Canadian Bailout Criticized

SASKATOON - Mar 30/05 - SNS -- Canadian livestock producers trying to move beyond crisis management into restructuring their industry by increasing domestic beef slaughter and processing capacity received nothing more than platitudes in the latest billion dollar farm aid package from Ottawa.

"Income support for farmers and ranchers is important, but it doesn't address any of the long term problems facing the industry," notes David White, General Manager of Natural Valley Farms. "The federal and Saskatchewan governments keep talking about the need to increase Canadian slaughter capacity, but that has translated into only limited assistance for producer-owned initiatives like Natural Valley."

Natural Valley Farms has about 50 investors and over 1,200 farmers have committed animals by renting hook space. Natural Valley will open a federally inspected beef processing facility at Wolseley, Saskatchewan in May of this year. A slaughter plant at Neudorf, Saskatchewan should be operational by September. The company has established markets for natural beef as well as beef from mature cows. Capacity will be about 1,200 animals per week.

In September of 2004, the federal government announced a Loan Loss Reserve Program to facilitate more rapid expansion of ruminant slaughter capacity. Natural Valley Farms is utilizing that program, but believes more should be done.

"The federal government recently announced a $50 million contribution to launch a campaign to expand markets for Canadian beef," notes White. "While welcome, that contribution is over ten years and does nothing to address the current shortage of slaughter capacity."

Meanwhile, the Saskatchewan government has provided no support or incentives aimed specifically at increasing slaughter capacity.

"If governments want to bring profitability back to agriculture and reduce the need for income support, they should provide some assistance for initiatives that are part of the long-term solution," says White.

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