Our September/October issue

September/October 2016

REPORT ON 2016 CBIC:

“ WE ALL JUST HAVE TO KEEP ON TALKING”

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IN THIS ISSUE September/October 2016

5 6 12 16 20 23

Global Meat Processing Equipment Market Growing and Growing...

The 2016 Canadian Beef Industry Conference: ‘We all just have to keep on talking.’

By Scott Taylor

Q+A with Dennis Laycroft

By Cam Patterson

Watch as the Trans-Pacific Partnership (TPP) Withers and Dies

By Chuck Jolley

Announcing the Beef Researcher Mentorship Program 2016-17 Participants Jarvis Appoints Sean Dougherty as Canadian GM

24 26 28 30 31 33

Pork Price Stability Appears to Be in the Rear-view Mirror

By Kevin Grier

Helping Consumers Make an Informed Choice

By Tom Lynch-Staunton, Issues Manager Canadian Cattlemen’s Association

Resetting Canada’s Main Agriculture Policy

By Mandy D’Autremont

New National Beef Cattle Check-Off Study Shows Increased Benefits Washdown-ready Equipment: Responding to the Modern Needs of Food Processors Tanka Buffalo Bars

By Cam Patterson

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GUEST EDITORIAL

September/October 2016 Volume 15 Number 5

PUBLISHER Ray Blumenfeld ray@meatbusiness.ca MANAGING EDITOR Scott Taylor publishing@meatbusiness.ca DIGITAL MEDIA EDITOR Cam Patterson cam@meatbusiness.ca CONTRIBUTING WRITERS Chuck Jolley, Kevin Grier, Tom Lynch-Staunton, Mandy D’Autremont CREATIVE DIRECTOR Christian Kent Canadian Meat Business is published six times a year by We Communications West Inc.

We Communications West Inc. 106-530 Kenaston Boulevard Winnipeg, MB, Canada R3N 1Z4 Phone: 204.985.9502 Fax: 204.582.9800 Toll Free: 1.800.344.7055 E-mail: publishing@meatbusiness.ca Website: www.meatbusiness.ca Canadian Meat Business subscriptions are available for $28.00/year or $46.00/two years and includes the annual Buyers Guide issue. ©2015 We Communications West Inc. All rights reserved.

The contents of this publication may not be reproduced by any means in whole or in part, without prior written consent from the publisher.

Printed in Canada. ISSN 1715-6726

GLOBAL MEAT PROCESSING EQUIPMENT MARKET GROWING AND GROWING...

According to Zion Market Research’s new report titled Meat Processing Equipment Market, global demand for the meat processing equipment market was valued at over 9.441 billion USD in 2015 and is expected to reach above 14.490 billion USD in 2021.

The meat processing equipment market report comprises forecasts and analysis of markets on a global and regional level. The study includes historic data from 2015 along with a forecast from 2016 to 2021 based on total revenues. The study provides drivers and restraints for the market along with the impact on the demand over the forecast period. The report also encompasses the study of opportunities that are currently present in the meat processing equipment market on a global level.

In order to give the users with the complete view on the meat processing equipment market, detailed competitive scenario, strategic development and patent analysis and product portfolio of key vendors are added. The competitive landscape in the market is well explained with Porter’s five forces model for the meat processing equipment market. Strategic development along with patents analysis and product portfolio is incorporated in this report. The study covers a market attractiveness analysis, in which meat type, equipment type segments are constitute based on their market size, growth rate, and attractiveness.

All the segments have been well studied based on current and upcoming trends and the market is anticipated from 2015 to 2021. The regional segmentation comprise the present and future demand for North America, Europe, Asia-Pacific, Latin America and the Middle East and Africa which is further split into major countries including Canada, the U.S. Germany, France, UK, China, Japan, India, and Brazil.

The report states that the high protein content of most meat products is driving the demand which results in escalating the growth of processed meat and meat processing equipment market. The major industries are replacing conventional machinery with the advance automated machines to overcome the labor cost, attain high productivity and improve the quality of finished products. This factor is likely to drive the meat processing equipment in the forecast period.

Moreover, meat is perishable so processing is the essential part to prevent it from deteriorating. This fact further stimulates the growth of this market.

However, high cost of equipment and complexity in handling the machines as compared to conventional methods is the major restrains for meat processing equipment market. Nevertheless, ongoing research from the key organizations for fully automated system is likely to offer new growth prospects to the market in near future. In addition, increasing demand from the emerging economics and investment of major players in the India and China for the processing plant is likely to open new opportunities in the near future.

North America and Europe are considered to be the most prominent markets for the meat processing equipment. Asia and the Pacific Rim countries are witnessing an unprecedented boom in meat consumption due mainly to surging discretional income from the emerging countries particularly India and China. Processed meat is gaining demand in Asia Pacific due to ease of cooking and great taste.

Latin America exhibits higher growth rate owing to changing preference towards the processed meat. Middle East and Africa are likely to experience sustainable growth in the near future owing to improving living standards.

For more information, visit www.zionmarketresearch.com

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September/October 2016 CANADIAN MEAT BUSINESS 5

THE 2016 CANADIAN BEEF INDUSTRY CONFERENCE: ‘WE ALL JUST HAVE TO KEEP ON TALKING.’

By Scott Taylor

For Brian Lemon, the inaugural Canadian Beef Industry Conference (CBIC) could not have been more informative nor could it have arrived at a better time.

“It was great, that’s really all I can say about it,” said Lemon, the general manager of the Manitoba Beef Producers. “It was just solid. The only complaint I heard was, ‘I didn’t get to see that speaker, because I was at this other session at the same time.’ And if that’s the only complaint you hear, I’d say that you’ve done a good job.”

The first Canadian Beef Industry Conference at the Grey Eagle Resort and Casino in Calgary back on August 9-11, 6 CANADIAN MEAT BUSINESS September/October 2016

was sold right out. But not only were all the spots reserved, those spots were taken by a diverse crowd of more than 650 producers, industry members and supporters of the beef industry from right across the country.

There was representation from all the beef producing provinces and a stunningly strong representation of young participants representing the industry’s future.

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According to co-chairs Virgil Lowe, a lawyer with Denton’s in Calgary and Rob Smith, the CEO of the Canadian Angus Association, “The conference featured a dynamic and broad-spanning agenda rich in ideas, knowledge, insights and inspiration for moving the industry forward.”

the people who run it are a very small group. This was a wonderful opportunity for everyone to get together and talk about everything in the industry. I thought it was ideal.”

For Smith, the co-chairs were given two primary objectives by the four Partners in CBIC -- Canada Beef, Canadian Cattlemen’s Association, Beef Cattle Research Council and the Canadian Beef Breeds Council -- and the general consensus was near-unanimous: The Conference delivered on every promise.

Looking back on the event, Smith believed everything that was accomplished resulted from strong support and a complete commitment to the endeavor.

“Our two primary objectives were to assist delivery of Canada’s new National Beef Strategy (launched in January, 2015) to producers and increase awareness and help create ‘The Meeting Place’ for Canada’s beef producers, supporters, value chain participants and thought leaders,” explained Smith.

Continued on page 8

STRONG SUPPORT AND A FULL COMMITMENT

“We knew we needed strong support from industry players and partners in sponsorship to ensure the event was both affordable for producers as well as created value for all

TWO IN ONE. SECOND TO NONE.

“I believe, inasmuch as we were hoping to ‘tell two friends who’ll tell two friend who’ll tell two friends… and so on and so on and so on…’ that the information delivered via CBIC will have a notable impact on cattle and beef production in Canada. I believe we met the two goals as they were cast to us and inasmuch as we had greater uptake than we expected, perhaps it is reasonable to suggest we exceeded these goals.”

