Saskatchewan hog producers bought a prime cut of Saskatoon-based Intercontinental Packers last week.
SPI, the provinces monopoly hog seller, bought 16 percent of Saskatchewan’s largest hog slaughter plant.
The Fred Mitchell family retains majority ownership of the Saskatoon plant. Earlier this year Intercon entered a 10-year export partnership agreement with Taiwan’s largest exporter of pork, Tai Fang Foods, and acquired a new role as operating manager of Tai Wan Packers in Moose Jaw.
The Taiwanese company bought a controlling interest in the Moose Jaw operation while SPI holds a 15 percent share.
Read Also
August rain welcome, but offered limited relief
Increased precipitation in August aids farmers prior to harvest in southern prairies of Canada.
The three players now jointly control all the hog slaughter taking place in Saskatchewan.
John Germs, chair of SPI, told reporters and several hundred staff in the cafeteria of the Saskatoon plant, that the new relationship SPI will have as a shareholder in the slaughter industry will improve the future for producers.
SPI’s 2,200 Saskatchewan hog producers have also agreed to a five-year supply contract with Intercon. A new producer pricing formula, to be unveiled at the SPI semi-annual meeting in early November, will give hog farmers a competitive price relative to Alberta and Manitoba market prices, sources said.
Only two markets
The five-year deal will obligate SPI to deliver 82 percent of its weekly hog marketings to Intercon in Saskatoon, with the remaining 18 percent being supplied to Tai Wan Packers in Moose Jaw.
Fred Mitchell, of Intercontinental Packers, said Sept. 26 that “as we expand and provide a market for Saskatchewan grown hogs the producers, having an interest in the value-added industry, will be assured the same thing we have needed to expand – stability of supply and marketplace.”
Mitchell predicted the province’s hog herd will grow to 1.5 or two million by 2000, up from the current one million animals. Along with it, his work force of 1,040 will grow to 1,400, he said.
Plant expansion now under way in Saskatoon will allow Intercon to increase slaughter to two million animals per year, from the current 700,000.
“We will process as many hogs as can be grown in Saskatchewan,” said Mitchell.
