Chicken farmers take wait-and-see approach

BY BRENT FOX

The Advertiser

NovaNewsNow.com



It’s too early to say what effect the impending closure of the Canard Maple Leaf poultry plant will have on local chicken producers.

The plant will close at the end of April, affecting approximately 380 workers. Chicken Farmers of Nova Scotia (CFNS) chairman Ian Blenkharn told The Advertiser Thursday, Jan. 17 that the situation poses challenges, but it doesn’t necessarily mean a reduction in flock sizes.

“It’s certainly a new challenge,� Blenkharn says, “but we don’t think that in the end it’s an insurmountable challenge.� He said the sector is resilient.

The chief issue right now, he said, is the situation of the 380 employees at the Canard plant. He acknowledged it’s a change, “but change doesn’t necessarily mean the end.� The hope is to continue to provide the public with a readily available supply of safe, quality chicken.

The sector is supply-managed, meaning that the national quota is determined every cycle of eight weeks and each province’s share of the production needed is allocated.

Nova Scotia produces about 45 million kilograms of chicken each year of the Canadian production of about a billion kilos. “We’re a fairly small player in the national scope,� Blenkharn said. But things are well structured on the supply side of things.

However, the loss of the Canard plant will come with about 50 per cent reduction of processing capacity. ACA Co-op may able to make up for some of that and some could be shipped to New Brunswick for processing.

Again, though, is the matter of market share of processed product, Blenkharn noted. Maple Leaf will still be selling in Atlantic Canada. But chicken has a very fluid market and “it floats back and forth across the country daily,� Blenkharn said.

The infrastructure is still here, he added. The eggs and chicks are still available, as are feed and grain.



Potential impact not yet determined

Following a board of directors meeting Wednesday, Jan. 17, Blenkharn said in a written statement, “as events unfold further, more information will be made available on the practical impacts the processing plant closure will have on Nova Scotia’s chicken producers.�

Blenkharn noted that Maple Leaf representatives met with the producers Tuesday afternoon, Jan. 16 to announce their decision. “The potential impact on Nova Scotia’s chicken producers has not yet been determined as it is still early in the process. The plant will continue to operate until the end of April, which provides time yet for decisions and discussion.�

Blenkharn pointed out, however, “our concern at this time is on the employees and families of Maple Leaf Foods and on the effect this has on them. The impact for employees is tremendous and should be where efforts are directed in the near future.�

Nova Scotia’s chicken production has 82 growers and is centered largely in Kings County. Maple Leaf buys from 36 local growers.



$40 million to upgrade

Maple Leaf poultry operations senior vice president Bruce McCullagh told The Advertiser that he’s confident the area’s chicken production will find another home at other plants. “I’m highly confident that the chicken will be processed and marketed in Atlantic Canada.�

The aim now is to do everything they can to ensure that as much processing as possible is still done locally.

The company buys from 37 Nova Scotia growers and six from Prince Edward Island.

“They’ve been great partners,� McCullagh said of the growers. Meanwhile, the company intends to have an orderly closure of the plant.

McCullagh said to make the Canard plant sustainable and viable, there would have to be a second shift to help process twice the current 250,000 chickens a week. To accommodate this, the upgraded facility required would cost $40 million.

He noted, however, that the company had invested in the facility over the years, including for food and health safety standards. The $40 million capital investment to replace the current half-century-old plant is another matter.

Closure costs will come in at about $8.5 million including for severance, decommissioning and asset write-downs.