For Lemon, a relatively new executive in the beef industry, the Conference delivered as much or more than he expected.

“I came out of ag on the federal government side, but on the grain side and cropping as opposed to livestock and ranching,” said Lemon.

“Being new to the business, it was just great for me to be able to meet the people in the industry from right across Canada.

“But it was a long week. My boss went in a week early and stayed right to the final session. The ag industry in this country is always adding a meeting. You come to these events and people say, ‘Oh, we’ve got these people together in one place, let’s make sure we meet.’ In terms of the vastness to the environment of the agricultural industry in Canada, meatbusiness.ca

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cattlemen in attendance,” Smith said. “The Partners each provided a substantial financial contribution at the outset and the amount of sponsorship obtained validated the Partners’ commitment. Further, as a bit of a ‘soft’ internal objective, we wanted to see more of the younger producers (under the age of 40) participating. I think one of the preeminent comments is that the satisfaction of this objective was noted by most everyone in attendance.”

It was certainly noted by a newcomer like Lemon. In fact, the one thing that impressed him most about the event was what he called, “the shocking presence of so many young people.”

“What really energized me about the Conference was the demographics,” he said. “We had a number of sessions for the Canadian Young Leaders and I was overwhelmed, frankly, by the number of young people in attendance. Make no mistake, a lot of this industry is grey-haired. I mean, these things are usually dominated by a large grey-haired crowd.

Remember, the average age in the ag industry is 55. I’m 53 and I’m on the young side of this industry.

“But at this conference I was impressed with the number of really young people. I was convinced, by the end of it, that the livestock business, is getting a lot younger. And there were also more women than I expected. That was good to see.

“Ultimately, it was hugely encouraging to see all these young people involved with the cattle industry.”

TWO IMPORTANT ISSUES Of course, when people in the industry leave a meeting like this, there are always going to be critical issues that they take with them. To his credit, Smith was not about to paint 8 CANADIAN MEAT BUSINESS September/October 2016

a picture that was all rainbows and fields of orchids. While the beef industry in Canada is, for the most part, prospering, nothing is a certainty, prices are indeed falling and there are always unforeseen problems around the next corner.

“Issue No. 1 for me is identified through the current political challenges of our American and British friends with respect to free trade,” Smith said. “Both CETA and TPP are under fire as a result of BREXIT in the UK and the US Presidential election. Americans on the speaker dais at the conference spoke unanimously of TPP’s broad benefits, perhaps even critically so, to the American economy. It will be interesting to see how both of these trade agreements evolve in the coming 12 months.

“Certainly through each of the pillar sessions, but even through all others, we heard a few words enough that they emerged as themes: The importance of people; respecting and incorporating youth; “We must tell our story;” balance; team play; science; and unity.

“So, for me, Issue No. 2 is that, ultimately, each of the sectors, or links in the national value chain, need profitability to ensure sustainability for all producers and processors at every level. The only way we accomplish this is by working together and toward mutually beneficial solutions.

“While this sounds a tad Utopian, it’s also true. And I believe CBIC, while easily negated as ‘simply three days in August,’ actually represents a significant catalyst to facilitating this form of collaboration and cooperation. Everyone was there.

Everyone talked. Everyone shared.

“Now we all just have to keep on talking.”

meatbusiness.ca

CONNECTING WITH CUSTOMERS Lemon, meanwhile, recognized one important issue that was on the minds and lips of many of the attendees: Public trust in the industry.

“It was clear to me that public trust was front and centre,” Lemon said. “It played itself out throughout the conference.

We must always be connecting with customers. We must make sure that the market signals up to the producers and then flows down to the consumers.

“I believe that if we could sell our message better to consumers, we would be in a much better position. And believe me, we have a great story to tell.

“It was interesting to me that Earls Restaurants was front and centre at this conference saying quite clearly how they want to work closely with our industry to deliver what their customers want.”

Co-chair Virgil Lowe was also thrilled with the inaugural conference and like Lemon, he believes the beef industry in Canada has a great story to tell.

“We have a lot to celebrate,” said Lowe who once operated his own farm in Northern Manitoba. “The momentum and strengthened connections established here will help drive ahead the National Beef Strategy and all of our interests for years to come. The event was also designed to be an

meatbusiness.ca

enjoyable event with a strong social side that people could build in around their summer vacation plans, and that was achieved as well. There were a lot of great discussions and strengthening of relationships that took place informally.

Already we have received a lot of feedback that this was a very positive event and step forward for our industry.

“I would add that another highlight is the confidence and optimism in the Canadian beef industry. Everyone from sponsors to registrants believed in our industry enough to take a risk and to come to something new, in times of falling prices, because they believed it would make our industry successful and they are driven to make our industry successful. In my opinion it is this attitude held by the people in the beef industry that will make it successful.

“The other initiative that I picked up from the conference was the strong support from a broad range of speakers and attendees to reduce duplication of efforts and enhance alignment within the industry around common issues,” Lowe added. “I think this is a key point of improvement for the Canadian beef industry and I think that the industry has shown that it is recognized as such from across its sectors.”

THE CBIC HIGHLIGHTS After the dust had cleared in late August, we asked co-chair Smith what he thought were the highlights of the conference.

Not surprisingly, he had trouble containing himself.

Continued on page 10

September/October 2016 CANADIAN MEAT BUSINESS 9

Considering that the CBIC exceeded expectations in registrations and sponsorship support, with more than 60 major sponsors contributing, as well as in proceeds raised through the Canadian Cattlemen’s Foundation Golf Classic, he had every right to be pleased.

“The conference will run annually for the short term, at least, which is a highlight in itself,” said Smith. “We believe CBIC has the opportunity to grow and create even more value for Canada’s beef and cattle producers. I think it will broaden minds and minimize isolation.

“Among the biggest ‘takeaways’ from CBIC 2016 is that ‘you are not alone’ and ‘we are all in this together.’ I believe participants felt this palpably and used CBIC to broaden and diversify their professional network. And when you have Earls Family Restaurants’ CEO, Mo Jessa, sitting in front of almost 700 people saying, ‘We made a mistake. And the next time we go to make a launch of a program for beef, you know that the beef industry will be sitting right there with us,’ you know there has been sustainable impact.”

Smith was almost overwhelmed by the attendance for this first conference. The organizers set a lofty goal and then exceeded it.

“I believe that, as we talked about our goal of attendance, we all thought 500 was a lofty but possible objective,” he said. “Some thought we were even high at that and held more to a 350-400 range. To reach slightly more than 650 full registrants, and to sell out a week before the event, was not at all expected.

“In fact, for Wednesday night’s dinner, we fed between 670 and 680 people. We did not, under any circumstances, expect that level of uptake. This was certainly a highlight, because it told us that the need for CBIC was very great.

The Partners were brilliantly prescient to believe the time was right to create this type of industry unity toward a single producer-based event.”

10 CANADIAN MEAT BUSINESS September/October 2016

Smith asked for and then underlined the comments he received from participants. He took every comment seriously and will take them all home, study them and try to make the 2017 event even better.

“Here are the highlight comments from our participants,” Smith said. “I’m particularly fond of the final one.”

1) “I’m used to knowing everyone I see at an industry organization event. There are way more people here that I don’t know than I do.”

2) “I’m from Alberta. I had lunch with people from BC, Saskatchewan, Manitoba, Ontario, Quebec, Nova Scotia, PEI and New Brunswick. Now that’s what I call a national convention.

3) “There was too much to choose from in the concurrent sessions. I guess this is a good problem to have.”

