~-j saskatchewan · research: > the first meeting of the canadian poultry research council held...

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SASKATCHEWAN

R E p 0 RT

SASKATCHEWAN EGG PRODUCERS

TABLE OF CONTENTS

AGENDA3

13

AUDITOR'S REPORT

PROPOSED SASKATCHEWAN 2003 BUDGET14

CHAIRMAN'S REPORT

16

C.E.M.A. DIRECTOR REPORT20

MARKETING REPORT

24

GENERAL MANAGER'S REPORT25

POULTRY EXTENSION REPORT27

SOIL APPLIED POULTRY MANURE31

3 6

CANADIAN TABLE EGG IMPORTS37

INDUSTRIAL PRODUCT REMOV AL 200242

2002 IP SUMMARY43

POOLED INCOME FUND50

51

COP YEARLY SUMMARY 200252

HEN INVENTORY l\1ATRIX53

us SITUATION AND OUTLOOK56

SASKATCHEW AN EGG PROD,UCERSBoxI637,1810-9THAVENUENoRTH

REGINA, Saskatche\van. S4P 3C4TELEPHONE: (306)-924-1505

FAX: (306)-924-1515

EMAIL:Sep~saske1!1!.ca

1

2002 DIRECTORS

NAME ADDRES~ PHONE # & FAX

JOSEPH M. MANDEL(306)-622-4417

F AX(306)-622-443 7

Tompkins Poultry FannBox 309Tompkins, Sask. SON 2S0

ST AN FEHR (306)-225-5722Fax(306)-225-5866

Fehr VenturesBox 450Hague, Sask. SOK lXO

BERT HARMAN C\O Star Egg Co. Ltd.

201 Avenue "D" South

Saskatoon, Sask. S7M IP8

(306)-244-4041Fax(306)-664-6619

DA VID HOFER(306)-731-3560Fax(306)-731-2364

Affi1 River ColonyBox 570Lumsden, Sask. SOG 3CO

DON WIENS Horizon Poultry Fam1RR#1, Box 16ARegina, Sask. S4P 2Z1

(306)545-6170Fax(306)545-4112

TIM WIENS(306)-543-4777Fax(306)545-0661

Southeast Poultry FarIrlBox 1812Regina, Sask. S4P 3C6

ELECTIONS & APPOINTMENTS

CHAIRMAN ; BERT RARMANVICE CHAIRMAN DON WIENSCEMA DIRECTOR TIM WIENSCEMA ALTERNATE STAN PEHRSASKATCHEWAN POULTRY COUNCIL BERT HARMANMARKETING DON WIENSEGG QUALITY : DAVE ROPER

JOSEPH MANDELADVISORY COMMITTEE BERT HARMANCONCILLIATION COMMITTEE BERT HARMAN

2SASKATCHEWAN EGG PRODUCERSBOX 1637, 1810-9TH A VENUE NORTH

REGINA, Saskatchewan. S4P 3C4TELEPHONE: (306)-924-1505

FAX: (306)-924-1515

EMAIL:[email protected]

2003 ELECTED BOARD OF DIRECTORS

NAME ADDRESS PHONE # & FAX

ST AN FEHR (306)-225-5722Fax(306)-225-5866

F ehr Ventures

Box 450

Hague, Sask. SOK lXO

BERT BARMAN C\O Star Egg Co. Ltd.201 Avenue "D" SouthSaskatoon, Sask. S7M 1P8

(306)-244-4041

Fax(306)-664-6619

JOSEPH E. HOFER (403)-937-3798

Fax(403)-937-0009

Spring Creek ColonyBox 29Walsh, Alberta TOJ 3LO

JOSEPH MANDEL (306)-622-4417Fax(306)-662-4437

Tompkins Poultry FarmBox 309Tompkins, Sask. SON 2S0

DON WIENS Horizon Poultry FannRR#I, Box 16ARegina, Sask. S4P 2Z I

(306)545-6170Fax(306)545-4112

TIM WIENS (306)-543-4777Fax(306)545-0661

Southeast Poultry FanI1Box 1812Regina, Sask. S4P 3C6

3SASKATCHEWAN EGG PRODUCERS

34TH ANNUAL PRODUCERS MEETING

TRA VELODGE -SASKA TOON, Saskatche\van

THURSDAY, MARCH 6TH ,2003

CHAIRED BY- DON WIENS

8:00 A.M. REGISTRATION & COFFEE

8:30 A.M. BUSINESS MEETING-DELTAROOM-LOWERLEVELCOFFEE BREAKS WILL BE CALLED BY THE CHAIRMAN

AGENDA

WELCOME

Call 34TH Annual Meeting To Order

2. INTRODUCTION OF OUT OF PROVINCE GUESTS

3. ADOPTION OF THE ;-\GENDA

4. MINUTES FROM THE 331{1) .,\NNUf\!. PI{OOUCER MEETING

5. BUSINESS ARISING FROM THE MINUTES

6. SASK. CHAIRMAN REPORT -BERT HAR.l\'1AN

7. 2002 AUDITOR'S REPORT -RICK LeGRAND -E.J.C. DUDLEY

8. SASK. CEMA DIRECTOR'S REPORT -TIM "'lENS

9. 2003 PROPOSED PROVINCIAL BUDGET -BERT HARl\1AN

10. HAI~OIJD FROESE -EXECUTIVE COMMlll'I~I~ 2NI) VICE

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I I. NATIONAL FARl\1 PRODUCTS COUNCIL

12. JUDY BUNDROCK- CEMA TRADE SPECIALIST

13. U of S POULTRY EXTENSION

14. MICHAEL KATZ- MANAGER'S REPORT

15. NEW BUSINESS

1) Appointment of Auditor for 2003

16. START CLEAN STAY CLEAN TOP "10"Graham Marriott aDd Cord HerDer

17. QUESTION PERIOD

18. Ar~NOUNCEM~NTS

19. ADJOUIZ1,\:MENT

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SASKATCHEWAN EGG PRODUCERS33RD ANNUAL PRODUCER MEETING

TRA VELODGE HOTEL- SASKATOON, SASKATCHEWANTHURSDAY MARCH 712002

MINUTES

I. CALL TO ORDERThe 33 rd Annual Producer meeting was called to order by meeting Chairman DonWiens at 9: 15 a.m.

2. WELCOMEMeeting Chairman Don Wiens introduced the out of town guests.

Laurent Souligny CEMA ChairmanJudi Bundrock CEMATrade SpecialistRon O'Connor ViceChairmanNFPCSteve Howe AlbertaDirectorPaul Walter Alberta DirectorRoss Ramage Manitoba Egg ProducersGord Herner CEMA Field Audit Ma11itoba\SaskatchewanGraham Marriott CEMA Field Audit Alberta\Saskatchewan

3. ADOPTION OF TilE AGENDAChairman Don Wiens reviewed the proposed agenda.

MOTION: Moved by Harry "'addell from Section Seven Farms to accept theagenda as presented with the power to add.

Seconded by: Dave RoferCarried

4. MINUTES FROM THE 32ND ANNUAL PRODUCER MEETINGMeeting Chainnan 'Don Wiens highlighted the minutes that were circulated inadvance of the annual meeting.

MOTION: Moved by: Dave Hofer of Arm River Colony to adopt the minutes as

presented.Seconded by: Andy Gross of Riverbend Farms Ltd.Carried

s. BUSINESS ARISING FROM THE MINUTES

None

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6. SASKA TCHEW AN CHAIRMAN REPORT- BERT BARMAN

2001 Chairman's Report- Bert Harman

~ Advent ofEFP Quota has resulted in some changes:

~ Cheques come from Egg Board, not Egg Station.

~ Some eggs receive a lower price.

~ Eggs destined for EFP proceed directly to processing stations from the barns withoutpassing through a grading station.

~ The egg processor is requesting eggs with a darker yolk color than we produce.

~ Tim Weins is representing Sask. Egg Producers during the process ofrevising the eggFederal-Provincial Agreement.

~ The Board is attempting to obtain larger quota for Saskatchewan. Our original shareof the Canadian Allocation (4.76%) has dropped to 4.21 %. We are asking for a one-time allocation of 109,000 birds in table quota, and 500,000 in EFP allocation- aswell as a more favorable method of allocation to ensure growth in our industry.

~ To encourage consideration of our concerns, we have refrained from attending severalmeetings of the committee to revise the FPA.

~ CEMA dispute over quota began when central Canada was issued additional 300.000EFP quota.

~ Saskatchewan challenged CEMA's decision to NFPC in July 2001.

~ Saskatchewan suffers from a lack of influence on the allocation of quota in the

system.

~ Saskatchewan has the ability to produce competitively. but under the QACAgreement. increases in quota will be partly tied to provincial population figures.

Since Saskatchewan's population is stagnant. we will not receive increases in quota.

~ .Saskatchewan does not have a breaking industry. and EFP quota allocations are givenout according to contracts with the breaker.

~ Board and Government counterparts agree the system as it stands is disadvantageousto Saskatchewan.

~ CEMA levies: Two years ago, CEMA began collecting on a unified per bird basischanging from collection based on eggs marketed.

~ Saskatchewan decided to remit based on eggs marketed as the CU1Tent FP A uses levyremittance based on marketings.

~ CEMA claims we owe $167,000 in unpaid levies.

~ Two smaller producers approached the Provincial Council asking to have theminimum exemption for unregulated birds in Saskatchewan increased from 300. This

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would have a negative effect on the registered production in the province, as anyincrease to this exemption would decrease the number of regulated layers.

