Delays in obtaining European Union certification have caused layoffs at Natural Valley Farms operations in Neudorf and Wolseley, Sask.
The slaughter and processing company announced April 19 it would lay off 56 employees in management and union positions, which is one-third of its workforce.
President Ken Piller said a custom contract to process 600 head per week for an EU customer was supposed to start in March but can’t until the certification process is complete.
He said it could take a couple of weeks to a couple of months until that happens. The plant was built to EU specifications and already has U.S. Department of Agriculture accreditation.
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“It’s all paperwork,” Piller said.
“There are no physical holdbacks. We’ve never had an EU plant certified in Canada. This is all kind of new.”
The company finalized its contract in December and built its marketing plan for this year around it. Because Natural Valley still can’t fulfil the contract it is spending two days each week processing its natural program cattle and the other three processing for the commodity market.
“That’s a place we never planned to be and don’t need to be,” Piller said of commodity beef. “There’s not enough margin there.”
He said the company’s natural beef markets are doing well.
He hopes employees will be recalled within two months and able to start work on the EU contract. The EU requires beef to be antibiotic- and hormone-free.
Piller also said the company continues to work its way through a plan to pay producers for cattle delivered to the plant before last October. In October, retained ownership was implemented and producers now own their animals until the meat is sold.
“We’re still working on it,” he said. “It’s a long, hard road.”
He added it’s not easy to lay off workers, especially when most are from the local area and are friends and neighbours as well as employees.