4) “The speakers were outstanding. The panel discussions really opened my eyes and challenged me.”

5) “Everything flowed smoothly and we never got behind.

Kudos to the organizers.”

6) “There were excellent displays from the sponsors.

I believe these businesses really care about our cattle and beef business.”

7)

“Thank you for including everyone from seedstock to cow/calf producers, through the cattle feeders, into the packers and through the wholesalers and retailers, including restaurants, always with a mindful perspective of the Canadian consumer of beef.”

“There were certainly a lot of highlights to my list,” Smith added, “In the end, however, this one is mine: Cattlemen traditionally do not come to events such as this. Technology or Information Transfer with cattlemen is a difficult objective to accomplish. But they came to CBIC, and they came in balance: men and women, old and young, farmers and ranchers, feeders and cow/calf producers. We had a thorough representation of every sector and they all seemed to find value in CBIC.” meatbusiness.ca

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Q+A WITH DENNIS LAYCRAFT

By Cam Patterson

When we had our last Q & A with Canadian Cattlemen’s Association (CCA) Executive Vice President Dennis Laycraft, it was shortly following his November 2015 appointment as the newly elected President of the Global Roundtable for Sustainable Beef (GRSB).

It was during that conversation that Laycraft had talked about his hopes for the then-upcoming Canadian Beef Industry Conference (CBIC). The CCA was working alongside industry partners in the months prior to the event to ensure the conference would be a success and by all reports, the inaugural event held at the Grey Eagle Resort and Casino in Calgary, AB in August did not disappoint.

The attention the mainstream media was giving the conference was an indication of the importance of this

event. There had been big news events leading up to the conference, namely the Brexit vote and its impact on the Canada and European Union Comprehensive Economic and Trade Agreement (CETA) as well as the Earls’ PR controversy.

Canadian Meat Business (CMB) had an opportunity to speak with Laycraft (DL) and get his thoughts and reflections on the CBIC. CMB: Overall, how was the inaugural conference received?

DL: It was pretty remarkable. You know we had a target of reaching 500 attendees in year one. It was a high expectation especially with organizations like the National Cattlemen’s Beef Association which over many years grew its annual conference from 5,000 to 10,000 attendees, keeping in mind that our industry is about 15% the size of the U.S. industry, so relativity speaking, that would put us around 700 to 800 attendees. I’m pleased to say we hit that milestone. It is one of the larger meetings that has taken place in our industry so yes, I feel really good about that.

We also had strong representation of young producers this first year, which also was one of our priorities when we were

12 CANADIAN MEAT BUSINESS September/October 2016

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planning the conference, so that was another milestone for us. It was an interesting demographic that was represented there. Overall, a conference of this size has a lot of moving parts and we had a great team, good balance of presentations and meetings, and actually exceeded our high level of optimism in our first year.

CMB: Safe to say there will be a ‘year two’?

DL: Yes and not only are we looking at next year but were projecting out to year three. After a long discussion we decided next year the CBIC would be held in Calgary again. Even though this year was very encouraging and successful on many levels, next year we have to repeat that, so we thought keeping the same venue would contribute to a successful second event. As we are a national conference, we’ll be looking at Ontario to host for year three.

CMB: Are you considering a major market like Toronto?

DL: Yes. Once you get a conference this large, you have to consider how far out you need to go to provide sufficient accommodations and facilities, so the locale has to handle that as well as be convenient for a lot of producers to fly in or drive to.

CMB: When we spoke a few months ago, you had hoped a number of major meetings and associations within the industry would set their calendar and location to the conference. Along with CCA’s Semi-Annual Meeting, I saw Canada Beef and the National Check-off Agency meetings were also held there this year. It really felt like there was real industry unity going on.

DL: That was the intention. It came out of our pillar of connectivity in the National Beef Strategy. Our thought was that if we’re having all these forums going on like at our AGM, Canada Beef’s Fall Forum, the Alberta Angus Association, our Cattlemen’s Young Leaders program, the Canadian Roundtable for Sustainable Beef, etc., that historically met at different locations and dates, why not coalesce the events because the opportunity for interaction, not to mention the number of their members from each of those organizations that would be in attendance, just makes good sense.

CMB: It appears that everyone jumped on board.

DL: Yes, of course some organizations already had committed their events to a particular date and location. For instance, the Canadian Meat Council was encouraged to have their beef committee meet at the conference but unfortunately that didn’t work out this year but it could happen next year. I’m hoping we will have the Canadian Cattle Identification Agency meeting there as well.

CMB: It would make sense as those organizations would more likely have a better turn out if they scheduled with the conference.

DL: Well, yes, but it would create a lot more moving parts. We’re prepared to plan and accommodate whatever is necessary to facilitate that. You have to keep in mind as well that there is a lot of overlap for many of the members in these organizations, so staging multiple events within one general conference would be saving travel costs throughout the year. We had a lot of discussions regarding the opportunities the conference presents to the industry, not only for the heightened interaction, but creating meeting efficiency and subsequently a lot of connection between all these organizations. And to be honest, unless you’re directly involved, sometimes you’re just not really aware of all the great work and initiatives all these organizations are doing. So yes, coalescing these meetings contributes to better awareness of what we’re all doing for our industry.

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CMB: And that translates to unity, which is the goal.

DL: Exactly, yes, but at the end of the day, the success of our conference is still measured by how many active cattle producers register and participate which remains one of our top goals here.

CMB: The award presentations that were held at the conference got some mainstream press.

DL: Yes, they did. The Beef Cattle Research Council hosted their awards and workshops and I was pleased to see that because it appeals to so many producers interested in the new innovations and how they can apply that to their farms.

We also had our The Environment Stewardship Award (TESA) presentation which previously had been presented during CCA’s Semi-Annual Meeting. It was great to present that award before 700 people and give all the nominees that kind of recognition, all of whom, speaking candidly, are worthy of winning the award. We need to showcase this very important environmental work that goes on in our industry, yet we know there are many who don’t sign up to be recognized. So, we’re hopeful even more candidates will be encouraged to register for The Environmental Stewardship Award going forward simply because the gala will be held at the Canadian Beef Industry Conference.

CMB: Mo Jessa, Earls’ president, spoke at the conference.

How was he received?

DL: He struck me as a very sincere individual. Basically his message was in looking back they just made a dumb decision. Matter of fact, those were his exact words. He acknowledged they didn’t connect as well as they should have with the people that produce their product and that they hurt a lot of people. Subsequently the people that run his establishments were put in a very difficult position. But overall, his message was well received. Everyone is looking forward to working together with Earls’ and other chains.

We are in a good place now to not only repair but develop an ongoing relationship that will serve both Earls’ and the industry long into the future.

CMB: Does that mean more verification like Certified Humane?

DL: Yes. There is a lot of remarkable work going on in the industry with respect to that. We have a new module on animal care and verified beef and a feedlot assessment tool that has been developed with a very strong focus on animal care. All of these programs and initiatives are some of the best in the world. Yet chains like Earls’ are, for the most part, simply looking for third party verification because prior there hasn’t been a lot of independent verification in most of cases. Unfortunately, when Earls’ statement went out it did make it sound like we weren’t raising animals humanely.

CMB: It was definitely a public relations mistake.

14 CANADIAN MEAT BUSINESS September/October 2016

DL: When you consider our producers and the amount of work and dedication they put in to their animals, I don’t think you could have struck a nerve more directly on than that one and this is an area where Canada really is a global leader.

Unfortunately, the statement Earls’ released sent the wrong message out and subsequently did create the impression we’re not. So naturally a lot of people in our industry, and more specifically in Alberta, were hurt by that and took it personally.

CMB: Especially when so much of the industry is effected by the optics.

