If there’s one sure-fire aspect to the farm news game, it’s that the cattle and beef business can almost guarantee to be in the news on a weekly basis.
Part of that is the inclination of that business to repeat history. Of course, in Alberta, the cattle business is notorious for its Machiavellian politics — which is an endless source of news and stories.
Here are two stories that will cause longtime readers some familiarity.
Last week, an entrepreneur in Manitoba announced that he and a group of investors along with the usual government grants and loans would be expanding an existing small abattoir into a 1,000-head-per-week slaughter plant. The investment will be to the tune of $13 million.
The announcement came with the usual boiler plate about the need for a local processor that could serve both Manitoba cattle producers and local retailers. The implication always is that everyone will be making more money with a local plant.
It all sounds familiar, doesn’t it — wasn’t that the big plan for the defunct Ranchers Beef plant in Balzac?
It seems the dreams of producers owning their own cattle-processing plant never seems to die.
There was a time when Manitoba was a fairly large cattle slaughter location — up to 500,000 head were processed in Winnipeg and Brandon. But consolidation, plant closures, cattle numbers and a host of economic realities saw the cattle-slaughter business migrate to large plants in Alberta.
That might have annoyed cattle folks in Manitoba, but that’s the reality of the business. That same reality saw a massive chunk of the hog-processing business concentrate in Manitoba.
Only bits of that business still operate in other western provinces.
One wishes these entrepreneurs well, but the odds are stacked against them at both ends. Unless the plant is prepared to pay more for local cattle, they will go out of the province.
The precedent is that local producers in another ill-fated Manitoba co-op plant concept were not prepared to consign their cattle — in case higher bids were offered elsewhere. The other more severe reality is at the other end — getting a better price from local meat retailers.
Those buyers always promise to buy local, but become quite fickle when price becomes an issue. It’s the reason there are giant processors and small abattoirs and nothing in between.
Years ago, a small meat plant operator in the B.C. Peace River told me about the realities of competition in the meat business. He had built up a business serving small villages, oilrigs and construction sites up the Alaska Highway. He had that business because it was not efficient for the big dogs to service those niche markets.
He said he once tried to expand to grocery chains — but he was immediately slapped down by the large plants through massive discounting and intimidation. He quickly learned his place in the pecking order of the meat-packing business.
I expect the new Manitoba plant will learn that same lesson if they step into any big dog’s territory. The meat business is renowned for being ruthless.
Another bit of beef-industry news was the announcement that the federal agriculture minister was appointing a third party group to formally investigate the XL Foods plant E.coli fiasco.
My compliments to the minister for doing the right thing. The hope is that the investigation will be brutally honest and report on everyone’s role, particularly that of the CFIA. Hopefully, the group will have the courage to recommend significant changes in the inspection process and lay blame where it needs to be laid.
Investigations that don’t take those steps are not only useless, but become highly suspicious.
The announcement by federal minister Gerry Ritz probably caused some chagrin in the provincial ag minister’s office and also the premier’s.
During the height of the E. coli outbreak, Premier Redford, during a televised media event, stated that just such an investigation of the XL Foods plant was not necessary.
Will Verboven is the editor of Alberta Farmer.
— AHEAD OF THE HEARD