» CEMA Annual Summer meeting for 2002 to be held in Saskatoon.

» Board Initiatives for 2002:

» Myers Norris Penny has been commissioned to do a feasibility study to attractindustry and increase market for Saskatchewan eggs.

» Myers Norris Penny has been commissioned to select a person to "provide transitioninto leadership" on our staff in the Board office.

» To bring the Minister of Agriculture up to speed with industry issues: monthlymeeting will be scheduled with the Government.

» At the January 712002 Directors meeting, the Board passed a motion regarding thestand down of Directors. We are concerned about the declining number of producersin the province, which may result in a failure to fill all six-board seats in the future.

Referring to MOTION: Moved by Tim Wiens sec 8.3(1) No Director shallserve on the Board for more than the 6 consecutiye years without standing downfor at least one year. This section should be removed and replaced with 3Directors odd/even year elected for two- year term. Seconded by Don Wiens , 1opposed, Carried.

7. 2001 AUDITORS REPORT- RICK LEGRAND EJC DUDLEY & CO.Meeting Chaimlan Don Wiens called on Rick LeGrand ofEJC Dudley & Co. topresent the audited financial statements.

MOTION: Moved by Zahir Hemani or Sully's Cage Layers Ltd. to accept EJCDudley & Co. 2001 audited financial statements as presented.

Seconded by: Dave Horer or Arm River Colony.Carried

8. SASKA TCHEW ~ CEMA DIRECTORS REPORT- TIM WIENS

2001 CEMA Director Report -Tim Weins

Federal-Provincial Agreement:

~ Quota allocations need to be refornled to meet the needs of Saskatchewan producersand to ensure new growth can be generated.

Cost of Production:

~ Cost ofProduction study was completed and various costs updated according to the

new formula.

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Industrial Products:

)- An in-depth study has been undertaken of the processing market and pricing systemsin hopes of developing a framework for long-term contract negotiation in order tomove away from yearly negotiation of processor contracts.

)- Industrial products portion of levy has dropped one cent/doze~ while administrationportion has increased half a cent.

Marketing and Promotions:

> Market research showed us that consumers remembered the 2001 advertisingprogram. 2002 series continues the omelet theme began last year.

> Heart and Stroke Foundation has allowed us to use the Health Check Symbol (tm) onegg cartons and promotional literature.

Government Relations -Nutrition:

~ Through 2001,CEMA was very active in government consultations on the newnutrition labels. New labels if implemented, will make it mandatory to list thenumber of milligrams of cholesterol per serving. CEMA provided scientific evidencethat dietary cholesterol is not a public health concern.

)- 2001 marked a new round of the World Trade Organization negotiations. The

national supply management organizations have placed a representative in Geneva to

gather information on our behalf. We participated in a trade mission to Geneva.

Criminal Code:

»- Lobbying by the Canadian Turkey Marketing Agency, Chicken Fanners of Canadaand the Canadian Broiler Hatching Egg Marketing Agency and CEMA resulted inamendments to Bill C-1SB (Animal Cruelty Law), avoiding frivolous prosecution of

fanners.

Communications:

). A communications risk audit was conducted by consultants to develop an issue

response manual to guide the Agency during a serious event.

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Research:

> The first meeting of the Canadian Poultry Research Council held in January 2002.The council will help feather groups consolidate research efforts, avoid duplicationand provide the expertise needed to prioritize research funding.

Code of Practice:

~ Work continued on revisions to the humane handling code for our sector. The codehas not been finalized, but new guidelines should be available in 2002.

9. 2002 PROPOSED PROVINCIAL BUDGET- BERT BARMANChainnan of the Board Bert Hannan, presented the 2002 proposed provincial budget(circulated in advance).

MOTION: Moved by: Bert Barman of Barman Poultry Farm to accept the 2002

budget.Seconded by: Zahir Bemani of Sully's Cage Layers Ltd.Carried

10. LAURENT SOULIGNY -CEMA CHAIRMANCEMA Chainnan Laurent Soulingy expressed his pleasure to be able to attend theSaskatchewan Annual meeting and meet with producers that are interested in the

industry.Laurent complimented Tim and Bert on their presentation and said he understoodSaskatchewan request to be treated fairly.Laurent is committed to see the provinces move ahead, and he wants to haveSaskatchewan back at the table. It is better to start with one on one, than to come backto the table and meet.Laurent made reference to the chicken board and their struggle with the FP A. It tooktwo years to reach an agreement.Laurent closed with a challenge for Saskatchewan to come back to the CEMA table.

11. RON O'CONNOR- VICE CHAIRMAN NFPCRon extended a welcome on behalf of the National Fann Products Council. Heoutlined NFPC makeup and responsibility. Ron identified two important items:stability and change. Stability brings growth and fair prices but requires change tocompete in world markets.The NFPC export committee worked with Turkey and Chicken to establish export .market.The supervisory board worked on the FPA with chicken. Working together they weresuccessful is reaching a signed agreement.

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12. JUDI BUNDROCK- CEMA TRADE SPECIALIST

International Trade Update Summary

World Trade Organization (WTO) Negotiations in Doha, Qatar -November 2001.Goals for 5th Ministerial Meeting -Mexico 2003

Agricultural Negotiations -What are we looking for?

)- Ability to grow our domestic industries

)- Farmers should be able to make a living from agriculture

)- Ensure the continued effective functioning of supply management

)- Maintaining over quota tariffs at current levels

Agricultural Negotiations -What can CEMA do?

)- Promote the benefits of & ensure the development of agricultural modalities

favourable to supply management.

)- Work together with other like-minded organizations around the world

)- Promote SMS Trade Policy Position

)- Promote credibility of Canadian approach

Agricultural Negotiations -Timelines -.Are they achievable?

» Modalities established by March 31 st, 2003: Achievable -draft form only

» Members submit their schedules for review at the 5th Ministerial Meeting (fal12003)-It is expected that following the March 2003 deadline, much time will be spent

negotiating around the draft text. The Fall deadline to review modalities at the WTOMinisterial Meeting may not be achievable.

» Negotiations to end by November 2005

13. U OF S POULTRY EXTENSION -WILLIAM AUDRENFunding for the Saskatchewan Poultry Extension Services is shared by the fourSaskatchewan poultry Boards and Lilydale CO-OP..The results of the SE program were reviewed. In 200 I four strains of salmonella were

reported. Salmonella Mbandara is the most common type found in Saskatchewan.Salmonella Orion and Anatun were two new strains not present in Saskatchewanlaying flocks last year .Farm visits indicated some producers were overfeeding protein to hens during the last15-20 weeks of production. Protein levels could be decreased by 1-2% with no effecton production or egg size.

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Poor shell quality was found in a number of flocks. To correct the problem a topdressing of oyster shell on the last feeding was rt:commended or by adding vitaminD3 in the water.

INFECTIOUS LARYNGOTRACHEITIS (lLT)

A survey of serological titers for ITL was initiated in 2001 and was completed in thespring of 2002. Samples were selected from 20 flocks at random and tagged. Bloodsamples were collected every eight weeks for the life of the flock.The results of the survey indicated that there is not a problem with clinical disease inSaskatchewan flocks and that the use of vaccination against ILT is not required.

14. DA YE MACIaE -MANAGER'S REPORTWork on the Egg Infonnation System (ElMS) continued in 2001.Utilization averaged out to 95.75%.Declarations over 52 weeks totaled 211,840 boxes, this is 22,224 boxes lower thanlast year.Egg Pricing- Producer price and cap price averaged at 1.396\dozen.Eggs For Processing- The first EFP layers were placed in June 2001 and at the end ofweek#52 there were 69,228 EFP layers in produ,~tion. EFP freight costs were 5 centsper dozen.Soil Applied Poultry Manure: A wet fall and machinery breakdown set the projectback by one year.Promotion: "The Gift of Goodness" Billboard campaign started act 29 and went sixweeks. Canadian Western Agribition -Lifesyles and Agri-Ed.

MOTION: Moved by: Fritz Mandel of Eatonia Colony to accept all reports.Seconded by: Phil Entz of Abbey Poultry FarmCarried

15. NEW BUSINESSa.) Appointment of Auditor for 2002

MOTION: Moved by": Andy Gross of Riverbend Farms to accept EJC Dudley & Co.as auditors for the Saskatchewan Egg rroducers for the year 2002.

Seconded by: Stan FehrCarried

b.) Start Clean Stay CleanTop 10 -Graham. Marriott and Gord Herner CEMA Field Auditors spoke on theHACCP start clean stay clean program and presented plaques to the top 10producers with the highest score:

#461 Hannan Poultry Bert Hannan#630 Sand Lake Colony Ben Wurz#712 Bone Creek Colony. Ben Entz#646 Cannichael Colony Amos Entz

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#612 Clear Spring Colony#610 Bench Colony#580 Dinsmore Colony#648 Eatonia Colony#643 Tompkins Poultry Farm#424 Conly Farms

Reuben WurzMatt KleinsasserJohn HoferFritz MandelJohn MandelRob & Koreen Conly

c.) Director Stand Down

Chaiman Bert Haffi1an called up Dan Entz of Bone Creek Colony and presentedDan with a plaque in recognition of his six years of service on the SaskatchewanEgg Producers Board. -

d.) Board Policy- Update

MOTION: Moved by: Bert Harmau for the Board to update the Board orders toreflect current procedure.

