NEILBURG, Sask. – The BSE crisis has sparked plans for at least 10 cattle producer-owned, meat packing plants in Saskatchewan.
All have hopes of opening in the next 24 months. Cattle industry experts say not all the plants will make it, but the crisis has spurred producers into riding up the value chain to protect themselves.
Saskatchewan’s northwestern corner may be home to more cattle than any other part of the province.
Producers there are hoping to take control of at least part of the beef food chain by opening a slaughter facility.
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They took a first step by holding a meeting March 6 in Neilburg.
Barb Campbell of the Big Gully Regional Economic Development Authority organized the event.
“I think they can see that it’s in their interest to take a stake in the processing of their cattle. They know that there is still money being made on the animals they sell and they would like to have a larger share of it,” she said.
Red Williams, president of Saskatchewan Agrivision Corp., an agricultural promotion organization, agreed with that point, asking producers “where were you boys for that 10 or 15 good years?”
“Unfortunately in agriculture it takes some tough times to consider working together to build something beyond your own herds.”
He said the meat packing industry is one of low margins, complex processes and tough corporate competition, but because producers can take a long-term view and can potentially profit at more than one point in meat processing, it may be possible for farmer-owned packers to succeed on the Prairies.
“Right now you have too many cull cows and bulls. You need to plan any slaughter plant you build to be flexible enough to turn to other animals and other markets when that situation changes,” he said.
Barry Harris of North Portal, Sask., in the province’s southeastern corner, is working with partners to create a business plan that would use a slaughter facility and system popularized in New Zealand.
“After (New Zealand’s) economic restructuring, producers there formed co-ops and companies and got involved in smaller scale, more flexible slaughter facilities,” he told the meeting. “They proved more efficient than the large facilities and are now a dominant force in the meat industry there.”
Harris and his partners in the South East Rural Resource Program Corp. hope to develop a business model and get Canadian Food Inspection Agency approval of the Miller Mechanical plant system this year. They also plan to raise the money by September to get on the one-year waiting list to have the New Zealand company build a facility.
“We hope that we can take our plans (and CFIA design approvals) and work with other groups to get their facilities started,” he said.
Keith Bater, a Saskatchewan Agriculture extension agrologist, said as many 45,000 of the region’s 300,000 cows are culled every year.
This would provide half of the number needed annually for an economically viable, small- to mid-sized plant, said Williams.
Harris said the type of plants he is proposing are small enough “to pass under the radar of the multinationals.”
Williams said plants of this size should consider joining with the larger players.
“In cow beef you should be making a deal with XL of Moose Jaw. They have done great work in establishing that market in Quebec. Why compete? Work with them.”
Harris said the flexibility of the plants is key to their efficiency and success.
“This type of operation can fill niche markets, handle identity-preserved products. Flexible enough to shut down, clean up and slaughter organic quickly and then even handle other species as some do with fallow deer in New Zealand.”
Williams said future rules for handling and transport of older cattle might force the domestic and regional slaughter of older cows and bulls, creating a captive supply.
Williams is former chair of the federal agriculture panel looking into the handling issue and said the “fact that Neilburg cows travel 1,000-1,300 miles to slaughter is a problem … it causes excruciating pain in some of these older animals and is not likely going to be allowed in the future, even if the (American) border opens to older animals again.”
Many of Western Canada’s cull cows are killed in Washington and Idaho.
Ian McNinch, an agricultural economist and Richard, Sask., cattle producer, also is a partner in the meat marketing company, Tee Creek Premium Meats, which targets the hotel, restaurant and institutional markets. McNinch relies on Edmonton’s primarily bison meat packer, Northwest Foods, to handle his slaughter.
“I’ve had calls from 10 different, small meat packers all planning to get going in the next two years, all wanting me to commit my slaughter to them. I tell them get up and running and I’d be glad to talk,” he said.
Glen Goodfellow, a Neilburg producer, said the road from a concept to kill floor may be “expensive and complicated, but the jobs and market stability it creates could be enough of a shove to get some of these local producers up to back it.”
He hopes to work with his neighbouring producers to establish a steering committee and then take the idea to other communities in the region.
