Alberta cattle producers anxious over XL Foods’ closure

By Marty Klinkenberg, Edmonton Journal October 14, 2012

EDMONTON – Cattle producers with crowded feedlots are growing more anxious each day that XL Foods’ slaughterhouse in southern Alberta is shut down.

“It’s a tough time of year for this to happen,” Travis Toews, past-president of the Canadian Cattlemen’s Association, said Sunday from his ranch west of Grande Prairie. “Cattle feeders are looking for bids for processing, and there is some backup.

“What we need more than anything is clarity or some expectation of hope, but with each and every day there is more uncertainty. It is a pretty significant issue for the industry right now.”

Cattle farmers who have been fattening up their animals were dealt another blow on Saturday when 2,000 plant workers were temporarily laid off by XL Foods. The company’s processing facility in Brooks has been idle since its licence was suspended by federal regulators on Sept. 27, but appeared to be on the verge of reopening.

On Sunday, the firm announced it is recalling approximately 800 workers to assist with a safety review being conducted by the Canadian Food Inspection Agency. There is still no timetable for reopening the facility, which handled 40 per cent of Canada’s beef before its closure due to E. coli contamination.

“The sooner we have clarity about what is going to happen at the plant, the sooner everyone in the supply chain can make some adjustments,” Toews said. “Farmers can only hold cattle back for so long. They need to go to market at a certain point.

“If they are held on a feedlot too long, the cost becomes prohibitive, there are overweight issues and their value goes down.”

More than 1,800 beef products sold by XL Foods have been pulled from store shelves since Sept. 16 in what has become the biggest recall of meat in Canadian history. In addition, the company has temporarily lost its privilege to export to the United States, and faces legal action from some of the 15 people with related cases of E. coli poisoning.

Toews said cattle farmers that previously sent their herd to the Brooks slaughterhouse are now sending them to Cargill’s plant in High River, as well as to processing facilities in the U.S. Cargill, which already handles more beef than any other company in Canada, is looking at ways to increase production, including adding another shift, Toews said.

“We are seeing more cattle heading south and are having discussions with U.S. processors to identify their willingness and readiness to take on more product, but there are some challenges,” Toews said. “Before some facilities commit to taking on too much new product, they want to make sure there will be a large enough supply for a long enough time.”

On Saturday, Nilsson Bros., the Edmonton firm that owns XL Foods, blamed the layoffs on the uncertainty of when its processing plant would reopen. In response, the CFIA complained that the process of assessing the facility had become bogged down because of a lack of co-operation from XL Foods.

“That’s not a positive signal,” Toews said. “We are working in the interim to find other opportunities in terms of processing, but in the long term we have a critical need for the Brooks plant to be up and running.”

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Original source article: Alberta cattle producers anxious over XL Foods’ closure