Keystone Processors, a proposed cattle slaughter plant in Winnipeg, is likely dead because the federal government has backed away from its $10 million commitment to the project, says Manitoba agriculture minister Stan Struthers.
“My fear is that the project is dead…. All this work has been done and then the federal Conservatives pull the rug out from everybody’s feet. It’s amazing that any farmer still votes Conservative after seeing the kind of treatment that they’ve been getting from this government,” said Struthers, who learned the federal government was no longer supporting the project after people in the federal agriculture office informed Manitoba government officials of the decision yesterday morning.
The federal government announced in the fall of 2009 that it would provide a $10 million loan to help Keystone Processors refurbish a hog plant in Winnipeg to make the facility suitable for cattle slaughter.
Keystone Processors was planning to slaughter 250 to 500 cattle per day in a federally inspected beef slaughter facility in Winnipeg’s east end. The company intended to spend approximately $25 million to renovate a Maple Leaf Foods plant, using the federal loan, along with provincial funding and check-off dollars from Manitoba cattle producers.
The company wasn’t planning to compete directly with the major beef slaughter plants in Canada, as it was targeting the growing market for kosher and halal meat in North America.
“I’m as frustrated about this (decision) as I know cattle producers are,” Struthers said. “Slaughter capacity is a fundamental issue to be dealt with, if we’re going to have a sustainable, long term beef industry in Manitoba.”
As of yesterday, Struthers hadn’t spoken to agriculture minister Gerry Ritz to find out why the federal government pulled the funding.
But, Struthers speculated that Ritz is facing budget constraints.
“It could be that he’s under the gun to cut expenses in agriculture … but you’d be better off to ask minister Ritz the rationale that he’s used to pull this money off the table, because he certainly hasn’t stated a reason to us.”
The federal government announced the loan to Keystone Processors as part of its Slaughter Improvement Program, which is designed to improve existing slaughter operations and enhance capacity in regions lacking federally inspected plants.
Ritz said the federal government lost confidence in the project in the last 20 months.
“Since the conditional approval of funding for Keystone in October 2009, our department has conducted 10 separate reviews of its application,” he said in an e-mail. “We had expressed numerous concerns … and it was made clear that a strong, viable business plan was necessary in order to ensure an investment of federal taxpayers dollars.”
But after several deadline extensions, the federal government decided that Keystone Processors’ business plan “had not met the appropriate criteria to ensure the responsible use of taxpayers dollars,” Ritz added.
