The big guys never meant to slaughter the little guys in the Alberta pork price war raging in Alberta, according to a Fletcher’s Fine Foods spokesperson.
“We regret the impact it’s having on those smaller operations,” said Greg Whalley. “We are not in a real or significant sense competing with those smaller operators and view them as a very positive element of the pork industry locally.”
But Whalley said a shock like the price war might make small processors move to the same contracting system the large companies use.
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Gainers in Edmonton began the price war by offering bonuses above the going Alberta price for every hog brought to its plant. Fletcher’s matched every move by Gainers. As of Feb. 10, both companies were offering a $24 a head premium.
Susan Kastelen of the Alberta Meat Processors Association, which represents the dozens of small slaughterers in the province, is furious this price war is pushing small processors out of the business.
Whalley said no processor is happy about the pork war, which is costing the two major plants $1 million a week in bonuses alone.
“You don’t have to know a lot about our industry to know that isn’t sustainable for operators.”
Whalley said small processors should consider contracting hog supplies, as Fletcher’s and Gainers do, so they can avoid being crippled by future price wars.
“It points out the fact that if a strategic alliance had been in place even for these smaller players between themselves and their supply source they wouldn’t be at risk. It would not have had an impact on them.”
Since the Alberta government halted the provincial hog board’s single-desk selling, the big plants have been able to contract directly with producers. Whalley said this is essential for plants like Fletcher’s in Red Deer, because it can only be efficient if it has guaranteed supplies of 8,000 hogs daily.
