Heinz's closure will take away 740 direct, and possibly another 500 indirect jobs. Kellogg's closure is 500 direct jobs, and likely another 500 indirect jobs; for a grand total of 2,240 jobs leaving Ontario's agri-foods sector.
Premier & Ag Minister Wynne announced a few months ago that she wants a doubling of agri-food exports before 2020. Now that Heinz and Kellogg's are leaving us, she is miles behind the starting point she had a few months ago.
Whatever will she do? Here is a suggestion:
As posted on this Blog on Mar. 13, 2013
Why Not Export Canadian Chicken? Canada’s #ChickenMafia has only 1.4% market share of exported chicken for OECD nations; a mere insignificant blip. Canada is in last place, last out of the 7 OECD nations for chicken exports.
Canada is an exporting nation. Canada could export chicken too. Theoretically, Canada could, if we worked hard, gain up to 50% market share for OECD exported chicken. It would take a while to achieve, but if we did this, Canada would need to grow 5 times more chicken than what we do today. That means 5 times more jobs, 5 times bigger markets for Canada’s grains, 5 times the spin-offs for feed mills, farm machinery, etc.
Chicken Farmers of Ontario (“CFO”)
recently announced that Ontario’s #ChickenMafia produce $2.7 Billion per year of economic activity in Ontario. Since Ontario is about 1/3 of all chicken in Canada, we can project that all of Canada has $8.1 Billion of #ChickenMafia impact. Taking this to 5 times current activity for OECD chicken exports, that’s $40.5 Billion for Canada, and Ontario’s share would be 1/3 of that, which would be $13.5 Billion.
Would Premier Wynne be happy to get an additional $10.8 Billion per year (13.5 – 2.7= 10.8) of economic activity and exports for Ontario’s agri-foods sector?
I think so.
There’s only one problem: Supply Management for chicken.
Right now, the #ChickenMafia have 99.97% market share for chicken in Canada, at a price which is 300% higher than the world price, thanks to their Supply Management monopoly. The #ChickenMafia prefer to suck the blood of Canadians at 300% price gouging, rather than the challenges of exporting chicken onto the world market.
If others could get a sweetheart deal like the #ChickenMafia monopoly, they’d likely do the same, so let's not be too quick to blame the #ChickenMafia. It was the government who freely gave them, and continues to support them with this monopoly.
Perhaps we can encourage the #ChickenMafia to come out of their shell, spread their wings, and compete on the international chicken markets, if not for themselves, then as their patriotic duty to help their fellow Canadians [pause until laughter subsides, then continue].
There is just one problem. Nobody else in the world is stupid enough, if given a choice, to pay 300% more for their chicken. Therefore, it's a non-starter for Canada's #ChickenMafia to try exporting chicken at Canadian domestic prices. If the #ChickenMafia wants to export chicken, it will have to be at the world price for chicken.
With WTO (World Trade Organization) rules, #ChickenMafia can’t export chicken for sale at world prices, because that is the definition of “dumping” (ie. selling internationally at prices lower than domestic prices). As soon as Canada’s #ChickenMafia started exporting at world chicken prices, and if they were to gain significant market share, they would soon be slapped with dozens of WTO complaints for dumping, and the trade wars begin.
Darn! Another great idea hits a brick wall. If only we didn’t have 100% commitment to Supply Management and the price gouging that the #ChickenMafia gets to do to Canadians. That extra $10.8 Billion per year of agri-exports from Ontario sure looked appealing.
Oh well, there’s always Ontario Works (ie. welfare, government dole). Let somebody else worry about it. Let the “
Power That Be” come up with a better idea that actually has a hope of being implemented.
What do I know? I’m just an unemployed bum after decades of working at Heinz or Kellogg’s or elsewhere.