Seconded by: Dave HoferCarried

16. ADJOURNMENT

MOTION: Moved by Ben Entz of Bone Creek Colony to adjorn the meetingCarried

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SASKATCHEVVAN EGG

PRODUCERS

Financial Statements

December 31, 2002

~~

Page 1 Auditors' Report

Page 2 Balance Sheet

Page 3 Statement of Operations and Surpius

Page 4 Statement of Cash Flows

Page 5-6 Notes to the Financial Statements

Page 7 Schedule of Expenses

Page 8 Additional Information

AUDITORS' REPOR!

To The Directors of

Saskatchewan Egg Producers

We have audited the balance sheet of SASKATCHEWAN EGG PRODUCERS as atDecember 31, 2002 and the statements of operations clnd surplus and cash flows for the year thenended. These financial statements are the responsibili1:y of the board's management. Ourresponsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with Carladian generally accepted auditing standards.Those standards require that we plan and perform an audit to obtain reasonable assurance whe:ther thefinancial statements are free of material misstatement. An audit includes examining, on a test basis,evidence supporting the amounts and disclosures in thE~ financial statements. An audit also includesassessing the accounting principles used and significarlt estimates made by management, as "well asevaluating the overall financial statement presentation.

In our opinion, these financial statements present fairly, in all material respects, the financialposition of the board as at December 31, 2002, and the~ results of its operations and its cash flows forthe year then ended in accordance with Canadian gene:rally accepted accounting principles.

~~~~riIQ:- ~--4//~ k E.J.C. Dudley & Co.

Chartered AccountantsRegina, SaskatchewanJanuary 27 I 2003

l

SASKATCHEWAN EGG PRODUCERSBalance ShE~et

As at December ~~1. 2002

ASSETS

{Restated)~

$ 119.951972,500924, 171

2,270-29.084

2,047,976

~$ 408,261

998,488

514,654

2,36529.318

1,953,086

CURRENT ASSETSCash and bankInvestments -note 3Accounts receivable -note 2

Prepaid expensesAccrued interest -note 3

Total Current Assets

CAPIT AL ASSETS -note 4Total Assets

119.058

,112.072.14487.042

$2.135.018

LIABILITIES AND ~)URPLUSCURRENT LIABILITIES

Accounts payable and accrued liabilitiesCanadian Egg Marketing Agency -Levies

Total Liabilities

$ 236,593

214.013

450,606

$ 337,706

199.014

536, 720

1.621.53§$2.072.144

1.598.298

$2.135.018

SURPLUS -page 3 -note 7Total Liabilities and Surplus

See Accompanying Notes

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SASKATCHEWAN EG,G PRODUCERS

Statement of Operations and Surplus

For the year ended December 31. 2002

IndustrialProduct

RemovalProqram

(Restated)

""Total

ZQQ1

General

Qlli~rations

Total

~

$ :397 ,538

67,657

20,864167

0

-5.423

-491.649

$ 385,055 $ 782,593 $ 691,5700 67,657 74,7990 20,864 26, 7340 167 118

4,436, 796 4,436, 796 3,982,8070 5.423 0

4.821.851 5.313.500 4.776.028

REVENUEProducers levyInterestOver quota penaltiesLicensesProceeds from CEMASummer meeting (net)

Total Revenue

'100,881

94,943

287 ,742

24,617

0

0

90,072

20,154

0

0

0

-73.711

~92.120

(L200.471)

EXPENSES

Administration -page 7Board of Directors -page 7Personnel -page 7PromotionFowl removal programProvincial share of levyResearch and studies -page 7

Rent, janitorial, insurance & utilitiesPurchase of product

HandlingProvincial removalEFP net payments

Total ExpensesExcess revenue ( expenses }

SURPLUS -note 7Beginning of yearEnd of year

1.598.298 1.569.656

$1.621.538 W98.298

See Accompan"/ing Notes

00000000

4,436, 7966,000

155,3440

4,598.140$ 223.711

100,881

94,943

287,742

24,617

0

0

90,072

20, 154

4,436,796

6,000

155,344

73.711

5.290.260

23,240

62,919109,657172,537

37 ,50125,414

106,45965, 17020,269

3,982,8077,200

100,70656.747

4.747.38628,642

SASKATCHEWAN EG,G PRODUCERS

Statement of C.3sh Flows

For the year ended December 31. 2002

~

$5,713,77767 ,423

( 5.424.941 )

356.259

;fQ.Q1

$5,:306,954

71,126

( 5.744.053}

(365.973}

CASH FlOWS FROM (FOR) OPERATING ACTIVITIE:sCash receipts from members and other customer~;Cash receipts from interestCash payments to members, suppliers and employees

Cash Flows From (For) Operating Activities

( 41,961)

( 25.988)

( 67.949)

( 82,834)( 22.500)( 105.334)

CASH FLOWS FROM (FOR) INVESTING ACTIVITIE~)Purchase of capital assetsIncrease to investments

Cash Flows From (For) Investing Activities

Net increase ( decrease) in cash 288,310 471,307)

CASH POSITION -Beginning of the year

-End of year119,951

$ 408.261591.258

L119.951

See Accompanying Notes

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Notes to the Financial Statements

December 31~

1 SUMMARY OF :5IGNIFICANT ACCOUNTING I>OLICIESBASIS OF ACCOUNTING

The accrual basis of accounting is used in determining revenues and expenses.

MEASUREMENT UNCERTAINTYThe amounts recorded for the allowance for doubtf~1 accounts and estimated useful life of

capital assets are based on management's best estimate. These estimates are reviewedperiodically and as adjustments become neces~)ary they are reported in earnings in the period inwhich they become known. By their nature, estimates are subject to measurement uncertaintyand the effect on the financial statements of an:f changes in estimate could be significant.

ACCOUNTING FOR INCOME FROM LEVIES AND LICENSES FEESThe Board is empowered under enabling le!~islation (The Agri-Food Act) to collect levies and

license fees on all eggs marketed in Saskatchewan.

The Board required producers with flocks of 300 laying hens or more to be registered by theBoard.

The Board has instituted a unified levy system which bases the levy on expected number ofdozen eggs which will be produced in a fifty-thrl3e week (53) period. .

~

$5,237.729

£QQ1

$4,746,914Total levies charged to all producers

Portion of levy attributed to CEMA based upon actualreported marketings of eggs 4,455, 136 4,055.344

Amount retained by the Board 782,593 691,57Q

Portion of levy allocated to Board Administration 397.538 387.124

Remainder of levy allocated to Industrial Produ(::t Removal $ 385.05~ u~2. ACCOUNTS RECEIVABLE

Accounts receivable is made up of the follo\Ning:

2QQ.2

$ 89,249

81,103

315,945

28.357

$ 514.654

£QQ1$ 139,386

61,029

259,805

~~

Producers -leviesProducers -penalties and interestCEMA -industrial product, freight and otherEFP and other

$ 924.171


Notes to the Financial Statements

December 31~

AccruedJnteres!

3.~

$494,488 $ .28,270

INVESTMENTSBank of Montreal

Guaranteed Investment CertificateInterest Rate: 6%

Maturity Date: January 20, 2003

500.000 1.048Guaranteed Investment CertificateInterest Rate: 2.25%Maturity Date: November 05, 2002

$998.488 ~41§

4. CAPITAL ASSETSThe Board records capital assets at cost less accumulated amortization, with expenses for

repairs and maintenance charged to operations 81S incurred.

Amortization is provided using the diminishin~} balance method at a rate of 20% for furnitureand equipment, and at a straight line rate of 1115 for egg trays.

Capital assets and related accumulated amoftization as at December 31 are as follows:

2002

Net Book

~

$111,514

7.544

$119.058

2001

Net Book

~

$ 82,834

4.208

~~

Accum.

Amort.

$ 7 ,965

42.045

$ 50.010

~

$119,479

49.58~

$169.06,~

Egg traysFurniture and Equipment

5. INCOME TAXESThe Board is an agricultural organization from which no part of the income is payable to, or is

otherwise available for the personal benefit of an'v member, therefore it is exempt from income tax.

6. CONTINGENT LIABILITIESa) The Board is contingently liable for the amount of $47 ,600 in regard to a documentary letter ofcredit issued for the Canadian Egg Marketing Agency. This contingent liability is secured by -

assignment of prodl,lcers accounts receivable.

b) The Board currently remits levie5 to the Canadian Egg Marketing Agency using a calculationbased on egg marketings. The Agency prefers such remittances to be made using a calculationbased on bird issuance. If the Board had remitted levies based on issuance rather thanmarketings, the payments to the Ag.ency would have been approximately $256,000 higher over theyears 2000 to 2002. While the Board could eventually be required to pay some or all of theseshortfalls to the Agency, the amount and timing c,f any such future payment is not yet determinableand so no liability has been accrued at this time.

c) The Board is currently trying to settle a legal dispute regarding overquota penalties. and thecollectibility of some accounts receivable depends on the future resolution of the matter.

7. PRIOR YEAR ADJUSTMENTAn adjustment has been recorded to amend prior year EFP payables to actual. The 2001

ending surplus figure has been reduced from $1,666,575 previousllyleported to $1,598,"298.Comparative figures have been restated accordingly.

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SASKATCHEWAN EGiG PRODUCERS

Schedule of Expenses

For the vear ended December 31. 2002

~$ 6,466

1,05248

489

3,9722,0009,590

13,970.2,202

1,471850

5,08215, 727

-0

L~

Administrative ExpensesAudit and accounting feesAmortizationBank chargesComputer fees and suppliesEquipment rental, service contractMembershipLegalMeetingsPostage and expressStationery and copier suppliesSubscriptions and literatureTelephone and faxStrategic planningWeb development

