Restoring meat packing capacity critical: beef producer

If meat processing not restored consumers will face soaring prices and grocery store shortages

Beef producers face ruin and consumers could get hit with sky-high prices and meat shortages if Canada’s packing plants cannot be restored to full production, says a Trochu-area farmer.

“I don’t think the consumer and the general public realizes the ramifications this is going to have right through the food supply,” said Charlie Christie, who has about 700 cows on his farm 10 kilometres east of Trochu and runs an 800-head feed lot, where 600 cows from other producers are fattened up.

“If we can’t get these plants up and running, consistently and steadily and at a meaningful rate, we are seriously going to see some shortages. The math tells the story,” he said Tuesday.

Pork and poultry producers will face the same issues if their plants are forced to close or cut back operations because of COVID-19.

“We’re also seeing challenges with dairy and challenges with some of the distribution systems for vegetables as well.

“I think North America is in for a bit of a rude awakening when this thing filters through. You are already seeing the prices rising exponentially in the supermarkets.

“We have the product. We can’t get it processed. That is the key problem.”

Christie questions whether the government understands how bad the situation could get.

“If they do see it, they’re taking their sweet time doing something about it,” he said of government financial help efforts, which one industry player called being handed a pail of water when your house is on fire.

Prime Minister Justin Trudeau announced Tuesday more than $77 million will be provided to help keep workers in the food-processing industry safe.

The news comes as a Cargill meat-packing plant in High River, south of Calgary, reopened Monday after a two-week shutdown due to a COVID-19 outbreak. More than 900 of its 2,000 workers have tested positive for the novel coronavirus.

There are also outbreaks at the JBS meat-processing plant in Brooks, which has reduced production to one shift per day, largely due to absenteeism, and at Harmony Beef just north of Calgary.

There have been no reports of COVID-19 in Red Deer’s Olymel pork processing plant. That facility, like others, has implemented new safety measures, including the use of masks and the installation of barriers and the use of portable trailers to create more space for worker breaks to ensure social distancing.

Christie understands the concerns of workers and praises the work of Alberta Health and Alberta Occupational Health and Safety to keep the plants operating safely.

But plants have had to cut back their processing speeds and capacity to meet health regulations, which is backing up the beef system to the tune of 6,000 to 7,000 head a day, he said.

Christie said if producers start losing key parts of the processing system now, it will have long-term ramifications for the industry that will not be easily fixed.

“It’s like a domino effect. That’s the scary part. We’re trying to stay ahead of the curve, but the curve is rapidly overtaking us.

“As is with everything with government, it takes too damn long, and when they finally realize that everything we were saying was, in fact, what’s going to happen, then usually, the wave has overtaken you.

“We have to figure out how to get these animals processed.”

Trudeau’s $252-million agricultural aid package also includes another $125 million for the AgriRecovery fund, a federal-provincial program aimed at helping farmers during disasters. Another $50 million has been set aside to buy surplus food to distribute to food banks.

Canada’s dairy industry has seen a government-backed line of credit extended by $200 million to allow for more stockpiling of products to avoid milk dumping and other similar measures.

Lacombe-area dairy producer Albert Kamps said the industry association asked for that help because dairy product storage is already at capacity, and there is a concern that when restaurants reopen, there will be a sudden surge in demand.

A big jump in demand would be difficult for the industry to meet immediately, because dairy farmers have reduced production because of COVID-19 restrictions that saw most restaurants temporarily closed. The Canadian Dairy Commission cut quotas by three per cent retroactive to March 1.

“That production is tough to bring back at the farm level once it’s gone,” Kamps said.

It will likely take months for the industry to get back to former production levels. But how long it will take will depend on what sort of regulations are in place for reopening restaurants, how much they have in inventory and how quickly eateries begin to recover.

How hard hit dairy producers will be will vary from operation to operation, said Kamps.

“Some, of course, are on tighter margins than others. I’ve been in business for many years and it doesn’t affect me as much as some others who have just started out.

“It’s definitely going to cut into margins. And for some, that will mean closing up shop.

“We do lose about three or five per cent of our dairies due to natural attrition, and that may be accelerated by this.”

— With files from The Canadian Press

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