LONG TERM PRICING AGREEMENT REACHED

Manitoba Chicken Producers (MCP), Granny’s Poultry Cooperative, and Dunn-Rite Food Products have reached a long term agreement on a pricing formula.  The agreement will be in place until January 20, 2018 (periods A-141 to A-147).

The formula to determine the minimum live price uses a cost of production model (including both fixed and variable costs) and an operating margin.  The price will change each production period based on the Manitoba costs for feed and chicks.  Catching costs will be set annually.  The formula will use the Chicken Farmers of Ontario operating margin, which is updated annually.

A live weight category of  >2.2 – 2.3kg will be used for the base price.  The prices for weight categories outside this range will be calculated from this base price.  The number of  weight categories increases to 10 (previously 4), and the range within each weight category is narrower.

The new prices and weight categories take effect December 25, 2016.  The first price bulletin using the new formula was issued December 16, 2016.