It’s time for the province to support Alberta’s cattle ranchers by loosening the stranglehold of the “big three” meat packers. 

Loosening the Stranglehold of the Packers

• There are only three packing companies: Cargill, Lakeside, and XL foods; these packers owned 13.4 % of the cattle in Alberta in 2003.
• The three packing companies process at least 90% of the cattle slaughtered in Alberta ( Auditor General Report on BSE assistance July 27,2004)
• These three packing plants have received over $12 million in grants from 1987 to 2000.
• From 1992-1995 Cargill received almost $2.5 million of the $12 million in grants. (Alberta Government Public Accounts Grants Books)
• These three packing companies received $45 million of the $400 million in compensation funds.

The Alberta Liberal Plan

The Alberta Liberals believe there is an alternative by supporting Alberta entrepreneurs:

• An Alberta Government should provide infrastructure for water, roads and land to help get small packing plants off the ground.
• Appoint a “beef czar” reporting directly to the Premier– an Albertan with an ear to the ground in the cattle industry, the environment, trade and the needs of local authorities – instructed to move the industry forward.
• Set a 10 per cent cap on the slaughter of the big three coming from their self-owned herds.
• Restrict market share and control of Lakside, Cargill, and XL Packers until healthy market conditions return.  This may require capping processing capacity of these companies and placing a moratorium on the purchase of Alberta-based processing companies.

The Existing Environment

• The Alberta Government forced the Tender Beef Co-op to establish its plant in B.C. due to bureaucratic red tape.
• The Tender Beef Co-op in Alberta ran into land purchasing and provincial support problems with its original location in Beaverlodge, Alberta.(Herald Tribune Grande Prairie Aug 30/04)
• The Government of B.C. lured away the packing plant and the 60 full time jobs from Beaverlodge when they offered land, 15 acres of low cost city property and a government promise to help remove any obstacles in development.
• There are groups starting packing plants across Alberta; we should support them and the jobs they create instead of forcing them to other provinces offering a better business environment to ranchers.

Capping the Lakeside Cargill and XL Foods Plant Operations

• Alberta currently has no legislation to cap the size of the herd that packers can own.
• Cargill has bought up a packing plant Caravelle in Spruce Grove this is not helping diversify the sale of beef and therefore allows the big 3 packing plants to control even more of the beef market.
• Lakeside is planning a large expansion to its plant in Brooks which will further consolidate ownership of cattle processing among the big 3 packing plants.

Packers and the Necessary Controls

• A 10% cap would allow packers to always have stock on hand for processing, however, not enough to control the market price of cattle by flooding the markets.(Approved by the Alberta Cattle Feeder annual meeting) (Source The Western Producer March 4/04)
• The distinction of the 10% of the slaughter rather than the size of the herd insures that packers are processing 90% of cattle owned by Albertans out of their total monthly amount.
• Albertans require legal protection from packer monopolies similar to the U.S. in order to support a strong open economy in the trade of cattle.
• In the United States, the 1921 U.S. Packers and Stockyards Act protects livestock and poultry producers by prohibiting monopolistic or predatory practices that force sellers to accept lower prices than would be available through free competition.

Control in the Market

• The BSE Crisis has demonstrated we cannot have all of our focus on the U.S. and we need to seek out new markets for the high amount of product we have to export
• Canadian Beef exports of $633 million to the United States were down just $78 million ($711 million) for the same market period (Jan to May) 2004 over 2003. (The Western Producer August 26/04)
• Total Canadian beef exports were down a total $72,584,698 in 2003 due to an increase in sales to Macau, Poland, Philippines, and the Caribbean. (The Western Producer August 26/04)
• The value of Canadian beef exports remained surprisingly strong during the BSE crisis; significant questions remain on how Alberta ranchers were hit so hard while large processing companies saw profit rise by over 280 per cent.
• “The frustration is that had we have been self sufficient in processing capacity coming into this, Canada would by–and–large have recovered from its BSE cattle price crisis,” Ted Haney, Canadian Beef Export Federation.
• The Alberta Government needs to support increased research into all markets along with the development of the new packing plants so that we can have demand for the product before it is completed.

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