Total Administration$100.881

$ 51,883

43.060

$ 94.943

$ ..71,042

38.615

$1!)-9 ~ 6 M

Board of Directors and ExpensesTravel and sustenancePer Diem allowances

Total Board of Directors

$183, 13325,24136,08743.281

$287.742

$128,820

19,951

23, 766

-'0

Personnel ExpensesSalaries and benefitsTravel -staff

-managerExecutive search, relocation

Total Personnel~72.53Z

$ 50,514

35,661

3.897

$ 90.07~

$ 50,514

11,697

-2.95~

L65.170

Research and Studies E-xpenses

Poultry extension programResearch & studies U of SSE testing

Total Research and Studies

SASKATCHEWAN EGG PRODUCERSAdditional Info.rmation

For the year ended Dec:ember 31. 2002

~$ 24,990

5,4145, 112

4,4402,6822,467

000

1,406330400

6.702

53,943( 29.326)$ 24.617

;~$ 0

00

2,67131

2,141'19,078

9,4216,6782,3592,3462,2004.652

51,57714.076

$ 37.501

PromotionLeader PostManitoba Egg ProducersAssured LogisticsStar EggCanada Egg Marketing AgencySaum EnterprisesTapp CommunicationsUPS Logistics Group

Papp signsLivingston Dist.Regina Exhibition ParkFAGSPayees (23) under $2,000Total paidLess recoveries

Net Expense

Per Diem AllowancesDavid Lo HoferDaniel EntzJoe MandelBert HarmanDon WiensTim WiensCliff ColbornStan Fehr

Total Expenses

~

$ 5,550

1,600

4,575

9,000

7,200

5,400

0

9.735

$ 43.060

;illQ1$ 5,325

4,8750

9,110

5,100

5,355

1,27~7.575

$ 38.615

Per diems allowances are paid to directors on a monthly basis for being directors, attendingmeetings and director travel. The per diems are paid in the following amount:

$150 per month$150 per meeting$75 per day of travel$175 per month$175 per meeting

Director per diemMeeting per diemTravel per diemChairman per diemChairman meeting per diem

SASKATCHEWAN EGG PRODiUCERS 2003 BUDGET

14REVENUES 2003 BUDGE:r

$405,~596$304,'197

$10,000$~500

$40,000$!500

$15,000$2,~500

$50,000$6,000

$834,:!94

provincial admin levy

producer levybank interestproducer interestinvestment incomelicense feesCEMA marketing contributionEFP trays, dividers, palletsEFP freight feeover quota penalty fees

TOTAL REVENUES

EXPENDITURES 2003 BUDGET

$170.000

$3.{)00

$50.()00$202. ~r98

~~$9,()00

$15,()00

$1.000$7.!)00

$32.!)00

$3,!)00$~)oo

$7.!)00

$7.!)00

$2.!)00

$7.!)00$7.500

$12,800

"$1.500$2,500

$231.500

[email protected].$51.()00

$3,!)00$54.500

$60.()00

$35.()00

$15,()00$15.()00

$20.()00

$5.()00

~Q.QQ$50.()00

$35,000

$4.000

$89.000

$47,000

$2,000

$1.000$50.000

$500

$1.087.698

-$253.40~

provincial removal (buyback)

assembly. storage & handling

EFP freight

provincial contributionsubtotal: operations

audit

legalbank charges

insurancesubtotal: professional servic.~

equipment rental

copier suppliesoffice supplies & equipment

computer equipment

subscriptionspostage & express

communications

office rent & services

utilities

janitorial servicessalaries & benefits

subtotal: office manaaement

Poultry Extension ProgramSe testing

subtotal: producer services

Directors: Travel

Directors: Per DiemsSEP meetings

staff travel

GM's travel & expenses out of prov

GM's travel & expenses in provsubtotal: meetina & travel

strategic planning expenseresearch & studies

poultry manure field spread test

subtotal: research & strateai(~

marketing & promotions

FAGS membership

charitable sponsorshipssubttl: marketinq & promotn

miscellaneous

TOTAL EXPENDITURES

CONTRIBUTION TO RESERVES:

$30,000-$283,405

CONTINGENT EXPENSES

early fowl removal contingency

cntrbtn to reserves less conti~

SASKATCHEWJ\.NLEVY TRAIL FO'R 00 .

STARTING WEEK# 01-2003

15

29.5

CEMA LEVY

26.0SASKATCHEWAN

<1.0>

SASKATCHEWt~N LEVY

4.5

PIF

CONSUMER

23.0

IP

RE!\JlOV AL

* 1.5 c

AD~~IN

3.0 cAOrvJIN

2.0 c

PRODUCER

LEVY

*1.0

The CEMA levy is allocated to two funds: the Administrative Fund, which covers the costs ofAdministration and Marketing; and the Pooled Income Fund (PIF), which covers the costs ofindustrial product removal, includil")g sales to breakers and interprovincial movement.The Saskatchewan provincial levy is allocated to two funds: the Administration Fund, which coversSaskatchewan's administration and promotion costs; and the Surplus Removal Fund, whichprovides additional funds to cover the costs of Industrial Product removal in the province that arenot covered by CEMA.

* NOT RECOVERED IN THE COP FORMULA

16

Chairman's ReQQr!

The Saskatchewan Egg Producers has completed another excellent year. We haveaccomplished much, and we are positioning ourselves for continued growth, profitabilityand stability in the years to come. Staffing additions 'to accomplish these goals have been

undertaken this year as you know.

Financially, you will note from the audited statements that, we are ending the year withsurplus pretty much on par with year-ago levels. Moreover, our cash position has

improved.

I'd like to discuss our progress and initiatives with respect to our industry operations andgrowth, our relations with CEMA and our provincial partners in the Canadian eggindustry, our relations with our Saskatchewan government and the Saskatchewan

community, and our internal operations.

You wil] recal] that CEMA -the Canadian Egg Marl<:eting Agency -committedthemselves in writing to a process to consider Saskat(~hewan's concerns and interestsregarding the quota allocations of the years 2000 and 2001, and they did so with thewritten encouragement of the National Farm Product~; Council. Your Board ofDirectorschallenged the CEMA Board to fulfill this commitme:nt. We went so far as to makeanother direct presentation to the CEMA Board this past fall, together with arepresentative of our Saskatchewan government. Regrettably, once again the CEMABoard refused to address our concerns, or to fo]low t]lrough by initiating a process to do

so.

The committee to review and revise the Federal-Provincial Agreement has nowcompleted the first phase of its work. The draft of the revised Federal-ProvincialAgreement is now being circulated to the provincial producer boards, and to theprovincial governments and supervisory boards. The next meeting of the committee willbe held in early April, to. address the issues and conce:rns that all signatories may raise.

The Saskatchewan Egg Board has informed the CEMA Board and the Federal-Provincialcommittee that Saskatchewan will not under any circumstances sign on to the revisedFederal-Provincial Agreement as it now stands and in the form that has been circulated.We have inforn1ed them that Saskatchewan's concern,s must be addressed. We havereiterated our concerns and interests numerous times) and we will do so again in April at

the next meeting of the Federal-Provincial committee.

In short, our interest -what we want -is that Saskatchewan's share of the Canadian tableegg market will be no less than what it was v.'hen we signed onto the egg plan back in t11eseventies -at the least. We reported to you last year t'hat this would involve a one-timespecial consideration of table egg quota of about 110,000 birds -at the least.

17

Moreover, considering how small is our share now jmd origina:lly, we will ask thatSaskatchewan's share of the table egg allocation never be cut. And considering howsmall is our egg industry in this province, we will ~k that our bird numbers for table egg

production never be cut. We will ask that our EFP allocation be raised appropriately. Andthen, just as important, we will ask that Saskatchewan will share in the growth of the eggindustry, in the growth ofboth the table egg market and the market for eggs forprocessing. To accomplish this we will continue to present the case ofusing comparativeadvantage as the principle to be used to allocate future quota to the provinces. We feelthat this principle found in the original FP A will beliefit Saskatchewan in the future.

As has been reported to you in our past meetings, some years ago CEMA changed theway that they collect their levies from what is described in the current Federal-ProvincialAgreement- that is, instead of on the basis of mark(~tings, CEMA decided to levy on thebasis ofbirds issued. They made this change without tile signed agreement of allsignatories. Your Board ofDirectors decided at that time to continue to remit levies toCEMA on the basis of the Federal-Provincial Agreement, and we continued to do so in2002. As explained in the notes to our audited finaru~ial statements, if The SaskatchewanEgg Producers had remitted levies based on issuanc(~ rather than marketings, our levypayments to CEMA would have been considerably !';feater over the years 2000 to 2002.

While the provinces gradually work tl1fough a process to revise the Federal-Provincial

Agreement, CEMA continues to make quota allocations and levy orders that reflect thestatus quo, and that do not address Saskatchewan's c:oncems and issues. You will behappy to learn t11at your Board of Directors has engaged new legal counsel- Mr. RobertRichards Q.C. of the Regina fim1 MacPherson Leslie Tyem1an -to develop our legaloptions. Mr. Richards is one of Canada's senior soli(~itors, with some 50 cases presentedto the Supreme Court of Canada.

