Chicken Farmers of Canada is closely monitoring developments related to COVID-19 and its impacts on Canada. The Board of Directors meets regularly to discuss COVID-19 and how we can maintain an adequate supply in this situation.
Throughout this crisis, the sector has been taking the necessary steps to ensure that the entire value chain operates effectively and keeps supply lines moving to consumers.
Issues Related to Supply
The industry has been affected by a decrease in foodservice business and the rapid increase in demand for more retail product. Foodservice represents roughly 40% of our production.
As the COVID-19 issues evolve, some processors need to adjust to the decrease in foodservice demand, and within their own operations, some have had to reduce processing lines, and, in some cases, shut down for periods of time, in order to ensure that they are following government guidelines and regulations regarding COVID-19.
What are we doing?
Throughout this time, the entire Canadian chicken sector has been working to determine how to adjust production levels at the farm to respond to reductions in the ability to process our chickens.
In mid-April, the Chicken Farmers of Canada Board of Directors voted to adjust the allocation for period A-163 (May 10 – July 4) to reduce production and address the concerns of our value chain partners. The result is a production reduction of close to 13% compared to the domestic allocation that was agreed to in early February and represents a 9% decrease from production during the same weeks last year.
At the end of April, the Board of Directors also voted to reduce the period A-164 (July 5 – August 29) allocation by 13% nationally compared to the domestic allocation that was decided in February.
Then, in May, a review was conducted and the A-164 domestic allocation was revised slightly upward. The revised allocation is 12% lower than what was decided in early February and is 10% below production in the equivalent weeks of 2019. This is due to a slight increase of demand by foodservice, as some companies begin the reopening process.
It is important to note that there is no current issue with supply at the retail level, and that consumer demand for chicken remains high. In fact, in the first nine weeks of the COVID-19 lockdowns, over 80% of consumers consistently indicated that they had consumed chicken in the past week and the same number intended to buy chicken the following week. Moreover, consumers indicated that they planned to eat the same amount of chicken in the coming months.
A Testament to Supply Management
We are fortunate in that our supply management system allows our sector the flexibility to adjust production according to both consumer demand and to the capacities of our value chain partners. This serves as one of the major advantages of supply management.
