Proponents of slaughter plants in Saskatchewan must enter into such ventures with their eyes wide open, said provincial agriculture minister Mark Wartman.
It isn’t enough to raise the money and put up a plant, he said after receiving a feasibility study conducted for the province by Mallot Creek Strategies Inc.
There has to be a guaranteed supply and a guaranteed market. Saskatchewan ships out 1.17 million head each year for finishing.
“This is not an easy field,” Wartman said in a March 7 interview. “The returns are low. You have to have your unique selling point.”
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That could be something like hormone-free beef, he said, or it could be on the processing side.
One example is Classic Meats’ New York Stick, developed by Fox Valley, Sask., farmer Lester Lodoen. This product is a pre-cooked hand-held meat snack made with Saskatchewan beef.
Wartman said the $55,000 study offers details proponents need to make decisions about how to proceed. Workshops are under way to help do that.
The study did not suggest that any of the existing proposals for plants in Saskatchewan are better than others.
“It notes that each of these may have some unique positive elements to them,” Wartman said.
The study notes the province would have to develop more feeding capacity to support additional slaughter, and that will be difficult given the market realities.
Any new slaughter capacity also has to compete against established packers, like XL Beef in Moose Jaw. XL is the only federally inspected slaughter facility in the province right now, but the other big players Ñ Tyson, Cargill and XL’s Calgary plant Ñ as well as facilities in the Midwest United States are all close enough to be competitive threats.
Wartman said this is the reality that new entrants in the industry will face, and they have to prepare themselves for that.