DL: Yes, our producers trade close to $10 billion worth of cattle on handshakes. And then as you move up the value chain it is a lot more contractor specific. So on one hand it’s remarkable that we’re an industry that has enough integrity and confidence that they’re able to trade on that basis, but that said, there are changing requirements that consumers are looking for and so naturally the industry is looking actively on how we can accommodate that. The bottom line is we will continue to raise cattle the very best way we can.

CMB: There was a media report that came out of the conference that touched on the treatment of the animals.

The report indicated the beef industry was resisting customer demands to change the treatment of cattle designated for the food chain. What is your reaction?

DL: I think it comes down to the question of how do you approach consumers with a survey. I’m sure if you asked any consumer, “Do you prefer to have your beef with no antibiotics or hormones in it,” they’re going to say, “Yes, I would prefer that.” The flip side is the practice we have delivers safe beef products and is regarded as one of the best in the world. We follow internationally approved testing procedures that are very sophisticated for any potential residue and we have an exceptionally high compliance rate for safety. So whether you purchase that product from your butcher, from Walmart, Safeway, Earls’, A&W, where ever you go to buy your meat, our commitment is we ensure our beef is safe and wholesome for you. If you want to pay more for some of these market driven claims by these outlets, that’s fine, but we’re committed regardless. Likewise, the same diligence can be said for the practices and procedures we use in producing our beef. Testing can go up to 14 years at least of product and scientific validation before they’re even approved for use. It is an extremely complex and thorough process so for producers it wasn’t as much about resisting the consumer demand but really stating the obvious, in that we are committed to delivering the most wholesome and healthy product we can because we are proud to feed your family just as much as we are proud to feed our own families.

CMB: These issues circle around to sustainability awareness.

In your role as president of the Global Roundtable for Sustainable Beef, did you speak this year as well?

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DL: Yes. We did a number of things because we’re having the global GRSB conference in Banff this coming October. For that reason, we didn’t slot as much time on that, recognizing that we were going to have a huge forum then, yet we did have a session that was well attended. We had Cameron Bruett from JBS, who is a past president of GRSB, who acknowledged the excellent work being done in Canada.

And we’re proud of just how far the Canadian Roundtable of Sustainable Beef has moved in a short period of time, making us one of the leaders in this field.

our issues related to meat hygiene systems. Our sense was the UK was one of our stronger allies on that issue. But it seems to be were going to have to increase our advocacy efforts in Europe to make sure that over the long term we’re able to get some our food safety interventions approved and accepted there. Naturally were not going to turn them off for one market but ultimately the solution is let’s make sure we’ve presented the fact we’ve gone through rigorous testing and utilize one of the best hygiene systems in the world.

CMB: The conference did hold a symposium on foreign trade with most concerns voiced over the Brexit vote and what impact our industry could feel from that.

CMB:Back to the conference, do you think the number of days for this inaugural event was adequate?

DL: That one has been moving around in terms of the implications. There is some push as a result of the European community who still want to demonstrate they’re an effective trading group, so in that regard I think it’s created a bit more impetus to approve the CETA deal quickly.

CMB: Will it get ratified?

DL: Yes, I believe it will get ratified. The way their process works is the EU will ratify the deal and then it’s up to each of the member countries to ratify it. But it does go into effect the moment the EU ratifies it. So all this time that those countries argue or differ internally, whether they approve it or not, CETA will come into effect.

CMB:What do think will happen with respect to the deal?

DL: I think we’ll see CETA get approved. I think it complicates meatbusiness.ca

DL: It’s definitely on the board for discussion. But right now I think we just need a few weeks to recuperate from this year’s event. I can’t say enough for the amazing work the organizers and volunteers put into our inaugural event this year. Once we get the participant reviews back then we’ll table the question. Of course it may also depend on other agencies and groups that we were hopeful would attend this year but can attend next year.

CMB: In closing, what are some of your final thoughts for this first time event?

DL: I think for a first conference it was really extraordinary.

We had a fantastic trade show as well that was really well received. Overall, I feel the conference created an opportunity for every level of our industry, from retailer all the way to seedstock operator, to engage in important dialogue on a wide range of issues. Let’s face it, anytime you’re able to create that opportunity it has to benefit an industry.

September/October 2016 CANADIAN MEAT BUSINESS 15

WATCH AS THE TRANS-PACIFIC PARTNERSHIP (TPP) WITHERS AND DIES

By Chuck Jolley

Lawrence Herman of Herman and Associates and a former Canadian diplomat, practices international trade law and is a senior fellow of the C.D. Howe Institute in Toronto. Recently, he contributed a shrug-of-the-shoulders editorial to The Globe and Mail headlined “If U.S. Congress blocks TPP, there’s nothing Canada can do about it.”

The TPP (Trans-Pacific Partnership) has been an evolving thing of diplomatic beauty, a long debated and constantly refined agreement between a dozen Pacific Rim countries.

The New York Times described it as “the largest regional trade accord in history, (one that) would set new terms for trade and business investment among the United States

and 11 other Pacific Rim nations — a far-flung group with an annual gross domestic product of nearly $28 trillion (U.S.) that represents roughly 40 percent of global G.D.P. and onethird of world trade.”

The Canadian Federation of Agriculture, which fully supports the TPP, and has urged Trudeau to work for its passage, published these data about the size of the agreement and its importance to Canadian agriculture: • Eighty-one percent of Canada’s total exports already go to TPP members.

• It has been reported that TPP countries represent 51% of Canada’s agri-food exports.

• Among the current TPP participants, Japan is the key market for Canadian agricultural exporters.

• The Asia-Pacific region is expected to represent two thirds of the world’s middle class by 2030 and one-half of the global GDP by 2050.

Trudeau has promised “a full and open public debate in Parliament to ensure Canadians are consulted on this historic trade agreement.”

The biggest problem is no one outside of a hard core of direct participants knows exactly what the agreement contains. It could be an amazing financial windfall for the chosen twelve nations or a modern day reincarnation of those mythological Greek sirens, beautiful yet dangerous creatures who lured sailors with their enchanting music and voices only to watch those poor souls as they shipwrecked on the rocky coast of their island.

It was positioned in the U.S. as the political key to the increasingly lucrative Asian marketplace, locking out an aggressive China and preventing it from dominating trade in the region. It was certainly one of the considerations that

16 CANADIAN MEAT BUSINESS September/October 2016

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tipped the Obama administration in its favor; the other being the entry of Japan into the talks. In any case, Herman’s editorial seemed to recognize that, like it or hate it, the economic self-interest of the United States is a major driver in Canadian economic policy.

“But, wait,” as they say on those late night TV infomercials designed to sell the sleep deprived things they never knew they needed, “There’s more!”

Bluntly, there are strong anti-trade interests in both countries that think the death of TPP is just fine.

On the surface, the agreement seems to favor large industries in countries with particularly strong market positions.

With the U.S. and Canada enjoying important positions in world agriculture, it shouldn’t be a surprise that ag interests in both countries have seen an advantage to ratifying the TPP. The major exception, of course, is R-CALF, a group of U.S. cattlemen who are consistently nationalistic and protectionist when it comes to trade issues.

R-CALF is not alone, though. Not-sosilent voices in Ottawa and provincial capitols are concerned about the supply management program, which has always artificially propped up dairy, poultry and eggs. If the TPP agreement is ratified, it becomes a threatened government program.

Dr. Anthony Winson (PhD), College of Social and Applied Human Sciences at the University of Guelph, says the

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September/October 2016 CANADIAN MEAT BUSINESS 17

program “has been an important advantage for thousands of dairy and poultry related farming families across the country.”

