July 18, 2011

 

Canada upgrades hog plant instead of beef plant

 

 

Manitoba's cattle sector took a beating when Ottawa snatched CAD10 million (US$10.5 million) for a hog slaughter plant in Neepawa instead of improving a beef processing plant in Winnipeg, provincial Agriculture Minister Stan Struthers said Thursday (Jul 14).

 

Struthers said he has no issue with Hylife Foods in Neepawa getting the loan. It is the way the Harper government is turning its back on the province's beef industry that has him spitting mad.

 

"It is a dirty little trick the Conservatives have played on the industry," Struthers said. "They announce with big fanfare CAD10 million (US$10.5 million) for hog slaughter, which to me is fine, except that they have taken that money directly out of a cattle slaughter facility that we were working towards."

 

That money, announced in 2009, was earmarked for Keystone Processors Ltd to upgrade a beef processing plant in Winnipeg. The Manitoba Cattle Enhancement Council also announced a further investment of CAD7.5 million (US$7.8 million).

 

Keystone bought a former hog processing facility in 2008 and converted it into a provincially licensed beef processing plant. Ottawa's loan was to help Keystone bring the plant up to federal and EU certification standards and provide a shot in the arm for the beef industry, which at the time was still recovering from the BSE crisis.

 

Vic Toews, Manitoba's senior cabinet minister, then president of the Treasury Board, said at the time the money would help farmers benefit through stronger markets and create jobs. The federal loan was to come under Ottawa's Slaughter Improvement Programme, part of Canada's Economic Action Plan.

 

Struthers said many cattle farmers are under enough stress already dealing with flooding, including finding higher ground for their animals and food to feed them, without Ottawa undermining the industry. About 100,000 cattle have had to be moved.

 

"We have tried to work with the feds on this cattle slaughter facility, and they have just put the screws to ranchers in Manitoba," Struthers said.

 

In a statement released Thursday, federal Agriculture Minister Gerry Ritz said the money was yanked because Keystone and the provincial government, even after 10 separate reviews, had not submitted a viable business plan.

 

"It is unfortunate that minister Struthers is already engaging in election rhetoric at the cost of providing the facts to his producers and processors," Ritz said. "We have been in constant contact with minister Struthers, MCEC and Keystone over the past 21 months."

 

After numerous deadline extensions over nearly two years, Ottawa told the MCEC and Struthers their business plan did not meet the appropriate criteria to ensure the responsible use of taxpayers' dollars, Ritz said.

 

Struthers said it was more a case of Ottawa reneging on its promise.

 

"They have made this threat to us before," he said. "We have worked with them to make improvements to our business plan. We have dotted every one of their i's and crossed every one of their t's to get that done, and now this comes out of the blue."

 

He said the MCEC has been collecting a voluntary check-off of CAD2/head (US$2.09) from cattle sales to go toward the new facility, and the entire industry had been making decisions based on a new facility.

 

"Basic decisions were made and money was spent on the premise that the feds were going to be good to their word," Struthers said, adding he is doubtful the project can now go ahead.

 

Cam Dahl, general manager of the Manitoba Beef Producers, said Ottawa's decision should prompt the end of the CAD2 (US$2.09) fee so the money stays in the pockets of farmers.