The EFP program continues to challenge producers in Saskatchewan and elsewhere inCanada to operate profitably. Ontario and British Columbia have sidestepped the issuesof profitability by integrating EFP quota with table egg quota and increasing producerlevies to offset the lower returns to EFP productioIL Here in Saskatchewan we arepursuing ideas to enhance the profitability of EFP production. Your Board is takinginitiatives to develop our relations with Canada's egg processors in order to find ways toimprove our EFP returns.

There's good news now on the home front. Our Sask:atchewan Minister of Agriculture,Food and Rural Revitalization, the Hon. Clay Serby, has completed his review of the

Recommendations of the Saskatchewan Agri-Food Council based on the report by Mr.Bendig. His letter only deals witll the Government's views on how the industl-y candevelop -which confirnls that tlle Directors of The ~;askatchewan Egg Producers haveacted appropriately in the past in all matters.

18

Overall, the Saskatchewan Agriculture Department, (md the Saskatchewan Agri-Food

Council, continues to work closely with The Saskatchewan Egg Producers and to supportour actions and initiatives. We are very grateful for tllis support and involvement. Welook forward to maintaining and developing these relationships, as we- the three

Saskatchewan signatories -pursue the difficult chall(~nges of building the egg industry inthis province.

This year will also bring substantial changes in the Regulations and Orders of this Board.The Government is working on revising the Regulations, and we are working on revisingthe Orders. We expect to present the complete packal~e to producers in December,

possiblyat a single combined meeting of all Saskatchewan producers, instead of the usualtwo meetings, one in Swift Current and one in Saskatoon. This process will, for example,enable us to revise the obligation ofDirectors to stand down after a 6-year tenn, as hasalready been approved.

Looking to this new year, your Board of Directors continues to support the researchprograms at the University of SaskatchewaI1, which can only have long-tenn benefits forus all. While the audited statements show a large increase in research expenditures in2002, this was made to advance funds to the University of Saskatchewan for work inprogress that will be completed in 2003, which rnean~; that over the two years 2002 and2003, annual research expenditures should be about equal to 2001. In addition, in futurewe will be exploring other research avenues, including new product development, whichwill support increased processing and sales of Saskat(;hewan's eggs.

You'll recall that our levies in Saskatchewan rose by one cent at the sta11 of this year2003. This was put in place b)' CEMA to finance its continued hea\'y spending on surplusremoval, due to the high cost of feed and low breaker plices. Since producer prices andthe buyback remained flat v.'hile the cost ofproduction dropped one cent, the additionalone cent of levy simply flowed on through to consumers. However, CEMA actually putin place a two-cent levy increase, not a one-cent levy increase. In all other provinces, theother cent is being paid by producers, directly out of their pocket. Your Board ofDirectors has decided that producers are better offke(:ping their money, and we havedecided instead to draw down our financial reserves to cover the additional one cent oflevy to CEMA. In order to do this, we ~ave also decided not to reinvest our second GIC,which came due this past January 2003.

CEMA is taking initiatives to guide and manage the industty response to pressures fromthe animal rights community. These pressures have led some of our large customers infood service and retailing to make demands regarding on-farnl production practices, and

cage housing in particular. Alberta is field testing a questionnaire to assess on-faffi1production practices in light of the new Recommende(f Code of Practice for the Care andHandling of Layers. This questionnaire may be field tested across Canada alid here inSaskatchewan in the coming months. It is becoming increasingly clear that t11e grocery

19

retai1ers are becoming more conscious of animal rights issues. It is my opinion tl1at in thenear future they will be making demands on us as producers to meet standards acceptableto their customers for producing our product. They have already stated at CCGD

meetings held recently that they expect eggs to be pr,oduced on farms following the codeof practice. I expect pressures to continue from them for our farms to meet the code. Theboard will be watching carefully these initiatives.

This past year your Board of Directors met on avera!~e about twice per month. Thisincluded several conference calls to deal with pressing issues, and at least two strategic

planning sessions to deal, first, with our overall strat(~gic directions, and second, with ourstrategies for the Federal-Provincial negotiations. Our schedule for this year alreadyincludes at least one meeting per month, and willlik(~ly be intensified as the need fordecisions and action progresses. You can count on y(}ur Board to continue to workdiligently to develop the egg industry in Saskatchew~Ul.

We have a bright future for our industry here in Saskatchewan. We, your Board, lookforward to working together with each and all of you to achieve our goals. We stronglyinvite each and all of you to share and communicate :your ideas and opportunities withstaff or Directors. As a united team we can continue 1.0 accomplish much.

Respectfully submitted,

Bert BarmanChainnan

20

SASKATCHEWAN EGG PRODUCERS2002 REPORT BY Tlrlv'J WIENS

DIRECTOR TO THE CANADIAN EG(; MARKETING AGENCY

Several of the administrative programs at the Canadian Egg Marketing Agencywere expanded or intensified in 2002 to take ad\fantage of opportunities or torespond to new challenges. High supplies, poor prices for breaker eggs andincreased costs of production due to rising pullet and feed prices combined todeplete the Pooled Income Fund.

Financial Situation

At the end of 2002, CEMA'S Board of Directors had agreed to several cost-saving and revenue building actions. Some of these included a one-cent adozen increase in the recoverable levy, introducl:ion of a one-cent a dozen non-recoverable levy and an increase in breaker price. However, National FarmProducts Council twice rejected our request for a 27-cent national levy.Consequently, early in 2003, CEMA submitted a new plan, requesting a 25-cent-a-dozen CEMA levy. In addition, the Board of Directors agreed to raise anadditional $7 million from producer contributions, collected on a weekly basisthrough reductions to the industrial product claims.

This plan was not reached easily. CEMA continues to believe producers shouldreceive their COP over time, but the Agency was; pressed to take immediateaction to ensure there is enough money in the Pooled Income Fund so theIndustrial Products Program can continue to operate.

At the time of writing this report, I do not know if 'Council has accepted the plan.In the meantime, provincial boards continue to remit funds to the Agencybecause they understand how important it is to have a national orderly market foreggs. It is also essential that an approved levy order be in place.

Sharing the Market

Despite the difficult decisions regarding levy that had to be made at our lastBoard meeting, I again told my colleagues on the Board that Saskatchewan'sdesires to grow its livestock sector needed to be considered seriously. Nationalegg supply management is important for all provinces, including Saskatchewan,and for continued success, it needs to respond to the requirements of changingmarkets and economies.

21

Market Studies

To maximize the growth potential of our egg markets, we need to fullyunderstand the markets. Consequently, CEMA has commissioned severalstudies, some of which were completed in 200~~, so we can better know theindustrial, foodservice and retail markets. Price discovery and productsubstitutability studies were completed to help in the development of realisticproposals for our contract negotiations with breakers. In 2003, we will examine .

usage in the foodservice industry so we can better know the degree to which thissegment is using processed product. We will also be looking at pricing in theHotel, Restaurant and Institutions sector and dE~veloping an end-use price model

for the sale of eggs to processors.

Trade

The five national supply management organiza1:ions continue to work together toensure the voice of supply management is heard in the agricultural negotiationsof the World Trade Organization. Canada was instrumental in rallying farmersaround the world to develop an international farmers' declaration. About 10farmers' organizations from over 30 different countries have signed thisdeclaration which, among other things, recogni~~es the validity of orderlymarketing systems. Our goal for 2003 is to build on this alliance so farmers have

a greater voice as the negotiations progress.

We continue to meet regularly with government officials and the supplymanagement organizations have jointly hired a public affairs specialist tocoordinate our activities in Canada. This complements the work of anotherperson jointly hired by our organizations to wor~; out of Geneva.

Media Relations

