MCEC congratulates Plains Processors on Sod-Turning Ceremony

Winnipeg, January 28, 2012 - The Manitoba Cattle Enhancement Council congratulates Plains Processors of Carman, Manitoba for its continued progress on plans to upgrade its facility to become a federally-inspected beef plant. 

“MCEC is pleased to be one of the funding partners on this project,” said Kate Butler, MCEC’s Executive Director who attended the plant’s sod-turning on Saturday. “We’re delighted to be working with other investors and lenders as the plant finalizes its plans.”

As part of its mandate to strengthen the Manitoba beef industry, MCEC announced financing of up to $920,000 for the project in 2011.

“This is a positive initiative for the producers and the economy of this province,” said Butler. “It’s a smaller plant making progress on offering access to local and export markets for Manitoba producers. Over time our goal is to help develop a diverse, sustainable number of federally-inspected beef plants here in Manitoba. Plains Processors has been working very hard to advance this project. We came to the table early with terms that are tailored to the best possible outcome for producers in this specific project.”

The Manitoba beef industry will remain at risk of trade disruptions until the province becomes home to federally-inspected plants like this one. The 2003 BSE crisis and the more recent XL Foods closure both affected Manitoba producers more severely than their peers elsewhere. Both episodes are clear warnings of what can happen if Manitoba producers don’t have good, export-capable marketing options for their animals.

“There is a significant price differential between Manitoba and Alberta for the same animals and only part of that is explained by freight and other obvious factors. We need options,” said Butler.

MCEC is committed to being a catalyst to bring federally-inspected beef plant capacity to Manitoba, which is in keeping with the agricultural policy principles outlined in the federal government’s Growing Forward strategy.

“We need continued commitment from provincial and federal governments, as well as from producers and producer organizations, to support policies that can create a stronger, more robust beef industry,” said Butler. “If we work together, we can build a very strong, profitable, export-capable industry to protect producers and build profit here at home.”

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Time to re-engineer meat packing sector

A major US beef rancher lobbyist organization has sounded the alarm about the over-concentration of the meatpacking sector in the hands of only a few large companies.

R-CALF USA CEO Bill Bullard was quoted by AgWeek in September, 2011 saying that the disproportionate control over the sector by the five major beef and pork packers is creating a system that is “inherently more vulnerable to failures that could adversely affect the food safety and food security for millions” of consumers.

His comments followed a massive July, 2011 recall of meat products. Recalls are growing in size and can carry serious risks to human health. “When a problem at one major packing plant can disrupt the food safety and food security for millions of consumers, it’s time to reengineer our meatpacking sector,” he said.

Bullard said that the industry’s concentration gives the few remaining large packers “superior market power to lower livestock prices they pay to U.S. farmers and ranchers, which has forced hundreds of thousands of farmers and ranchers out of business.”

“R-CALF has highlighted a problem that is even more extreme in Canada where we have only two packing companies serving the beef industry,” said David Wiens, MCEC member. “Beef producers and government and other industry players need to do what they can to support a new regional plant in Manitoba. We should focus on creating an
environment where we have more diversity and more competition. That’s always a good thing.”

Canada-China beef trade reopens

China has agreed to allow imports of Canadian beef again, after a nine year pause due to the 2003 BSE crisis. The deal was announced during Prime Minister Stephen Harper’s recent trade mission to China.

The beef market in China has been soaring in recent years as the country’s economy surges ahead, boosting millions of its citizens into a new middle class that desires better food and nutrition options.

“This is potentially great news for our beef industry here in Manitoba,” said MCEC vice-chair Gaylene Dutchyshen. “We recognize we have to create new beef slaughter capacity here in Manitoba and have it export products to targeted international buyers.”

Last year, MCEC took part in a trade mission to China led by CentrePort Winnipeg. There is considerable interest from mainland China to find reliable, consistent sources of high quality protein such as Manitoba beef.

“It’s too early to celebrate, but this latest trade agreement is yet another sign that things are moving in the right direction for Manitoba beef producers,” said Dutchyshen. “We have excellent beef. We have CentrePort. And we have advanced plans for new federally-inspected beef plants to come on stream in the next two years. With all these elements coming together, I’d like to think we’re close to a very positive tipping point.”