Winston fears that allowing foreign producers to enter the protected marketplace threatens the stability of the Canadian market and could end the long-time reliable source of income for farmers and ranchers.

Although the conservative ex-Prime Minister Stephen Harper was firmly behind the agreement, will the more liberal Trudeau government have the courage to tell its ag producers that they are just going to have to enter the wild and woolly international market and sink or swim, based on their own initiatives?

IT WAS POSITIONED IN THE U.S. AS THE POLITICAL KEY TO THE INCREASINGLY LUCRATIVE ASIAN MARKETPLACE, LOCKING OUT AN AGGRESSIVE CHINA AND PREVENTING IT FROM DOMINATING TRADE IN THE REGION. More importantly, after decades of government protection, are those farmers and ranchers capable of surviving what will be a trade battle royal? It will become an economic boxing match pitting a very capable welterweight against a world-class heavyweight to the south.

Canadian and American opponents call the agreement a big business giveaway which would hasten the export of their high-wage manufacturing jobs to low-wage, low regulation nations. Limited competition would boost prices for pharmaceuticals and other high-value products. A provision allowing multinational corporations to challenge American and Canadian regulations and court rulings in front of international tribunals is drawing virulent opposition, too.

The current uncertainty will only be alleviated when the U.S. government votes to ratify or abandon the agreement. It has been a cornerstone of the Obama administration, possibly as important to him and his legacy as the Affordable Care Act, widely known as Obamacare. Until recently, passage of the TPP was almost assured. After all, Hillary Clinton, the current odds-on favorite to win the election, was an early proponent.

But two things have fouled the brew. The always recalcitrant ‘loyal opposition,’ a Republican party whose chief claim to fame has been its absolute refusal to follow any presidential initiative, has been emboldened by the rise of Donald Trump and his consistently stated opposition to the TPP. Ms. Clinton has reversed course and signaled her support has ended.

18 CANADIAN MEAT BUSINESS September/October 2016

Trump, who is not a Republican in the classic sense, has repeatedly tied Clinton to the TPP in an appeal to displaced American workers. In January, he went against years of republican orthodoxy when he said, “I will stop Hillary’s Obamatrade in its tracks, bringing millions of new voters into the Republican Party. We will move manufacturing jobs back to the United States and we will Make American Great Again.”

Although Clinton was an early supporter of the TPP, especially during her service as Secretary of State, she’s been gradually moving away from it. In May, the Washington Post reported that she had finally slammed that door. The Post quoted her saying she “would oppose a vote on the Trans-Pacific Partnership trade accord during a lame-duck session of Congress.”

She stated, “I oppose the TPP agreement — and that means before and after the election.”

The chances that a vote be taken before the November election are slim. The Republican controlled Congress will fight any effort to move the bill to the floor. It means that passage once assured is now likely to be passage denied.

Even after the elections, the Republicans, joined by many Democrats, won’t budge unless major concessions are made, requiring the agreement would have to go back to the “League of Twelve Nations” who put the original document together.

Chuck Jolley is the President of Jolley & Associates and is a respected writer, editor, publisher and public relations expert with more than 25 years experience in the meat and poultry industry.

WAYNE BRYANT REJOINS REISER CANADA AS VP, SALES Wayne Bryant has rejoined Reiser Canada as their Vice President of Sales and in his new role, will lead Reiser’s Canada sales team and be responsible for the continued sales growth of the company.

“Wayne is the consummate salesperson and his customerfirst philosophy and management style are a perfect fit for Reiser,” says Roger Reiser, President and CEO of Robert Reiser & Co., Inc. Bryant has broad knowledge of the Canadian food equipment industry, having focused much of his career in sales and sales management within that industry. For the past ten years, he served as Country Manager for CFS Canada and more recently as Director of Sales at Multivac Canada. Prior to that, Bryant held various roles at both Reiser Canada and Reiser UK. meatbusiness.ca

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ANNOUNCING THE BEEF RESEARCHER MENTORSHIP PROGRAM 2016-17 PARTICIPANTS The Beef Cattle Research Council (BCRC) has announced the participants in the 201617 Beef Researcher Mentorship program. Following an open application process, four researchers have been selected. Each has been paired with notable leaders in the Canadian beef industry and given a travel budget for the coming year which will provide valuable opportunities for greater engagement with Canada’s beef industry.

MENTEE: DR. GETAHUN LEGESSE GIZAW MENTORS: CHARLIE CHRISTIE AND BRENNA GRANT GETAHUN LEGESSE, PH.D., is a Research Associate at the University of Manitoba. He is currently working on a collaborative project that aims to define the environmental footprint of Canadian beef. This involves collecting and analyzing of beef industry data to assess how the environmental impact of the beef industry has changed over the past thirty years. Earlier, he worked in the area of alternative forage-based systems for environmentally-sound and profitable production of beef in Canada. Getahun received his Ph.D. in Animal Science (Livestock Production Systems analysis) from the University of Hohenheim in Stuttgart, Germany.

Through the mentorship program, Getahun hopes to gain more knowledge of cattle management practices as well as policies, regulations, and guidelines that affect the production, transportation, marketing and processing of cattle and beef products.

CHARLIE CHRISTIE, along with his wife Rochelle run a mixed farm with 2000 acres of mixed grain and hay as well as 400 Angus-influence crossbred cows West of Trochu, Alberta. They finish their own calves and custom feed about 300 head. Charlie is the current Finance Chair of the Alberta Beef Producers (ABP) and has been an ABP delegate for nine years, all of these as a Cattle Feeder Council delegate. Charlie has served as the Cattle Feeder Council’s BCRC representative for six years, two of these as chair. He has also been a Zone 5 representative on the ABP research committee for several years.

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BRENNA GRANT has a Master’s of Science in Applied Economics, Professional Agrologist designation and nine years’ experience with Canfax Research Services (CRS). As manager of CRS, Brenna provides industry with statistical information, economic analysis and market outlooks focusing on both the Canadian and global beef markets. Statistical information and economic analyses are used in business plan development, marketing decisions, research, and other projects.

MENTEE: DR. JESSICA GORDON MENTORS: JOE HILL, DR. CALVIN BOOKER, AND DR. PETER KOTZEFF JESSICA GORDON D.V.M., D.V.SC, is an Assistant Professor in Ruminant Health Management in the Department of Population Medicine at the Ontario Veterinary College. She focuses her teaching on beef cattle health and management. Her most recent research involved parasite control in cow-calf herds. Jessica grew up in an urban setting in Michigan with little exposure to agriculture. Her interest in cattle was sparked during her undergraduate program when she participated in a research project involving bovine nutrition. She fostered this interest by working on a dairy for several years, taking many management and nutrition classes, and completing her BS in Animal Science at Michigan State University. She continued to follow her passion for cattle by focusing on food animal medicine in veterinary school. After graduation from veterinary school, she held a position in a food animal practice in Wisconsin servicing mostly dairy and cow-calf producers. She left the practice after 3 years to pursue a meatbusiness.ca

DVSc at the University of Guelph in Ruminant Health. She hopes to continue applied research in cow-calf and feedlot medicine, expanding into other areas such as disease prevalence and prevention and causes of lameness.

Through the mentorship program, Jessica hopes to expand her knowledge of both the Canadian and global beef industry and better understand industry issues in order to tailor her research to finding solutions to relevant problems to Canadian beef producers.

JOE HILL, his wife Jennifer, and children Kaleb and Miranda run a small feedlot and crop farm in Wellington County, Ontario. They grow corn, soybeans, wheat, barley and hay on 800 acres, with on-farm drying and storage for the grain.

