Monday, June 24, 2013

Soybean Price vs. Chicken Feed Price

Why is chicken feed price inflation

I talked about soybean prices, and compared then to live chicken farm gate prices in Canada and USA here.

I talked about Canadian feed industry and the growing concentration and market shares here, the major players in that feed market, and the price gouging they are imposing on Canadians disclosed here.

I showed here that there appears to be a chicken feed price conspiracy, where chicken feed has gone up 60% between 2002 and 2012, while cat & dog food has only gone up by 20% in the same time period, even though they use similar ingredients.

Soybean meal (48% protein) is one of the primary ingredients in all of these feeds.  Here is data from AAFC (Agriculture & Agri-Foods Canada) on Canadian soybean meal prices taken from advertised bulk prices.

We can see some market fluctuations, as occur naturally in a competitive market with supply & demand and new/old crop competition.  For the period between 1993 and 2013 (Year-to-Date), we have an average price increase of 1.99%/yr.

From 2002 to 2013, Canadian chicken feed prices rose 4.37%/yr on average.  Chicken feed increased at 219.6% higher than the major feed ingredient; soybean meal.

I wonder why?

Perhaps all of this can be easily explained by huge pay increases for the feed mill staff.  Assuming that soybean meal is the main variable cost which is 60% of the total cost, and fix costs are 10% of the total cost which is inflated at Cost of Living of 3%/yr on average, and employee wages are 30% of the total cost to make chicken feed, then annual raises of 9.59%/yr for feed mill employees who make chicken feed would explain this discrepancy.

If someone who works in a Canadian feed mill that makes chicken feed can contact us to confirm if they have been receiving 9.59%/yr pay raises, it would be most appreciated.

If the above theory of massive, continuous pay raises in chicken feed industry is all wet, then we can only explain this discrepancy as a conspiracy to defraud the Canadian public.

In that case, this latest data appears to be collaboration of my previous post that there is a dirty conspiracy going on upstream, within, and downstream of the Canadian chicken Supply Management system.

Assuming no massive pay raises, this fraud perpetrated on the Canadian public is costing Canadian consumers Billions of dollars every year. It is also weakening our entire Canadian economy.

What we need now, more than ever before in the history of Canada, is a strong, stable economy.

If the government chooses to be willfully blind and paralyzed to this fraud on hard working Canadians, then I suggest that the government is an accessory after the fact to this criminal chronic fraud for aiding and abetting the fraud,  The government is therefore a co-conspirator with all those who are directly involved in the fraud.

Are there any Crown Attorneys, Ministers, government bureaucrats, police, or citizens who are brave enough, frustrated enough, and intrigued enough to investigate further?

Is there anybody out there who is willing to help stop the carnage, and start the healing process?  

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