At the time of writing last week the fate of the XL Foods beef plant in Brooks was still undetermined. By now it may have reopened or may still be closed to buying new cattle.
Either way, there is a genuine concern in the industry that XL Foods may not have the financial willingness to keep the plant going if it reopens. The recall alone will cost millions, the inevitable lawsuits could cost millions more, and meat buyers will want to extract significant discounts to again be interested in buying XL beef. One hopes XL has solid liability insurance, or it may be forced out of business. If financing the losses becomes a problem you can expect the Alberta government will be asked to prop up the plant. It’s just too large to fail.
From an interview done with co-CEO Lee Nilsson by Alberta Farmer reporter Sheri Monk, it’s clear there are major differences of opinion between XL and the CFIA as to what occurred to cause the closure. One fears that challenging the CFIA will only worsen the situation and cause further delay in opening the plant. If that happens massive worker layoffs will continue and slaughter cattle marketing in the province will be in chaos. I expect that every available livestock liner in Western Canada is already fully booked for an indefinite period of time just to ship cattle south.
Rumours continue to swirl that the XL plant is up for sale or lease and the present owners are just waiting to have their operating licence reinstated by the CFIA. That may be the only way for this disaster to be resolved. Cargill is the likely candidate but can only lease the plant due to competition rules. That leaves JBS as a possible white knight to buy the company. A new operator may be the only way to overcome the acrimony that appears to exist between XL and the CFIA.
One had hoped that with the PR damage to the iconic and world-famous “Alberta Beef” brand and the impending cattle-marketing disaster, that our provincial government would be taking decisive and inspiring steps to support our cattle and beef industry, one of the traditional pillars of the Alberta economy and culture. But to the dismay of many in the industry, the Alberta government response to date has been to engage in mindless media photo events with the Premier in boots and jeans on a ranch and the agriculture minister buying a package of beef, all the while expressing their support for our cattle producers. If this is the best our government can do we really are in big trouble in agriculture in this province. Let’s hope the media photo events are just for the consumption of gullible city folks, because producers are not fooled.
Where was the CFIA?
Industry sources indicate that meetings of every sort have been going on between producer groups, industry stakeholders, processors and governments for several weeks to discuss every scenario in this evolving situation. What is becoming clear is that notwithstanding the responsibility of XL in this matter, most fingers are pointing to the CFIA as a major cause of the plant closure. Questions continue to be asked as to why so many CFIA inspectors and veterinarians working at the plant seem not to have noticed the growing E. coli problem. How come it took the USDA inspection service to identify the problem first?
The XL case screams for a complete and formal investigation of the role of the CFIA and XL in the outbreak. Clearly something went very wrong, particularly as it appears the company and the CFIA are locking horns as to what happened and what needs to happen. One could speculate that the future of the present ownership of XL may well be influenced by a fear of retaliation by the CFIA on the economic operation of the plant. When egos, control, power and emotion get involved almost anything is possible.
For the Alberta cattle and beef industries’ sake a formal investigation is exactly what is needed to clear the air and restore confidence in “Alberta Beef.” It’s what the industry expected the Redford government to demand from the beginning, but alas that is not forthcoming. The premier recently stated that there is no need for a formal investigation of the situation every time something goes wrong. One shudders at the audacity of such a statement. What then will move this government to investigate such a situation? Do hundreds have to die? Do producers need to start shooting cattle they can’t sell? Do 30,000 producers need to march in the streets?
The government could have done itself well politically, if it had shown some leadership in this case.
One fears that without a formal investigation the issue will fade away, which one suspects is the real hope of government politicians. An investigation could expose shortcomings in the CFIA inspection system which would only prolong the political agony, since food safety issues are something politicians see as a kiss of death.
Ironically there is some hope. The USDA has announced that it will be auditing the CFIA inspection process at the XL plant. It’s a rather sad situation that a foreign inspection agency will go where our own government politicians fear to tread.