JULY 2018 • COUNTRY LIFE IN BC


Prince George packing plant


gets further study Steering committee will review past work, future directions


by TOM WALKER SMITHERS – The possibility


of a larger scale, federally inspected beef processing plant for BC is getting a boost from the province with $450,000 to support further study.


BC agriculture minister


Lana Popham announced the funding at the BC Cattlemen’s Association annual general meeting in Smithers on June 1. “Bringing a federally


inspected beef processing plant to Prince George comes with so many benefits,” says Popham. “Eighty full-time, good-paying jobs by 2020, and up to 650 spin-off jobs.” BCCA general manager Kevin Boon says multiple opportunities would follow the plant’s construction, which is estimated to cost up to $27 million. “We see it as an


opportunity to grow not only the cattle industry but also the feeding industry as well as the grain industry,” he says. Boon cautions that the study is just the next phase in a careful planning process. “Don’t start buying fence posts to build your own feedlot yet,” Boon told AGM delegates.


The new funds will support an industry-wide steering committee that includes people familiar with cattle industry production levels and economics, as well as operating and building packing plants.


The steering committee’s job is to thoroughly question plans for the project. “We have told them we


really want to be challenged on this,” Boon says. “We have to have people at the table who will tell us when something won’t work. We don’t want a failure.” The committee’s first job will be to assess the three


previous studies and see if they should proceed to the next phase. “We started with a value chain market analysis,” says Boon. “We looked at what consumers in the Pacific Northwest want and what they are willing to pay more for.”


The work found that BC


product can demand a premium, as can beef free of hormones and antibiotics. Animal welfare is important to customers, but they’re not willing to pay more for it. The most recent study examined the viability of locating a plant in Prince George versus shipping cattle to Alberta. Prince George’s central location puts it within 700 km of producers, the range considered ideal given the economics of transportation. “This gives feedlots that are


already in the province more opportunity to fatten,” he says. “It will also support the growth of a larger feeding industry, likely in the Nechako area, and more feed grains to be grown in the Peace region.”


A business plan targets a daily run of 200 head or a total of about 50,000 a year. This is approximately a quarter of BC’s annual calf production, plus additional backgrounded animals. Adding value to the BC


industry is the aim of the new, local plant, Boon explains. The cattle industry in BC is really untapped for processing, he says. “We can get a significantly


higher return per whole carcass if we can process here and seek specialty markets both at home and in Asia, Europe and the Middle East for individual cuts, rather than exporting whole carcasses or selling all into the local market,” he says.


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BC Minister of Agriculture Lana Popham, flanked by BC Cattlemen’s Association general manager Kevin Boon (left) and incoming BCCA president Larry Garrett, made a funding announcement during the BCCA convention in Smithers in June. KAREN MCKEAN PHOTO


While a federal plant is


required for export, retailers in Western Canada also require it to move product across provincial lines, Boon adds. There are nine go/no go stages in the process. The first one will follow the


committee’s discussion of previous work on the project. By the end of August, if the


project is a go, they will take the concept to producers for feedback. The new funds will then support work on a governance model, with the


venture likely taking the form of a next-generation co-op. “We have an extraordinary amount of work to do yet,” Boon says. “But maybe put those posts for a new feedlot on order. I think this could work.”


Co-op model lets producers pocket profits SMITHERS – A federal beef packing plant


in Prince George may include foreign capital but it will not be owned by offshore investors, says Kevin Boon, general manager of the BC Cattlemen’s Association. “Retail and business interests across the


province are looking at being potential investors, but a key fact is that there is a lot of interest by producers themselves,” Boon notes. “Depending on how we build the governance structure, there is the possibility for producers to be significant shareholders.” A next generation co-op, which has seen success at an Ontario pork plant, is being proposed. “I don’t think it’s ever been tried in the beef industry,” says Boon. The co-op model would help build value


3


for the BC beef sector because any premium the plant’s products achieve will go back into members’ pockets. “Producer buy-in is certainly a key to this


project,” says Boon. “We need to have the commitment to deliver product to the plant on a year-round basis. If those who supply the plant are also investors, they have an opportunity to share in the profits.” The plant’s focus will be a BC brand, but it should be able to handle specialty items such as grass-fed beef, too. “With a 200-a-day production, that is a


nice size to cater to a specialty program,” says Boon.


A decision regarding the co-op model will come after the steering committee determines if the plant should proceed. —Tom Walker


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