CEMA launched an extensive media relations program in 2002. It began with anational opinion survey of 1 ,000 Canadians which revealed Canadians believe inmany of the principles of supply management. .Almost all Canadians believeCanada should produce enough food to satisfy its own needs. Canadians don'tmind paying more for their food if it ensures a safe and stable food supply and areasonable livelihood for farmers. We also learned that one in four believe

Canada should defend its agriculture industry a!~ainst unfair foreign competition.

We were so impressed with this vote of confidence in supply management wecommissioned independent spokespersons to do media interviews acrossCanada to publicize the results. All of the radio, television and newspaper

reports which followed were extremely positive.

22

Marketing

We created new television advertisements for :2002 based on the success of our2001 omelette commercial. The advertisements reminded all Canadians, nomatter what their cultural roots are, that there is an omelette in every fridge. Weexpanded the strategy in all of our marketing al:tivities -retail programs, publicintercepts and university promotions. An evenl: marketing program was alsocreated, called Operation Omelette. This media event generated a great deal ofcoverage as our team toured Canada promoting the versatility of eggs. In 2003,we are emphasizing the quality found in shell eggs by highlighting them in theintroduction of our commercials.

Quality in the Shell

Our nutrition programs continue to emphasize the nutritional value of eggs.CEMA negotiated use of the Heart and Stroke Foundation's Health CheckTMsymbol for use on all cartons of fresh shell egg:s. Many graders are takingadvantage of this licensing agreement. CEMA's research committee isexamining the potential of bringing several renowned Canadian scientiststogether to cooperate in the development of an innovative type of shell egg.These scientists are very excited about the prospect and we hope to launchresearch in this area in 2003.

Animal Welfare

At year's end, CEMA and the other national feather agencies were preparing topresent before the Senate Standing Committee on Legal and ConstitutionalAffairs. The committee was examining the impl~cations of new cruelty laws whichwould be put into the Criminal Code. Unfortunately, in drafting Bill C-10, thegovernment failed to provide some of the defences currently available in animalcruelty cases. We've emphasized to the government that Cal:ladian egg farmersabhor cruelty and believe penalties for cruelty rleed to reflect the severity of thecrime. We've also m.ade it clear we can't stand by and watch defences availablefor 100 years be removed.

The new Code of Practice was finalized in 200~~ and was distributed to all

regulated egg farmers early in 2003. The Code! was developed by consensusamong several groups representing industry, government, academics,researchers and veterinarians.

There are many changes in the Code. One change is the increase in spaceallowance for each typical white leghorn to 67 square inches from the oldrecommendation of 64 square inches. This is upon re-tooling, though, as allmembers on the Committee developing the Colje understood that change can besecured only if it is realistic. The new Code also says controlled moulting, when itinvolves feed deprivation, needs to be phased out by 2005.

23

CEMA is also a partner in an initiative to develop a way to monitor how closelythe Code is being followed on egg farms. As a producer, I am sometimesfrustrated by all of the requirements that are being put on farmers. But I alsoknow from what we are told by our colleagues in Europe and the United Statesthat the pressures by activists will only mount. We have to be ready.

Food Safety

Producing safe eggs remains a priority of egg farmers. In 2002, CEMA tookseveral steps to ensure our Start Clean-Stay Clean TM program remains current

with the times and consistent with the approachl being adopted by all majorcommodity groups and promoted by the Canadian On-Farm Food SafetyProgram. We have developed a module for freE~-run, free-range and organicoperations, recognizing that some producers are developing alternativeproductions to meet new consumer demands. Our goal is to have the alternativerating sheet ready for field use in 2003. Incidentally, alternative systems have apossible 108 points, compared to the 100 for cage housing, because of the extraprecautions required with the alternative systems.

Finally, I would like to extend my thanks to my fellow CEMA directors. We metseveral challenges in 2002 responsibly and directed several new initiatives. Ilook forward to more hard work in 2003 as we shape our marketing system inresponse to changing markets.

Cpa/admin/speeches and presentations/2002, Tim's report

24

Marketinq Report M.3rch 2003

This has been an interesting year for me as I have been getting involved in the Marketing plan forSEP. It started off with a workshop in Ottawa with marketers from most of the provinces to iron ou~some difficulties and to try to work together to use our finances more wisely. If the provinces can dothings together we only need to pay for the development of the project once.

With a new Manager come new ideas so in this year some new things have been planned, one ofwhich hopefully you have already been exposed to. This was our January and February promotion andsubsequent contest for a dinner for 2 and a weekend night at a hotel. This was implemented at this timeto promote eggs during a low consumption period. The other project that we are working on is thedevelopment of the web page with links to CEMA's recipes and information. If you would like to lookat the web page the address is W\vw .Saskegg.ca .

I am enjoying the marketing but at times budgeting the right amount of time for this kind ofproject isdifficult. Other contests and promotions are being planned for the year but are not finalized. I appreciatethe opportunity to be involved in the marketing of the produ,ct we produce.

Respectfully submittedDon Wiens

25

MANAGER'S REPORT ~'2002"

UTILIZATION

Saskatchewan's provincial hen allocation remained unchanged at 833,033 layers.Of this amount The Saskatchewan Egg Producers Board has issued 831,140, l~aving abalance of 1893 layers in reserve.

With the exception of Newfoundland, Prince Edward Island and New Brunswick,which are entitled to place 100% of their inventory. Layer inventory or utilization ofa1lprovinces must not exceed 97% of allocation on an average weekly basis.

Provincial utilization is calculated on a 2<)-week average. For Saskatchewanweeks #1 to # 26 average provincial utilization wa;s 792,290 layers or 95.16%. Duringweek # 27 to # 52 average provincial utilization was 794,312 layers or 95.35%.

INDUSTRIALPRODUcr

The 2002 Industrial Product declarations estimate was based on 215,000 boxes.ActuallP declarations for 2002 were at 225,400 box(:s, 6.4% increase over 2001levels.

EGG PRICING

Producer Prices changed six times through 2002.

COP Price

1.43

1.42

1.44

1.44

1.44

1.43

1.43

1.52

1.56

1.56

Producer Price1.421.441.461.461.461.471.481.52.1.521.58

December 30/2001.Tanua1")' 27/2002February 17/2002March 17/2002April 21/2002May 26/2002J une 30/2002August 25/2002October 5/2002October 27/2002

Average 1.481 Doz 1.469 Doz

CEMA buys back Industrial Product at the lower of the producer price or the COP .

26

EGGS FOR PROCESSING

Saskatchewan's Eggs For Processing (EFP) program started 2002 with 59,323layers in production, and dropped to 49,338 layers b,Y year end 2002.

Three producers cancelled their commitment and four producers did not renewtheir allocation for a second year.

The Large Breaker Price (Umer-Barry) averaged 51.6 cents dozen over the year, a1.4cents dozen increase over 2001.

PROMOTION

SPONSORSHIPSThe SEP was the provincial Holly sponsor for the Jingle Bell Run for Arthritis, and theSEP participated in sponsoring the Heart and Stroke Golftournarnent.

CANADIAN WESTERN AGRIBITION

The CW A was held in Regina and ran from November 25 to Saturday November30,2002. The SEP held displays in the lower Agridome for the Agri-Ed program and thefood fair located in the Queensbury. The SEP displays were staffed by numerousvolunteers, including producers and their wives, and SEP staff and their spouses. Thisincluded Don & Elaine Wiens, Dave and Pat Ma(;kie, Tom and Bertha Hofer, SamisHemani, Jeff Reimer, Verla Shulz, Debbie Szakacs and Chris Szakacs, Phil and SydnaStillborn and Van Stewart.

27

OF

JANUARY- DECEMBER 2001-

Prepared for'

Dr. H.L. Classen, Department of Animal and Poultry Science and Dr. S.Gomis, Department of Veterinary Pathology I University of Saskatchewan

Organizations funding the Poultry Extension Service

Prepared by:

Guillaume Audren

28

Salmonella program

The Saskatchewan Egg Producers continue to test all flocks for Salmonella ingeneral and more specifically Salmonella enteritidis (SE}. No SE was found inSaskatchewan egg flocks. However, there was an increase in the number offlocks testing positive for Salmonella during the 2002 period when compared withthe last three years, 16.0% vs. 13.6% and 14%, for 2002, 2001 and 2000,

respectively.

199719981999200020012002

10810888838881

393619121213

36.133.321.514.013.616.0

9

11

4

6

4

10

No flocks positive for Salmonella enteritidis

