Business & Policy
A Brighter Future
By Dan Woolley
Optimism is high amongst N.S. and P.E.I. poultry industry
By Dan Woolley
After several years of dark uncertainty for Nova Scotia poultry
producers, brighter times appear to be ahead with the July 14
announcement of a $46-million poultry processing plant scheduled to open
in 2012 in Kentville, N.S. in the Annapolis Valley.
After several years of dark uncertainty for Nova Scotia poultry producers, brighter times appear to be ahead with the July 14 announcement of a $46-million poultry processing plant scheduled to open in 2012 in Kentville, N.S. in the Annapolis Valley.
The processing sector of the Nova Scotia poultry industry has gradually but relentlessly shrunk in recent years. In 1998 Maple Leaf Foods stopped turkey processing at its Annapolis Valley plant, followed by its complete closure in April, 2007, leaving about 45 per cent of the chicken farmers in Nova Scotia and Prince Edward Island without a processor.
|Processing To Resume. After several years of uncertainty for Nova Scotia poultry producers, brighter times appear to be ahead, with the July 14 announcement of a $46-million poultry processing plant scheduled to open in 2012 in Kentville, N.S. in the Annapolis Valley. |
Photo by Carroll McCormick
Then in January 2009, ACA Co-operative Ltd, citing losses of millions of dollars in 2008 and preceding years closed its Eastern Protein Foods subsidiary. ACA also said at that time it lost $6-million in 2008 at its main plant in New Minas.
By early March ACA had laid-off 302 union and non-union workers, half of its work force. Even with the cessation of its tray pack production at New Minas; ACA laid off another 96 workers in December 2009, with further processing cutbacks that saw ACA killing and chilling just half of its intake of birds and then shipping the carcasses to Nadeau Poultry in St-Francois-de-Madawaska, New Brunswick for final processing, along with its remaining intake of live birds.
Early in 2009, Ian Blenkharn, ACA chairman and CEO, announced the cooperative would discuss with Maple Lodge Farms, the owner of Nadeau, “a long-term solution,” for Nova Scotia poultry processing.
That solution evolved from over a year of discussions between Maple Lodge and the Nova Scotia Poultry Industry Strategic Planning Committee. Blenkharn, who also chairs the committee, composed of six poultry farmers, said it coalesced in the fall of 2008 as an initiative of Nova Scotia’s chicken and turkey farmers, “with a mandate to come up with the industry’s solution for the marketing and processing of poultry in Nova Scotia.”
After Maple Leaf closed its Canard plant and ACA then reduced its processing activities; more Nova Scotia poultry headed up the Trans-Canada highway to Nadeau’s plant.
In a joint press release with the strategic planning committee, Maple Lodge CEO, Michael Burrows, declared, he expected the $46-million joint venture with the poultry farmers will “ensure the long-term viability of the poultry industry in Nova Scotia and will benefit the farmers of both Nova Scotia and P.E.I. through ownership in the plant.”
The press release also stated the deal between Maple Lodge and the producers also recognizes the “need to have Nova Scotia chicken and turkey processed in a Nova Scotia plant.”
The press release also claimed the 50/50 joint venture between the processor and producers was “unique in Canada,” as the farmers have committed to ship their birds to the new plant, while Maple Lodge will provide “much-needed national marketing reach” for their final products.
Maple Lodge, Canada’s largest, privately owned poultry processing company, has processing plants in Brampton and Etobicoke, Ont., at Nadeau in northern New Brunswick and a hen processing facility in New Market, Va.
As chairman of the poultry industry strategic planning committee, Blenkharn said the agreement with Maple Lodge “brings stability to both the farmers and the employees in the industry.”
The new joint venture, known as Newco, short form for new company “because we don’t have a name for it as of yet, “ says Blenkharn, “we will leave it to our producers to come up with a name for it.”
The new plant, to be located in the former Eastern Protein Foods facility, will have economies of scale, efficiencies and room for growth the previous and current processing facilities in Nova Scotia never had, with a capacity to process 12,000 chickens per hour as well as 2,500 turkeys hourly, with extra capacity to also handle P.E.I. chickens, Blenkharn says. It will function on a single, eight-hour shift, five days a week.
The new plant will have 50 per cent more processing capacity than ACA’s current New Minas plant which will close when the Kentville facility begins processing in 2012.
It will employ about 200 people, says Blenkharn, remarking, “We have a lot of work to do. The next four to six months will be spent on finalizing blueprints and putting the proposal out to tender, building permits. . . .”
The exact number of producers who will partner on the joint venture has yet to be determined, he says, noting copies of the project’s business plan have already been sent to producers who will then make the decision on whether to participate.
Tim Ansems, a chicken and turkey producer in Port Williams in the Annapolis Valley agrees that stability is important to his industry. “There has been turmoil for a couple of years
. . . now this is a good opportunity to solidify jobs and I know I will have a place to process my poultry. If there is no processing; there is no industry. Look at when Avon closed the pea and bean plant in Berwick — that industry disappeared.”
Ansems is chairman of the marketing board: The Chicken Farmers of Nova Scotia. His counterpart for turkey, Dave Young of Bridgewater, chairman of the Nova Scotia Turkey Producers Marketing Board, believes the new Kentville plant will improve the bottom line of producers in his industry. “Yes, all indications are it would benefit the industry in Nova Scotia and P.E.I.”
As for the joint venture improving the profitability of regional chicken farmers, Lindsay Steele, who chairs the Chicken Producers Association of Nova Scotia, states: “I hope so. That is the plan.”
Any joint venture shareholders will receive dividends, she observes, commenting, “I can’t see how any joint venture wouldn’t be profitable.”
ACA, Steele says, is now making a profit following its cutbacks. “I expect great things for the future of the industry here.”