In the cattle operation, they purchase yearling cattle from backgrounding farms, through auction, and finish them on a grain based diet. Cattle typically arrive weighing 1000lbs to 1050lbs and are marketed around 1600lbs. Joe has been on the Beef Farmers of Ontario board of directors since 2011 and currently sits as Vice-President. He represents the Ontario beef industry on the Canadian Cattlemen’s Association and the Agriculture Adaptation Council, which provides GF2 funding to businesses and organizations on behalf of the Ontario Government. Joe was an inaugural board member on the Livestock Research and Innovation Corporation. His experiences have allowed him the opportunity to work with government, academia and producers from a cross section of Ontario agriculture.

DR. CALVIN BOOKER received his D.V.M. in 1989 and his M.Vet.Sc. in 1992 from the Western College of Veterinary Medicine. Dr. Booker completed an internship at the Ambulatory Clinic, New York State College of Veterinary Medicine, Cornell University, Ithaca, New York in 1990 and a residency at the Field Service Clinic, Western College of Veterinary Medicine, Saskatoon, Saskatchewan in 1992. From 1990 to 1992, Dr. Booker collaborated on research efforts with Feedlot Health Management Services (Feedlot Health), which is a professional services company that provides veterinary and production consulting services as well as computerized individual animal data collection systems and management/ execution tools, to feedlot and calf grower operations throughout Canada, the United States, and Mexico. Dr. Booker became part of the Feedlot Health team in 1992 as an epidemiologist, data analyst and production consultant.

Dr. Booker is currently a Managing Partner in the firm, with responsibilities that include managing the Feedlot Health production consulting business, directing research and development activities, and building the company growth and development plan.

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September/October 2016 CANADIAN MEAT BUSINESS 21

DR. PETER KOTZEFF is a graduate of the Ontario Veterinary College. He is a partner at North Heritage Animal Hospital, a small animal practice managed by his daughter. Peter devotes 100% of his professional time to beef practice and the beef industry at the Chesley Veterinary Clinic. Peter operates a 2000 acre cash crop and grazing operation in Bruce County Ontario with an emphasis on integrating cattle grazing, cover crops and minimal tillage to improve soil quality. He received the 2014 Ontario Cattleman’s Environmental Stewardship Award and the 2015 Grazing Award for his grazing operation.

MENTEE: DR. KATERYN ROCHON MENTORS: TIM OLEKSYN AND KARIN SCHMID KATERYN ROCHON, PH.D. is an Assistant Professor in the Department of Entomology at the University of Manitoba, where her research program is focused on arthropods as vectors of both livestock and wildlife pathogens, with a current emphasis on tick distribution and ecology.

Kateryn has a Ph.D. in Veterinary Entomology from North Carolina, her dissertation work focused on the potential of stable flies to act as a vector for a swine virus causing serious problems to the industry at the time. Following her degree, Kateryn moved back to Canada to complete a three-year postdoctoral fellowship at Agriculture and AgriFood Canada in Lethbridge, where she did research on geographic distribution and sampling of Rocky Mountain wood ticks.

Through the mentorship program, Kateryn would like to gain a better understanding of the structure of the Canadian beef industry and increase her network of producers to better understand the production challenges they face.

TIM OLEKSYN farms and ranches near Shellbrook, Saskatchewan, along with his wife and brothers, where he manages the cow/calf operation for Oleksyn Brothers Farms.

His extensive involvement with the beef industry has a sharp focus on research, and Tim serves on a number of boards and advisory groups, both provincially and nationally. He is the past Chair of the Beef Cattle Research Council. Tim is also Chair of Western Beef Development Centre, and Vice-Chair of the Saskatchewan Agriculture Development Fund.

KARIN SCHMID is the Beef Production Specialist for the Alberta Beef Producers.

Karin grew up on a mixed farm near Keoma, AB, raising purebred Simmental cattle and grain, and is still involved to a limited extent. She has a Master’s 22 CANADIAN MEAT BUSINESS September/October 2016

Degree in Agriculture from the University of Alberta, which focused on the genetic and metabolic factors affecting feed efficiency in beef cattle. Before joining ABP, Karin spent just over four years with the Canadian Hereford Association as their Breed Development Coordinator. As the Beef Production Specialist for ABP Karin provides technical support in the areas of production, health, welfare, and research.

MENTEE: DR. MARJOLAINE ROUSSEAU MENTORS: JACQUES DESROSIERS, STEVE EBY AND DR. RÉMI LAPLANTE MARJOLAINE ROUSSEAU, DMV, is currently an Assistant Professor of Bovine Ambulatory Medicine at the University of Montreal. After graduation of her DMV at the University of Montreal, she completed an Internship in Bovine Medicine at the same institution then worked for a mixed animal practice in a rural veterinarian shortage area in southeastern Ohio. In 2008, she started a 3-year residency in food animal surgery at Kansas State University. By 2011, she had graduated from that program and completed a master’s degree which investigated the use of an absorbable carrier to deliver antimicrobials and growth factors to bone in order to enhance its healing in presence of infection in a goat model. In 2011, she returned to the University of Montreal as a clinician at the Farm Animal Hospital. She became a certified specialist of large animal surgery by the American College of Veterinary Surgeons in 2016.She is currently involved as a co-investigator in a research project to evaluate the use of a new disinfectant as a footbath to control digital dermatitis.

Through the mentorship program, Marjolaine hopes to broaden her knowledge of the feedlot sector and specific feedlot herd management strategies. Marjolaine would like to better understand the decision making processes of large feedlots as well as the specific clinical problems faced by the industry.

JACQUES DESROSIERS, along with his family operate Ferme B et L Desrosiers, a farm and feedlot in Saint-Hermas, Québec. They feed approximately 3500 head a year that are primarily Angus. They also farm 2000 acres, growing soybeans, wheat, and corn.

STEVE EBY owns and operates a feedlot, grazing and crop operation near the shores of Lake Huron in Kincardine, Ontario. The Eby family markets 1500 head of fed cattle annually and manage 300 head on pasture. He is a University of Guelph grad with a major in Animal Science.

Steve has been very involved in a number of agricultural organizations including the Bruce County Cattlemen’s Association, Grey Bruce Farmers Week, OMAFRA Livestock meatbusiness.ca

Medicines Committee, Chair of Ontario Cattlemen’s Association Research Committee, as well a past board member of Beef Farmers of Ontario and Canadian Cattle Identification Agency. He is currently a member of the Beef Farmers of Ontario Feedlot Committee.

DR. RÉMI LAPLANTE currently holds the position of veterinary advisor for Les Producteurs de bovins du Québec.

Following his graduation from the Université de Montréal’s Faculté de médecine vétérinaire in 1982, Rémi worked as a large animal practitioner for 34 years, providing health management and veterinary services to dairy, feedlot and cow-calf producers.

The Beef Researcher Mentorship Program provides upcoming and new applied researchers with the opportunity to deepen their understanding of the needs of the beef industry in practical and meaningful ways. Participants are paired with innovative cattle producers and other industry professionals for a one year mentorship along with a travel budget to attend industry meetings, producer workshops, and farm tours. The program complements similar programs in existence but for which some researchers may not be eligible. Funding is made available through the technology transfer initiative within the second Beef Cattle Industry Science Cluster.

Learn more about the Beef Researcher Mentorship program, including highlights from last year’s participants, at http://www.beefresearch.ca/about/mentorship-program.cfm.

Sean Dougherty, Jarvis Canada’s new General Manager inspecting a Model USSS1 pneumatic stunner.

JARVIS APPOINTS SEAN DOUGHERTY AS CANADIAN GM Jarvis Products Corporation has named Sean Dougherty as the new General Manager of Jarvis Industries Canada, Ltd., its Canadian subsidiary located in Calgary, Alberta.