In 2002, ten strains of salmonella were reported. Salmonella mbandakacontinues to be the most common type of salmonella found in Saskatchewan.The other strains of Salmonella reported during 2002, were Salmonella rissen,

infantis. hadar, manhattan, branenderup, heidelberg, typ,'?imurium and agona.

Grading and shell quality

Concern was expressed by some producers in regard to the number of

undergrade eggs being produced. Specific gravity tests and egg candling wereused on one farm in order to determine the cause of down grades. To maintainshell quality. calcium requirement must be adequate in the diet. Adjustments incalcium levels need to be done according to age, daily production and feedintake of the flocks. Mechanical cracks can be responsible for a large proportionof down graded eggs and producers should ensure proper maintenance of egg

collection equipment. Particular attention needs to be taken during loac;Jing,

transportation, unloading <:1nd at the grading station to avoid mechanical cracks.Producers with concerns regarding egg grade out should communicate with theirgrading station and the Poultry Extension personnel.

Amino Acid requirements

A study financed by the Saskatchewan E:gQ Producers on amino acid

# of Positive flocks # of

29

requirements in laying hens is taking place at the University of SaskatchewanPoultry Centre. This experiment is designed to determine lysine requirement inlaying hens fed wheat diets and the efficacy of phase feeding protein (lysine) inlaying hen operations.

Nutrition workshop

The Poultry Extension organised a nutrition ~/orkshop in June 2002 for chickeffproducers. The following subjects were pre:)ented: feed ingredients for'layerdiets, whole grains in layer diets, feeding programs for layers, and economics oflaying hen nutrition.

University of Sas~:atchewan

Poultry Extension30

$ 39,939.00

$ 159,738.00

EXPENSES

Salaries

Travel

TelephonesConsumables

TOTAL

$$$

$

$

114,757.0013,525.00

747.00

1,810.00

130,839.00 $ 130,839.00

$ 68,838.00

BUDGET PREDICTIONS

Salaries $ 135,000.00 $ 139,043.45

Travel $ 20,000.00 $ 20,000.00

T elephone $ 1,000.00 $ 1,200.qO

Consumables $ 4,000.00 $ 4,000.00

TOTAL $ 160,000.00 $ 164,243.45

31~OIL APPkIED P~UL"fRY MANU~

4.3 P AMI Analysis 2002

Fall 2001 soil tests showed that only the 16 'tons/ac (35.9 tonnes/ha) and 32 tons/ac

(71.7 tonnes/ha) rate produced higher residual! nitrogen than the check areas with mostof the excess nitrogen in the top 12 in (30 cm) with slight elevation at the 12 to 24 in

(30 to 60 cm) depth.

In Spring 2002, the crop was again seeded to canary seed on May 28. Soil moisture

conditions at seeding were adequate for seed germination and emergence. A tank mix

of Puma Super and Buctril M was used for wj~ed control with limited success as plots

were quite weedy. Yields were also low in 2002 due to early drought stress, weed

competition, and grasshopper damage. In 2002, only the 16 and 32 tons/ac (35.9 and

71.7 tonnes/ha) rates applied in Spring 2001 had significant enough residual N effect to

boost yield in 2002. The lower manure applica-tion rates of 2, 4 and 8 tons/ac (4.5, 9.0,

and 17.9 tonnes/ha) had no increase in residual N compared to the check resulting in

no yield response with these treatments (Table- 2 and Figure 7).

Figure 7. Effect of Poultry Manure on Canary Seed 'field 2002

32

4.4 University of Saskatchewan Analysis 2002

4.4.1 Spring Available N, P, K, pH, E.C.Poultry manure applied in the spring of 2001 had relatively little impact on available N

except for the 16 and 32 tons/ac (35.9 and 71.7 tonnes/ha) rates that produced a

significant elevation. Extractable K was not significantly affected by manure addition at

the lower rates of application, not surprising since these soils have very high indigenous

K fertility due to their high clay content, but the Ihigh rate produced a significant increase

in soil extractable K. A similar trend was observed with extractable P. The extractable P

was significantly higher in the 32 ton/acre (71.'7 tonnes/ha) treatment compared to the

rest of the treatments, with the 32 ton/acre (71 "7 tonnes/ha) rate having about 53 Ib/ac

(60 kg) extractable P / ha 0 -30 cm depth compared to about 20 kg (17.6 Ib/ac)

extractable P / ha in the other treatments. The high rate of 32 tons/ac (71.7 tonnes/ha)

also caused a small but statistically significant increase in electrical conductivity

(salinity), which is indicative of some accumulation of soluble salts at this rate.

4.4.2 Canary Seed Yield

Poor early weed control and dry soil conditions early in the spring likely reduced the

yield potential compared to the previous year. Only the 16 and 32 tons/ac (35.9 and

71.7 tonnes/ha) rates applied in the spring of 2001 had a significant enough residual

effect to boost yield in Year 2 (2002). Yields increased from -444 Ib/ac (- 500 kg/ha)

in the control and low rate treatments to arourld 622 Ib/ac {700 kg/ha) in the 16 and

32 tons/ac {35.9 and 71.7 tonnes/ha) rate. The 16 ton/acre {35.9 tonnes/ha) rate gave

the optimal canary seed yield in 2001 and again in 2002. The 32 tons/ac (71.7

tonnes/ha) rate was the only treatment with significantly higher residual soil available N

in the fall after harvest.

Based on the first two years of data, a single application of 16 tons/ac {35.9 tonnes/ha)

may be best to optimize plant nutrition for two years and minimize nutrient and salt

accumulation in the soil.

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35

5. Conclusions

Due to various circumstances, the project is one year behind schedule. Poultry manure

was successfully applied and incorporated in the plots in Spring 2001. The plots were

seeded to canary seed in Spring 2001 and 2002. Yield samples were harvested with a

small plot combine in Fall 2001 and Fall 2002. Umited rainfall in 2001 resulted in poor

seed yields. With the exception of the 2 tons/ac {4.5 tonnes/ha} rate, each increase in

manure application rate resulted in incrementaljy higher seed yield. In 2002, only the 16

and 32 tons/ac (35.9 and 71.7 tonnes/ha} rate:3 applied in Spring 2001 had significant

enough residual N carryover to boost seed yield.

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37Canadian.Table Egg Imports

I~rojected2003

5,56613,87.939,9151~47940.4524~17441.69443,81630,29843,81060,87660,94473.801

P9riod 2001

22,559

19,718

29,597

35,336

50,910

50,795

44,810

43,760

61,320

55,170

43,072

48,809

75,325

2002 Difference11206 (11,353)

16,543 (3,175)

34,371 4.774

24,852 (10,484)

45,381 (5.529)

48,951 (1,844)

43,224 (1,586)

43,788 28

43,103 (18.217)

49,163- (6,007)

51.206 8,134

54.540- 5,731

74.559 (766)

Percentage(50.3%}

(16.1%}16.1%

(29.7%)

(10.9%)

(3.6%)

(3.5%)0.1 'Yo

(29.7%)

(10.9%)18.9%

11.7%

(1.0%)

1

2

3

4

5

6

7

B

9

10

11

12

13

Total S81,181 540,887 (40.294) {6.9%) 519,705

Source: Agriculture and Agri-Food Canad~Note: Italicized font represerzts projectiQns

38

Period

12

3

4

5

6

7

8

9

10

11

1213

2001

1,819,405

1,832,374

1,835,493

1,806,154

1,864,399

1,766,399

1,806,9741,825,673

1,816,646

1,838,6661,773,850

1,866,9461,800,602

o;D Change

{0.4%)

{2.0%)

(2.5%)6.3%

(8.7%)

1.2%

{5.6%}

(3.1%)

(3.1%)

(1.3%}0.5%

0.4%

0.7%

2002 Difference1,811.936 (7,469}1,795.763 (36,611}1,791.543 (43,950)1.928.391 122,2371 ,714,467 (149,932)1.807,745 21.3461.710.590 (96,384)1,771,264 (54,409)1,761,385 (55,261)1,814.562 (24.104}1,782,029 8,1791,874,704 7,7581.814.012 13,410

Total

Average

r.iax:imum

Minimum

23,673,5801.821.0451.866,9461, 773,850

(295, 190){22,707)122,237

(149,932)

(1.2%)(1.2%)

6.3%

(8.7%)

Estimated Canadian She] II Egg Disappearance.1

2001-21~O2

1,950,000 ;

1,900,000 ~I

1,850'000 !1 ,800,000 ,

cnI:) 1,750,000x

~ 1,700,000

1,650,000

1,600,000

1,550,000

1,500.000

2001

-/'.--~ ~

2002

1 2 3, 4 5 6 7 8 9 10 11 12 13

Period

23,378,3901,798,3381,928,3911,710,590

39

2001 PRODUCTION AND 2002 PRODUCTION ESTIMATES

2002 Estimated Production -Based on Inventory

GradeA + NR IPNest Run Undergrades Total IP J Prod'nPeriod Grade AAvg Inventory

2,333,7432,312,2332,313,2282,296,8242,324,9042,314,4752,323,9112,327, 777

2,322,6052,310,8452,316,8832,343,6972,358,736

634,302699,343522,348448,395579,998617,804651,474632,403552,207600,436580,430492,911494,760

25.7%28.6%21.4%18.5%23.6%25.3%26.5%25.7%22.5%24.6%23.7%19.9%19.9%

131,688 2,465,431130,474 2,442,707130,530 2,443,758129,604 2,426,429131,189 2,456,093130,600 2,445,075131,133 2,455,044131,351 2,459,128131,059 2,453,665130,395 2,441,241130,736 2,447,619132,249 2,475,946133,098 2,491,834

12345678910111213

18,853,29818,679,52218,687 ,56218,555,04618,781,89118,697 ,63418,773,86618,805,09818,763,32218,668,31518,717,08818,933, 70919,055,201

2,176,5912,156,5292,157 ,4572,142,1582,168,3472, 158,6202,167 ,4212,171,0262,166,2032, 155,2352, 160,8662,185,8742,199,901

157,152155,704155,771154,666156,557155,855156,490156,751156,402155,610156,017157,823158,835

23.5%

21.70/~

1.8%

30,199,85i 7,505,811

29,916,488 6,856,801

283,373 650,010

1,704,106 .31,903,972

1,688,115 31,604,604

15,991 299,368

18,767 ,042 28,166,228 2,033,63318,628,485 27,901,936 2,014,552

138,557 264,292 19,081

20022001

Change

2001 Production

