Everything’s kosher with beef producers in southwestern Manitoba.
Farmers here will have a local market for over 600 cattle a day thanks to an Israeli company that is spending $20 million to transform the abandoned Burns plant in Brandon, Man. into a kosher meat processing facility.
It’s all due to Israel’s upper class having acquired a taste for Canadian beef, said a spokes-person for Carvell Trading Limited.
“With the sophistication of Israel they’ve traveled abroad and tasted Canadian and U.S. beef and now they’re demanding that quality,” said Harvey Davis.
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Israel used to buy beef from Argentina, but the demand for non-grass fed North American beef surged recently with the expanding “nouveau riche” market in Eastern Europe who can afford the premium product, he said.
The company plans to export most of the meat to Israel, Eastern Europe and Russia. Supply agreements are already under negotiation with the Palestinian Authority and other Arab states, Davis said.
At full capacity, the plant will handle $170 million in exports annually. Renovating the building will take at least 18 months, he said.
Kosher meat is prepared according to Jewish ritual law which requires the animal to be cut up the front and bled to death rather than being stunned before the kill. Only the front part of the cow is used, and the meat must be blessed, soaked, salted and all traces of blood removed under religious supervision.
Carvell will also produce halal beef, required under Muslim law. Halal products are prepared using a similar ceremony but the entire animal can be used.
Halal and kosher meats fetch a 20 percent premium over regular grades, Davis said.
The announcement means 250 new jobs for Brandon. Only the Jewish and Muslim religious slaughterers will be brought over from Israel.
Brandon’s business lobby has been courting the deal for three months.
The city has been looking for a new tenant for the plant in the city’s north end for seven years.
Don Allan, of the Brandon Economic Development Board, said the group invited representatives of the Israeli company to visit Brandon after hearing it was considering building a plant in Winnipeg.
Some encouragement
The Brandon Community Development Corporation will provide Carvell with a $169,000 forgivable demand mortgage on the property if the plan goes through.
“It gave Carvell the sense we really wanted them here,” Allan said. “We invest that and it leverages $20 plus million and over 250 jobs for the community.”
Rick Wright, manager of Heartland Livestock in Brandon and president of the National Livestock Markets Association, said the company will be up against some stiff competition from Cargill, IBP and Western Canadian Beef based in Moose Jaw, Sask., when it enters the market.
“They’re not going to give up cattle that easily,” Wright said. Seventy percent of the slaughter cattle in this region are sold into the United States, he added.
But more competition is good news for producers, said James Bezan, a consultant with IBG Global Livestock in Winnipeg.
“It may be a difficult slug for Carvell in the beginning and that could drive prices up because we’re talking about another major player,” he said.
While Carvell will compete with the big players to buy cattle, Peter Gall, a consultant working for Carvell, said the company won’t be going head to head with its competitors on the sales end.
“You can’t go up against Cargill and you can’t go up against IBP so what you have to do is be an exporter and look for niche markets,” Gall said.