Sean is taking over for Dwight Streeter who recently retired.

Before becoming head of Jarvis’ Canadian operation, he was Managing Director of Jarvis Equipment NZ Ltd. in New Zealand.

Sean started with the company in 2000 as a sales and service representative and in 2003, he was appointed the subsidiary’s Managing Director of the New Zealand operation. His other accomplishments were setting up a Jarvis office in the Philippines, manned by a full-time sales and service representative, and extending support services to other surrounding Pacific Rim countries.

As the new General Manager of Jarvis Canada, Sean considers his new job an exciting adventure. Compared to New Zealand, he’s amazed by Canada’s geographic size, the volume of product being processed, and the larger size of processed animals.

“Covering the vast distances to serve customers is a challenge, but I am surrounded by a great team of service representatives throughout the country, and the full backing of a dedicated team here in our Calgary office,” stated Sean. ``Even with Jarvis Canada’s excellent reputation within the industry, I am currently working on a number of projects that will further enhance our support services and quality reputation”.

Jarvis equipment is sold and serviced worldwide through 18 branch locations and Jarvis’ J26 Exclusive Distributors.

For more information, visit www.jarviscanada.com

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PORK PRICE STABILITY APPEARS TO BE IN THE REARVIEW MIRROR

By Kevin Grier

One of the characteristics of the pork market during the first half of this year was the relative stability in pricing and supply. This was a relief, if not very unusual after the wild rides of 2014 and 2015. Recall that in 2014 no one really knew the real supply impact of the PED outbreak in the U.S. For the most part, the industry seemed to be always on the short side of demand and of expectations. That meant that the industry was usually short of hogs and pork and pricing reacted by exploding to record highs.

Moving into 2015, it was the opposite. The producer recovery in the United States exceeded expectations. That often meant that production also exceeded expectations and pricing responded accordingly.

THE YEAR TO DATE By the later quarter of 2015 and through the first half of 2016, the stability of pricing and the predictability of supply was a welcome respite. By June and July this year, however, pricing began to soar higher. Buyers and sellers alike were either blaming or crediting the surging buying and demand from China. Hog prices, futures and pork cuts generally bounded higher.

By mid-July, however, the bloom was off the Chinese demand.

A more sluggish export demand profile was combined with domestic demand that no longer was supported by record high beef prices. In fact by this summer, beef prices, while not low, were starting to look half-reasonable to both consumers and grocers alike.

To make matters worse for pork sellers, slaughter levels were exceeding what was expected based on the USDA June Hogs and Pigs Report. Combine a weaker demand with more slaughter and production and it is a recipe for big price declines, which is exactly what happened in late July and August.

INSTABILITY CONTINUES IN THE FOURTH QUARTER All of that is a long way of saying that the stability that market participants were enjoying for the previous nine or 24 CANADIAN MEAT BUSINESS September/October 2016

so months appears to be in the rear-view mirror. Looking to the fourth quarter there is a greater chance of instability than stability. That is mostly because of the supply side. It was always known and loudly shouted that there were going to be weeks in the fourth quarter where supplies of live hogs would be bumping up against U.S. slaughter capacity. I noted repeatedly that as long as the demand for pork was there and as long as margins held, U.S. packers would wade through the numbers like a hot knife through butter.

The question, however, is that given that numbers seem to be coming in more than expected, is the capacity situation going to be more precarious? That appears likely. Again the industry is going to be counting on strong demand on both the domestic and export fronts in order to pull through the October to December period.

THE EFFECT OF U.S. SLAUGHTER CAPACITY Speaking of capacity, there has been a great deal of interest, if not outright excitement on the pending slaughter capacity coming on stream in the United States. As a starting point, there are likely to be two new, albeit smaller plants being completed by this fourth quarter. The two plants are located in Missouri and Minnesota and will have a combined weekly capacity of 30-35,000 head.

There are also two larger plants that are going to be operational in the third or fourth quarter of 2017. Those plants in Iowa and Michigan will be operated by Seaboard Triumph Foods and the Clemens Food Group respectively.

Both plants will initially have just one shift but will be killing meatbusiness.ca

about 50-60,000 head per week each.

It is likely that the Triumph plant would be double shifted by 2018 and it is possible that the Clemens plant will also be double shifted by then.

Furthermore, with regard to 2018, Prestage Farms plans to build a big 50,000/week single shift plant in Iowa which should be operational by the fourth quarter. Both Seaboard and Clemens are long established packers with deep production roots.

Prestage on the other hand is a large scale producer that is just entering the packing sector.

GOOD NEWS FOR RETAIL PORK BUYERS We could talk a great deal about what this all means for the pork industry but one thing is clear, pork buyers at retail and foodservice are likely going to be in the driver’s seat. Another thing that is clear is that it is going to be tough sailing for the packing sector starting in 2018 or sooner. All that new capacity is going to be chasing both hogs and customers. Pork buyers will be wooed by packers who will be seeking to keep customers and others looking to find new customers.

The bottom line for the industry is that there is going to be record volumes of pork coming in the next couple of years. The period of calm of the last several months is going to give way to more volatility. All of the industry, from producer through to retail/foodservice is going to need the robust demand that the industry has enjoyed recently to continue to hold strong.

Kevin Grier is a respected and connected agriculture and food market analyst with a solid understanding of industry issues from farm to retail. His research and analysis helps companies, producer groups, financial service organizations and governments make informed decisions that impact their bottom line. For more information, visit www. kevingrier.com Courtesy of Ontario Pork – www.ontariopork.on.ca

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HELPING CONSUMERS MAKE AN INFORMED CHOICE

By Tom Lynch-Staunton, Issues Manager Canadian Cattlemen’s Association

During the Canadian Beef Industry Conference (CBIC), I was asked to do an interview on CBC’s Calgary Eyeopener on the use of growth hormone implants in the beef industry.

The impetus for the interview followed a retailer panel discussion on ‘Beef Demand’ a pillar of the National Beef Strategy - focused on ‘what consumers want.’ One of the statements made was around the use of products, particularly hormones, and that the industry will need to step up and give the consumers what they want.

Based on the consumer research one company had done, their representative was sure the consumer wants beef with no added hormones.

It’s unclear if the marketing research asked consumers why they felt that way or what most influenced or helped shape their opinions – yet understanding this piece is key when considering the question: do consumers actually know what they want? Henry Ford said “If I had asked people what they wanted, they would have said faster horses.” The late Steve 26 CANADIAN MEAT BUSINESS September/October 2016

Jobs, founder of Apple also said, “A lot of times, people don’t know what they want until you show it to them.”

Farmers and beef producers are often accused of ignoring what consumers want, but that is not the case, as ongoing work in the industry demonstrates. As misperceptions about production practices are an unfortunate part of popular culture, it is our obligation to provide the public with the other side of the story so they can make an informed choice.

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For example, if I knew nothing of growth hormone implants, and someone asked me if I was concerned that there could be increased hormones in my beef, without any context as to why or even what levels of hormones, I too may be concerned. This also highlights why some advertising or marketing campaigns attempting market differentiation can be misleading and create unfortunate consequences. If a consumer knows nothing about hormones, and now they see an ad with ’beef with no added hormones,’ automatically they will think that hormones must be bad, and that all other beef without this label is also bad.

So, what do we do? As an industry, we have a standing offer to share research and science with food companies, restaurants and marketing and advertising firms to ensure production practices are understood. That may not happen as often as we’d like, but it is our duty to explain to consumers why we use certain products, the positive and negative aspects about those products, so that consumers can make an informed choice. Simply changing our practices overnight to follow one attribute because ‘market research’ shows a portion of consumers are concerned is a dangerous precedent to set.

