Canada West Foods has sold its 50 percent share of the lamb, veal and
pork processing operation in Innisfail, Alta., to its joint venture
partner, Trochu Meat Processors.
Canada West Foods will instead concentrate on growing its case-ready
meat business from its two processing plants in Chilliwack, B.C., and
Winnipeg.
“We just strongly believe there’s enormous growth potential that we can
capitalize on,” said Gary Haley, president of Canada West Foods Ltd.
Haley said more grocery stores are moving to buying boxes of meat that
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are already cut, packaged, weighed, priced and ready to be put in the
meat case.
Merchandising giant Wal-Mart has moved exclusively to 100 percent
case-ready meat, forcing other retailers to follow its lead. It’s
expected that 20 percent of the beef, 40 percent of the pork and 50
percent of the ground beef will be case-ready in the United States
retail market by 2003.
There are six case-ready facilities in Canada.
Canada West’s Chilliwack processing operation, built in 1997, supplies
100 Overwaitea and Save-On-Foods stores in British Columbia and Alberta
with case-ready packages of beef, pork, ground meat and sausage.
Its Winnipeg plant, built in 2001, supplies Safeway stores in Manitoba,
Saskatchewan and northwestern Ontario with case-ready meat.
The move to case-ready meats by grocery stores is simple, said Haley.
“It makes the retailer more money. It’s a more profitable and efficient
supply chain model than cutting in the backrooms of the store,” said
Haley, who compared it to car manufacturers shipping car parts to local
car dealers to assemble the cars on the lots.
Haley said having a single source that cuts and processes the meat
ensures a safer product. A lack of skilled labour is also a factor.
“Today not many young people go to school to learn how to be a meat
cutter. It just doesn’t happen so it’s very difficult for a retailer to
run a fresh meat program in store.”
Ray Price, president of Trochu Meat Processors of Acme, Alta., said it
plans to continue using the Innisfail plant to process specialty meats
like lamb, veal and Japanese-style beef for export.
“We really think it’s going to operate as it did before,” said Price
from the Sunterra Farms office. Sunterra Farms and the Price family own
Trochu Meat Processors.
“We don’t really see much change,” said Price.
Four years ago, Canada West entered a joint venture agreement with
Trochu Meat Processors. In 1991, Canada West bought the Lambco plant,
which was focused on processing prairie lamb.
Sunterra Farms is the farm side of the Price family business, which
raises cattle and hogs in Alberta. In 1990, the family bought Trochu
Meat Processors. The meat from their Sunterra Farms and from farms with
similar genetics is processed and most is exported to Japan. Some is
also sold through its five Calgary and two Edmonton Sunterra retail
outlets.