IP f Prod'nIPTotal Gr;;det\ + NRPcriod Nest Run UndergradesGr~dc AAvg Inventory

2 .?"'

','.

229';,:2 .")0:

I ~ I.'

.Q 3 ",.tv. .,

2 "' 0":.:>. 1:'") 3 ')i!;..

-.~ "J.

22.3~o

21.3%

21.6%

22.8%

20.7%

21.2%

19.3°/c

:-'~8~', IE,t)

:-:.";.Ci:.;,5;:.G.) "..~.-

,...)1 :.!)...;)

2.:?.!:~.";22.295.5i82,300, i93

2,318,'142,296,6652,309,9002,280,0982,297, 739

2,303,1152,335,647

r~~ 0 -2.)u::, ~

555,7225i8.455..~ o .,~

."';1.,'.' .;.~

557,-504

563,747

545,211

516,104527 ,394

549,993502,659

515,370

476,404

? ' 1 ~' -.'. O ";J".:.".

2 ,1'=; ;;q:..~.~--

... 4 .- 0 "." ~

, .~ I -" ...". v...

') 4 00 -i J' \,. " , ~

2.425.0492.429.9382.448.9192.426.2602.440.2422.408.7582.427.3952.433.0742.467.44 i

.l...:"-(j...-.t~ :)-..,

~: ..: ~:; .3 3 ::;"") -: :;~ CP .

v..11

:~..: 1':;...4S') .

1 '(\ q~"u".~~

2. i45.3002.162.0142.142.0092.154.3532.126.5582.143.0112.148.0252. i 78.366

i5~,i92155,257'55.65~i 53.025

154,578154,893156,100154,656155,547153,540154,728155,090157,281

129.207130,099130.441

128,230129.531129.794130,806129.595130.342128,660129.656129.959131.795

1

2

3

4

5

5

7

8

9

10

11

12

13

18 5 ~.- -"r.

, .);).:>."..J

io,663.5i:::

18.712,48318 3°- 3.-~

.v:>, u::

18,58i.940

18,619,784

18,764,848

18,591,216

18,698,355

18,457,109

18,599,920

18,643,43418,906, 768

21,7°/v29,916.488 .6.856.80118:.628.485 27 .90i .936 2.014,552 1,688,115 31,604,6042001

41

Comparative Sates By YearBy Type -In Boxes

EndingInventory

Total EggsAvailable

Table Salesfrom Pool

Sa(es toProcessors

OpeningInventory Declarations

Period 1 & 2

Period 3Period 4

Period 5

Period 6

Period 7

Period 8

Period 9

Period 10

Period 11Period 12Period 13

38.333 1.334.028 1,372.361 1.054.924 6.520310.911 522.348 B33.265 565.016 11.620256.629 448.395 705.024 395.045 25,322284.657 579.998 864.655 655.B98 20.940187.817 617.804 805.621 555.777 19.240230.604 651.474 882,018 640,692 0

241.386 632.403 873.789 616.038 5.982251.769 550. '95 801.964 593.476 29.740178.748 602,250 780,998 556.511 18.798205,689 580.430 7B6.119 579.501 6.559200.059 493.354 693.413 513.457 10.076169.880 494,132 664.012 584.086 34.873

-7.506.811 7.310.421189.670

310,917256,629284,657187,817230,6D4241,386251,769178.748205,689200.059169,88045,053

Ending

Inventory

Total EggsAvailable

Table Satesfrom Pool

Sates toProcessors

OpeningInventory Declarations

Period 1 & 2Period 3Period 4Period SPeriod 6

Period 7

Period 8

Period 9

Period 10

Period 11

Period 12

Period' 3

23,397 1,162,776 1,186,173 985.8B1 19.371'80,921 553.523 734.444 505.749 34.649194.046 503.344 697,390 501.654 63.279132.457 579.562 712.019 482.029 2a,9a4201.006 588.758 789.764 564.589 14,246210.929 552,510 763.439 555,950 18.334189.'55 543.068 732.223 514.752 26.896190.575 544,801 735.376 554,574 17,475163.327 547.167 710.494 496,602 26.662187.230 551.289 738.519 566,961 24.571146.987 524.197 671,184 4B4.978 23.65B'62,54a 526.791 689.345 610.370 40.642

1,9B2.578 7.177.792 -6.824.089 33B,767

180,921194,046132,457201,006210,9291S9,i55190,575163,327187 ,230

146,987162,54838,333

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44

Loss Per Dozen By Year

Buyback Less Selling Price

2001

AverageSelling Price

$0.5418$0.6070SO.6659

$0.5452

$0.4261$0.3996

$0.4799

$0.4648

$0.4649

$0.4715SO.5754

SO.5163

2002

AverageSelling Price

$0.3741

$0.6264$0.5'24

$0.4311

$0.4338

$0.5166

$0.4784

$0.5511$0.4948

$0.5275$0.5903

$0.6241

All Inclusive

Buyback$1.3101$1.3453$1.3479$1.3665$1.3154$1.3422$1.3174$1.3385$1.4194$1.3056$1.3572$1.6144

Loss per

Dozen

$0.7683

$0.7382

$0.6820

$0.8214

$0.8893

$0.9426$0.8375

SO.B737

$0.9546

$0.8341

$0.7818

$1.0981

All InclusiveBuyback

$1.2533$1.5994$1.3726$1.3617$1.4437$1.4085$1.3889S1.4B99$1.4665$1.4735$1.5040$1.6234

Loss p~rDo%en

$0.8786$0.9730$0.8602$0.9306$1.0099$0.8920$0.9105$0.9388$0.9717$0.9461$0.9137$0.9993

Period1-2

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48

IP DECLARATIONS TRENDS

Period 2000 2001 2002 2003-Pt"oj.

1

2

3

4

5

6

7

8

9

10

11

12

13

613,324

619,527

522,087

447,877

455,298

521,162

523,615

483,815

442,534

477,721

514,648

591,492

502,277

585,092

558,722

518,465

440,036

557.604

563,747

545,211

516,104

527.394

549.993

502,659

515,370

476.404

634,302

699,343

522,348

446,395

579,998

617,804

651,474

632,403

552,207

600.436

580,430

492,911

494,760

637.474702,840524.960450,637582,898620,893654,731

635,565554,968594,960583,332495,376497.234

6,715,377 6,856,801

129,142 131,862

7 ,506,811

144,362

7,535,867144,921

Total

IAvg \f'Jeekly

Period

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51

1999- 2001 INVENTORY & PRODUCTION ANAL YSIS

Increase %Avg Inventory17.861,65118,284,02018,628.48518,767.042

1999200020012002

422.369344.465138.557

2.36%1.88%0.74%

Production -Boxes

Grade A

26,972,209

27,028,150

27,901,935

28.166.231

Nest Run1,521,6552, 136,9342,014,552

2,033,634

Undergrades Total1,622.205 30.116,0691,614.016 30,779.1001,688,116 31,604.6031,704,106 31,903,972

Increase %199920002001

200Z Est

663,031825,503

299,369

2.20%2.68%0.95%

Production -Breakdown

Grade A Nest Run

89.6% 5.1%

87.8% 6.9%

88.3% 6 4%

88.5c/o 6.1%

Undergrades

5.4%

5.2%

5.3%

5.3%

Total199920002001

Avg

100.0%100.0%100.00;0

Avq Production Per Laver -Oozens

Grade A Nest Run Undergrades

227 1.3 1.4.~~ 1 "

1 ."

.:.' .~ .Q ~

:::~5 j G 1 4

:::=5 i 5 j L;~ .; -..~ .

4I!L.() ..:> ..

Total

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254?- -,--:>...

25.5

1999

20QO

20(\1

"vg

2002 Est.

N.o .". TI,.. ,-- ~ ,\ .-. IS 1'.lg ...e r ." an P... o c ' L - \. 1 C .,. I'. -I-{ ) ') .. 1 . 1' - .-.1 ; ::.;:,"..; ;.."..:,'.,."" ..'.'.'.."".,u' ' ~..,..:.;:~'.'J..,,

iolto,.:i;'1::; ::';".:;::;'1:;

i~/$ n~mber includes produc~,or: from th'.? unregul,,:ed and h;)tch:ng s;:cto:-s

ihls number is based on inventory and not Issuance as in the COP

Source: Econome,rics .

Note: Italicized font re.oresents projections

2002 assu1111)s a .5~~ increase in proO:uclivily.

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55

56

US Situation and OutlookJanuary I 2003 .

layersAccording to the UsDA, in the first half of 2002 the numbel" of laying hens in the US was above thelevels recorded in 2001. However, in the second half of 2002, the opposite was true. The number oflaying hens in 2002 was below the levels recorded throughout the second half of 2001, asdemonstrated in the graph below.

Average Number of Laying Hen:s (millions)

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Source: United States Department of Agriculture

It is interesting to note that flock sizes (as of 2002) were at their peak in January (282.7 million) and

February 2002 (282.8 million), and hit the lo\'Vest point in July 2002 (274.7 million). This peak andtrough pattern does not correspond closely to the previous year's pattern. One of the reasons forthis deviation is said to due to the age of the 2001 flock. The 2001 flock was one of the oldest in thelast 16 years, and as a result January and February sho\"J a decline in the number of layers due tot~e disappearance of very old hens.

ProductionEgg production in 2002 increased by 1.0% I.'Jhen compared to 2001 levels. The US table eggproduction in 2002 increased by 1.2%, while annual hatching egg production decreased marginallyby 0.3% (when compared to 2001 levels).

Dec Jan Feb Mar Apr May Jun Jul Aug Sep Ocl Nov i' J

Source: United States Department of Agriculture

57

Table Egg Prices (Grade A -large)Table egg prices were generally strong throughout the 2002 period in the U.S. Table egg prices

throughout the country in 2002 fluctuated between a low of 0.582 and a high of 1.010. The shifts inprice resulted in an overall average price of 0.768. The overall average price in 2002 showed anincrease in price of 1.85% when compared to the overall average price in 2001. .

The following is a monthly average price table for Midwestgrade A large eggs, including tl1e price

differential yea r-over-year .

Production Outlook in 2003The recent outbreak of th~ e:<otic Ne\"Jcastle Disease in several counties in California and l'-Jevada hasbrought the 2003 projections into question. The full extent of the damage is not kno\fIJn at this time;ho\",ever I the most recent projections, \fIJhich were produced prior to the outbreak, suggested that2003 production levels \vould begin to fall below 2002 production levels in July. However, due to thisrecent occurrence it is possible that 2003 production levels will fall below the 2002 levels earlier inthe year.

Moreover, it is worth noting that California and Nevada's table egg production levels (in 2002)represent 8% and 4% respectively of the countri's total table egg production. Therefore, it can beinferred that this outbreak could jeopardize, at most, 12% of the country's table egg production.

Producer Price ComparisonAs of the first week of January 2003, the producer price/dozen in the U.S. and Canada was 0.601 and1.51 respectively. This compar1:.son indicates that the Canadian price is 0.91/dozen above the u.s.price (152% greater). .:

I Qu()t\:d ill C":III:ldi;J11 tloll:lfS.

~-j saskatchewan · research: > the first meeting of the canadian poultry research council held...

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