(Saskatoon) – The National Farmers Union is reminding policy makers about its analysis of the beef sector, including 16 recommendations outlined in our 2008 report, The Farm Crisis and the Cattle Sector: Toward a New Analysis and New Solutions. Problems related to the beef sector that we identified then have only become more severe.
News that E. coli O157-contaminated beef sold by the XL Foods plant has sickened people from Vancouver Island to Newfoundland, and that the USA and Hong Kong are now recalling beef produced at the plant, provides a clear message that Canadians need to re-envision federal meat inspection and food safety policies. We need to rebuild the system so that it works for farmers and consumers.
A good place to begin is by implementing recommendations outlined in the NFU report, such as:
- restraining packer power by reversing concentration and decoupling vertically integrated packers;
- tailoring food safety regulations to encourage local abattoirs that could serve markets in every region; and
- building collective cattle marketing agencies that will ensure an efficient, fair and transparent market for both buyers and sellers.
Federal policy focused on production for export has encouraged high through-put plants that compete by cutting costs and ramping up production. Most of Canada’s regional meat packers have shut down as the biggest companies grew via take-overs and by becoming vertically integrated. The Competition Bureau did not stop Cargill from purchasing Better Beef in Ontario in 2005, nor did it prevent XL from taking over the plant in Brooks, Alberta from Tyson in 2009, allowing these two companies to virtually corner the beef market in Canada.
Today XL and Cargill process well over 80% of the beef produced in Canada. Each company is able to exert control over the price of livestock. On any given day, they can decide whether to buy at auction, through contracts that allow the company to control both the price and the timing of slaughter, or in the case of XL, to just kill animals from its own herds. This is called a “captive supply” system. Nilsson Bros. Inc., owners of XL Foods, also owns most of the auction markets in western Canada.
The results? Cattle producers now have very few options when it comes to selling. Consumers have little awareness of how much of the beef they eat comes from just one plant, at least until the recall shone a light on the extent of XL’s market reach. Today’s highly concentrated beef processing sector makes both farmers and consumers vulnerable, while the pursuit of private profit takes precedence over protecting consumer health and public interest.
Canadians, including farmers, expect our food to be safe. We are saying that it is time for a national debate on the food system.
For more information:
Neil Peacock, NFU Board Member: (780) 228-9243 or (780) 833-6939 or firstname.lastname@example.org
Iain Aitken, NFU Member: (403) 843-0094 or email@example.com