Ontario woman decided to purchase a federally inspected plant when an opportunity arose to sell beef to China
MOUNT FOREST, Ont. — Nancy Kingsley-Hu likes to think outside the meat box.
Once a trader of beer, ice wine and honey to China, she came into the beef business by chance.
“Some of my buyers in China were bothering me about pork and beef,” she said from her office at Mount Forest, where her meat processing company, Golden Ontario Products has been operating since she bought it in late 2012.
Kingsley-Hu and her family had lived in Shanghai for years so she was familiar with the culture and the business environment. When she decided to trade beef, she had to find a supplier and realized the best approach was to get her own federally inspected plant.
A 20,000 sq. foot operation called Frey’s Meats was available from the Mennonite Brethren. The plant had opened after BSE shut down export markets. Local meats were processed and sold through an onsite store.
She became chief executive officer and principle shareholder in the new company, working alongside general manager Pat Donato, plant manager Lorri Dickert and about 50 employees.
Kingsley-Hu came from Goderich, a large farming community and although she did not have a farm background, she knew business.
She worked as a financial adviser for 10 years, and was used to abiding by strict regulations.
She is willing to work with the Canadian Food Inspection Agency regulations and was already accustomed to Chinese bureaucracy. She also speaks Mandarin.
“When I came here to deal with HACCP (hazard analysis critical control points, a food safety system) and deal with CFIA, I just looked at them and said, ‘tell me what to do and I’ll do it.’ ”
“I am a bit of a maverick and I don’t come from the meat industry. I think there is a bit of a disconnect. I am trying to do things differently.”
Golden Ontario obtained approval to sell frozen, chilled and bone-in products to China last October. The first Chinese shipments went out in March. The plant is also approved to ship to Hong Kong, Vietnam and Dubai.
Although China had agreed to accept Canadian beef under specific protocols, she found uncertainty and communication problems between the Chinese and Canadians.
“There was really no push by anybody,” she said.
“China is one of those countries where unless you ask, they are not going to do anything.”
It took time to bring everything together.
She met Donato in 2013, who came on board as plant manager and eventually became a business partner. He had owned a provincial plant and understands the butcher’s trade.
The plant is licensed to handle cattle, lamb, venison and water buffalo and she has worked in every department from the kill floor to the chief executive officer’s office. She wanted to know what she was doing throughout the chain.
“No one tries to market the whole animal to the Chinese,” Kingsley-Hu said.
“We sell it as boxed beef but we cut it for our clients’ needs, not for what they were used to getting.”
Regular trips have been made to China to work directly with clients to understand what they want.
The Chinese have a list of drugs they will not approve and ractopamine is at the top of that list.
No offal products are permitted and the beef must come from animals younger than 30 months. Checking for permanent teeth is preferred over birth certificates.
The plant processes 100 head per week but plans are set to handle 200.
The products carry the Golden Ontario Products brand and are directed to restaurants and some food service.
Ten containers have gone out since March but production has stepped up and two containers were ready to go at the end of August.
Containers are shipped through Vancouver to a southern port near Hong Kong, where the beef is further processed.
The company has set up a program with about 10 local farmers and offers five cents a pound more for age verification and being ractopamine free. There is also a premium for AAA and Prime carcasses.
Information on grades and yields is collected and evaluated. A carcass may grade AAA but the red meat yield is often around 50 percent so they are talking with their suppliers to consider providing Angus-cross cattle to bump up the yield while maintaining the marbling.
The cattle are on a mixed grain ration because corn produces a yellow fat and the Chinese prefer white.
The biggest constraint is labour.
Golden Ontario has about 50 employees but more workers are needed to increase capacity.
They try to pay above minimum wage and offer fair benefits but filling the jobs is a challenge.
Donato said there are fewer active butchers in their area so they train staff in the art of meat cutting and also include training in the style the Chinese want.
“There is a very limited amount of skilled butchers of any age so I made the hard decision and said we are going to put in a youth program where I designed and wrote a program for the kill floor,” he said.
Kingsley-Hu said in China, pork and chicken are combined with many dishes and she is suggesting they substitute beef.
“The culture is that every dish they eat has meat in it, even if it is a little bit. We want to get into that little bit,” she said.
Food fraud and smuggling are rampant in China so each Golden Ontario box is sealed and each piece in the box of meat is labelled. It carries a guarantee that Golden Ontario killed the animal, cut it and shipped direct to the customer.
The aim is to build a reputation as a reliable and quality supplier.
A key part of marketing to China is regular networking, she said.
Kingsley-Hu sat on the Canadian chamber of commerce in Shanghai and has participated in trade missions.
Most recently, she went to Italy with Prime Minister Justin Trudeau to make contacts and apply to become a European Union-approved plant.