Olymel closure due to COVID creates costly backlog for hog producers

Backlog of hogs tops 100,000 and it will take weeks to work through it when plant reopens

More than one in four workers at the Olymel hog plant in Red Deer were infected during a COVID-19 outbreak.
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Red Deer’s Olymel plant remains closed following three deaths linked to the COVID-19 outbreak at the hog processing facility.

The plant closed temporarily but indefinitely on Feb. 16, and as of press time, it remained closed, with more than 500 confirmed COVID cases linked to the facility by Alberta Health Services. That’s more than a quarter of the plant’s 1,800 employees.

The shutdown prompted Olymel to declare force majeure — unforeseeable circumstances that prevent contract fulfilment. And even though the company is shipping pigs raised on its own farms to U.S. packers, a backlog is growing rapidly on Alberta hog farms.

“Barns are starting to get crowded,” Alberta Pork chair Brent Moen said on March 1. “Collectively, we would have marketed probably 100,000 to 110,000 head that are now backed up.”

Normally, Olymel would be processing around 45,000 head a week, but in the week prior to the closure, the facility was running at about 50 per cent capacity as a result of absenteeism. Since the closure, the plant has been undergoing a deep cleaning.

And while Olymel has moved “an awful lot of pigs south to get them out of the marketplace,” the backlog of hogs is going to take some time to work through,” said Moen.

“I would suggest that it’s probably going to take four to six weeks once they get back up in production to work their way through the backlog,” he said. “But that’s going to depend on how long they stay down.”

Other facilities, such as Cargill’s beef plant in High River, were out of commission for about two weeks following their COVID-related closures, he added.

“That’s consistent to what’s happened in some of the eastern plants when they had COVID outbreaks. That 14-day window (at Olymel) should be up this week, and I’m hopeful they’ll be able to get back into production.”

Until they do, though, producers are on the hook for these hogs.

“The reality is it’s costing hog producers money every day,” said Moen. “They’re putting more feed into pigs that should have been slaughtered in the last 14 days. That’s expensive.”

Alberta Pork is working with the provincial government to seek out financial support through the federal-provincial AgriRecovery program. That program was used in Ontario to provide support for increased feed costs to hog producers when plant closures forced them to keep more animals on the farm.

“The province is looking at it. They’ve obtained some information from Ontario as to what Ontario did in terms of subsidizing feed costs,” said Moen.

“It’s under discussion, and I believe they are working on a program, but it’s too early to speculate as to what exactly that might be.”

But given the already precarious position most Alberta hog farmers are in after back-to-back challenging years, support is needed sooner rather than later if the Red Deer plant remains closed much longer.

“I think most producers can get by for two weeks, but if they don’t open this week, we’ll have to start moving more animals out of the market. There’s no question about that,” said Moen.

“We need to get people back to work and work away through this backlog.”

About the author

Reporter

Jennifer Blair

Jennifer Blair is a Red Deer-based reporter with a post-secondary education in professional writing and nearly 10 years of experience in corporate communications, policy development, and journalism. She's spent half of her career telling stories about an industry she loves for an audience she admires--the farmers who work every day to build a better agriculture industry in Alberta.

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