Alberta beef producers are hoping the new owners of the former Rancher’s Beef processing plant in Balzac, Alta., will help strengthen and expand markets.
“This couldn’t come at a better time,” said Bryan Walton, chief executive officer of the Alberta Cattle Feeders Association.
Tyson Foods recently said it would no longer accept fed cattle from Canada at its plant in Pasco, Washington, because of uncertainty over country-of-origin labelling in the United States. It means fewer bidders for Canadian fed cattle, although Tyson said it would still accept foreign born cattle fed in the U.S.
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Rancher’s Beef, owned by Sunterra Farms, will be sold to Vesta Holdings, a Colorado investment company as of Nov. 1.
Company owner Rich Vesta predicts the facility could be open by next June, following $18 million worth of renovations, but he said it is not likely to function at full capacity of 800 head per day for some time. He did not disclose the selling price.
“We have a very disciplined apÂproach to how we start this plant up, and we won’t be in full production for the better part of a year,” Vesta said.
The plant has been inactive since Sunterra bought it from the receiver at the end of 2007.
Vesta said the facility is state of the art with no changes needed in the receiving or slaughter areas, but he wants to renovate the fabrication floor.
“It is as food safe a plant as there is in North America, maybe more,” he said.
The plant will be called Harmony Beef, and the brand will emphasize Alberta fed beef.
The company plans to pursue niche markets and achieve organic and European Union certification.
“We don’t intend to be a commodity beef producer.”
The company will start by producing commodity beef to test the plant and then shift to niche products. There is no plan to buy cattle until the middle of the first quarter of next year.
The plant is also adding technology to recycle water.
Vesta said the company is looking to hire 275 to 325 people to work in the plant.
Vesta has 47 years of experience in the meat packing business, starting as a meat cutter at the age of 14.
“I’ve run plants from 250 head to 5,500 head a day,” he said.
The Rancher’s Beef plant was built during a time when many groups wanted to construct processing plants to address the oversupply of cattle due to the lack of international markets after BSE was discovered in Canada. Few got off the ground, mostly due to lack of capital.
Rancher’s Beef raised $32 million from 47 producer investors, but survived for only 14 months.
Many Alberta cattle producers are already familiar with Vesta from when he was at Packerland Packing in Green Bay, Wisconsin, and later at JBS in Greeley, Colorado.
“He has got his feet on the ground,” Walton said.
“He is the real deal. Guys like this don’t come around every day that have had the experience and know how to make money and turnarounds at plants. He knows the business.”
Alberta Cattle Feeders chair Brent Chaffee said having another processor will benefit producers.
“Even if we are not directly selling cattle to him, if they are taking supply out of the market, that does drive up the bids a bit,” he said.
Alberta Beef Producers chair Doug Sawyer hopes the new plant will fill in markets not served by the province’s two major processors: Cargill at High River and JBS at Brooks.
He said the two large American-owned plants have not aggressively pursued the export of Canadian beef offshore because they can source beef for those markets from their plants in the U.S.
“Hopefully, they will be able to move into some different markets than we have been able to do with the two bigger plants,” said Sawyer.
