provincial. The systems were developed to stop the price wars and to institute and maintain stability in the industries. The present system gives the producers confidence when investing millions of dollars in their farms that they can expect to repay their debts and make a living for their families.

The Newfoundland Egg Marketing Board is totally funded by the egg producers of Newfoundland and Labrador.

I am pleased to announce in the house today, that officials of my department, in consultation with the industry, have written a new Egg Marketing Scheme and that it will be released in the near future. I am also pleased to announce that I will be appointing a consumer representative to the Egg Marketing Board in the next few weeks.

1999 11 30 4:00 p.m.