The following text may have been generated by Optical Character Recognition, with varying degrees of accuracy. Reader beware!

Recently the largest newspaper Canada The Toronto Star ran the following headline You Pay 200 Too Much For Eggs Shoppers Told The story then wont on to report the results of a lust published study by tho Economic Research Council of Canada The Coat of Canada s Egg System To the right of this page you will find the results of this Council study Spurred on by this and a similar studies dealing with Canadian egg prices began an intensive for a new idoa to reduce egg costs to the Ontario consumer We found that idea in the existence of surplus eggs are sold to egg breakers at significantly lower prices than those which are made available to tho consumer as tablo eggs Surplus eggs wore discussed at length by Food Prices Review Board Report on Egg Prices issued In January 1974 Surplus in both are breaker market a prices lower than those prevailing for table eggs When compared the prevailing prices in the provinces for the corresponding of 1973 the between breaker pnco and table pnces in each case appear to bo substantial one surplus intervention pncesat all if these prevailing prices i for eggs were lower NoName eggs are surplus that havo boon sold to egg breakers at prices that are significantly tower than table eggs Traditionally these eggs sold to restaurants and other institutional users In a form that may bo stored up to a year without adversely affecting he taste of the eggs Loblaws new NoNamo eggs are the first that the Ontario consumer has been given to directly participate in the swings available through surplus eggs whole Pasteurized whole frozen I j- pasteurized with this coupon and any purchase Offer expires June 1979 or while supplies last Highlights of The Cost of Canadas Egg System May 1979 Reprinted in the public interest with the permission of the Agricultural Economics Research Council of Canada 1 Results a detailed study just completed by the Agricultural Economics Research Council of Canada ent tied The Cost of he Canadian Egg System indicates that Canadian consumers are paying at least 9 cents too much lor a dozen eggs Given the deep public concern in Canada f price this unnecessary 35 million annual burden on Canadian consumers should be addressed with tho utmost expediency by all parties concerned Since Canadian government insltuted national supply management policies lor Canadian egg production in 1973 the competitive costs of producing eggs in Canada has deteriorated drastically relative to the United States This has occurred in Ihe lace ol substantial evidence that the potential cost of egg production Canada can be cost competitive w S egg production 3 Egg pnces in Canada would be much higher if Canadian food were not subsidizing egg costs by pricing eggs well below distribution costs At present US retailers charge cents per dozen more Canadian retailers to eggs to the consumer In addition to imposing an unnecessary to million cost upon the Canadian consumers egg costs monopolistic supply management policies provide a major threat to efficient family farm agriculture For example a young farm family who wants to start a medium sized egg farm with 30 000 layers must first buy quota from existing producers This could cost as much as to 000 and cost theyoung farmer as much as 50 just in interest costs These quota costs effectively provide a barrier to young farmers entering egg production These in the ultimate analysis are borne by the Canadian consumer In recent weeks egg producer marketing board officials have indicated that in some provinces quota transfer policies alone increase egg pnces up to 5 cents per dozen because producers are not allowed to buy and sell egg quotas freely having to purchase an existing egg farm 5 It will take some time to reestablish compeitiveness in the Canadian egg industry and a start should be made now There is evidence to suggest egg production costs in Canada are dangerously close to the point where there is no overall benefit to Canada from maintaining production activity except on a short term make work welfare proiect basis The immediate requirement is lor major initiatives and policy changes to improve the cost efficiency egg production in Canada 6 Ifsubstantialcost price improvements in Canadian egg production cannot be effectively achieved the benefits of expanding egg imports and cutting back egg production in Canada g by one third should be considered as this course of action appears to provide sufficient cost savings to the egg system and potential net economic benefits to the Canadian consumer 7 On very rare occasions particularly since the adoption of a Canadian egg supply management system in the cost of U S and Canadian eggs come together but historically these occasions are short lived When U egg supply normalizes in response to market demands US egg prices can drop by cents per dozen in one month 1979 Importing a large quantity of U S eggs is not the recommended course of action Rather it is suggested as an opt on of last resort 9 The current concern of Canadian consumers government and industry officials about high egg prices high costs of egg production and supply management policies in Canada is justified This same concern shoukTbe shared by egg producers and egg marketing officials because of the potentially severe impacts that hign egg production costs can have and are likely to have on the future viability and profitab of the egg production industry and individual egg producers in Canada 10 This deterioration in the competitive cost position of the Canadian egg industry primarily as a result of government policies is not the only food area affected The AERCC plans undertake other studies of the Canadian food system to identify and quantify other cost improvement opportunities For a copy of complete report write to Economics Research Council of Canada Ave Ottawa Ontano KIR 6G8 L5