If beef producers stopped using growth hormones tomorrow, we would need more feed, land, and water to produce enough beef to meet the market demands, which would also result in more greenhouse gas (GHG) emissions.

This would also increase the cost of beef to all consumers, at a time when retail beef prices are already quite high. Will a consumer who is already financially constrained continue to buy a higher priced beef product, or will they switch out of beef? We can’t forget how important affordability is to many of our consumers.

Furthermore, there is the global ethical question. Technologies like hormones mean we can produce more beef using fewer resources, with no detrimental effects on either the animal or human health. Why would we as a society decided to restrict food production, when there are 1 billion people starving on the planet?

Unfortunately, when we debate the merits of using something like hormone implants, despite proving the benefits, we are still often perceived as only being concerned with profit. That is why we need to have several strategies in how we communicate.

Being open, honest, and objective will be very important. Highlighting that we do not want to produce food that is unhealthy or even has the chance of being unhealthy and showing people how hormones work will go a long way. And yes, we do still need to acknowledge that we do need to be financially viable, or we will simply not raise beef at all.

Ultimately, we want as many people as we can to feel good about eating beef.

We can be and will be able to have conversations about growth hormones with consumers, and many consumers will understand and trust why these products are important and can have benefits to our environment and overall production system, and be perfectly fine with any Canadian beef product. However, there will still be some who will just feel better knowing that there were no extra interventions, even if they know the benefits. The kicker is that if some people feel good about eating beef with no added hormones, they choose it over another competing protein, and they also feel OK about paying a bit more for it, that is also good for the industry. We just need to be cognizant that we don’t undermine other production methods which produces equally nutritious, healthy, tasty, and safe beef.

We are very lucky to have choice in Canada, and we can accommodate many market segments that place different values on attributes. We just need to make sure that the choices consumers make are for the right reasons using all the information available.

meatbusiness.ca

September/October 2016 CANADIAN MEAT BUSINESS 27

RESETTING CANADA’S MAIN AGRICULTURE POLICY

By Mandy D’Autremont

EVERY FIVE YEARS, federal, provincial and territorial (FPT) agriculture ministers press reset on Canada’s suite of agricultural programs and initiatives. The current framework, Growing Forward II, will expire in March 2018 and the next edition is already being discussed with stakeholders and officials across the country.

We know these policies will impact your bottom line, so we want to provide a quick review of what agriculture ministers intend to focus on for the next policy framework. But the real question will be – does their list pass the test and reflect what’s important to your business?

WHAT’S ON THE TABLE? FPT agriculture ministers met in July for their annual meeting and released a document titled: The Calgary Statement.

This statement outlines their vision for the next agriculture policy framework, which includes growing global market opportunities, leveraging science and innovation to enhance competitiveness, improving growth of value-added agriculture and agri-food processing, as well as addressing pressures like unstable commodity prices, extreme weather, and changing consumer expectations. To meet these objectives, the Statement proposes a list of six ‘priority areas’ for the framework: 1. Markets and trade – Increasing market access internationally will continue to be an integral part of the framework, as will growing domestic markets.

2. Science, research and innovation – A focus on research and innovation has been carried over from previous agreements.

3. Risk management – Maintaining the suite of business risk management programs will also continue to play a significant role in the next policy framework.

4. Environmental sustainability and climate change – This new priority area proposes environmental sustainability initiatives to address agriculture’s impacts on Canada’s natural resources, reduce greenhouse gas emissions, and mitigate and adapt to anticipated impacts of climate change.

5. Value-added agriculture and agri-food processing – Initiatives to leverage industry investments toward improving productivity and competitiveness, and adopting new technologies and processes that will improve sustainability, efficiency and meet consumer demands.

6. Public trust – Canada has a reputation as one of the most reliable and respected agriculture sectors. This new priority area proposes initiatives to ensure Canadian agriculture maintains and leverages its strong reputation.

28 CANADIAN MEAT BUSINESS September/October 2016

WHAT’S MISSING FROM THE LIST? The six areas that FPT agriculture ministers will focus on may impact the sector and your businesses’ success over the next few years, but have all of the issues that hold back your business’s productivity been put on the table?

I’m sure there are a number of issues that come to mind that aren’t on the list above. You are not alone – The Canadian Federation of Independent Business (CFIB) surveys our agribusiness members regularly and red tape (79%) consistently tops the list of high priority concerns, as does taxation (70%), and access to reliable and qualified staff (47%), particularly among the meat processing sector.

In order to introduce a solid five-year agriculture policy agreement, governments need to listen to producers and develop a comprehensive plan addressing the agriculture sector’s competitive challenges – particularly reducing red tape, which causes the sector a lot of headaches and stifles innovation.

While we recognize some steps have been taken by federal and provincial government agencies to improve service, we believe a clear plan to reduce red tape deserves to be a part of the next framework to ensure it is given the attention it deserves.

Make your voice heard: With federal and provincial governments actively seeking input from stakeholders across the county, now is the time for them to hear your views. Providing your perspective will ensure the next agriculture policy framework actually helps your business be more competitive from 2018 and onward.

You can submit your feedback on The Calgary Statement through an online consultation questionnaire (opens in a new window) or by emailing the government at: aafc.npf-pcs. aac@canada.ca Mandy D’Autremont is Director, Agri-business with the Canadian Federation of Independent Business and can be reached at mssask@cfib.ca Established in 1971, CFIB is Canada’s largest association of small- and medium-sized businesses, CFIB is Powered by Entrepreneurs™. CFIB takes direction from more than 109,000 members (including 7,200 agri-business owners) in every sector nationwide, giving independent business a strong and influential voice at all levels of government and helping to grow the economy.

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F O U N D AT I O N F O R M E AT P O U LT R Y RESEARCH E D U C AT I O N

Advanced Listeria monocytogenes Intervention and Control Workshop October 18-19, 2016 KANSAS CITY, MO

Take your Listeria control plan to the next level with information from the industry’s leading experts Every day, RTE manufacturers face the challenge of controlling Listeria monocytogenes in order to produce safe, nutritious products. From sanitation to corrective actions and sampling plans to data analysis, Listeria control involves your whole team. Not only does the workshop have presentations on the latest developments in Listeria control and real-life examples from people with plant experience, it features hands on demonstrations, breakout sessions and case studies designed to give you ďŹ rst-hand knowledge to apply to your plant. In addition, this workshop provides critical information to help processors stay up to date on regulatory issues and changes.

Co-Sponsors

American Meat Science Association

For more information and to register go to www.meatinstitute.org Sponsorship and exhibit opportunities available. meatbusiness.ca

September/October 2016 CANADIAN MEAT BUSINESS 29

NEW NATIONAL BEEF CATTLE CHECKOFF STUDY SHOWS INCREASED BENEFITS The Canadian Beef Cattle Research, Market Development and Promotion Agency (the Agency), in partnership with Canfax Research Services has released a study evaluating the economic benefits from the Canadian Beef Cattle Check-Off. The study, prepared by Dr. James Rude and Dr. Ellen Goddard, is an update on the 2010 Cranfield Study which had reported results ahead of the 2010 merge of the Beef Information Centre, Canadian Beef Export Federation and the National Check-Off Agency.

marginal benefit cost ratio. It is this diminishing marginal return that helps explain why as investment has increased for research over the past five years, that the benefit cost ratio has declined, just as marketing dollars have declined and the benefit cost ratio has increased.

The new study reports that on average from 2011/12 to 2013/14, every check-off dollar invested in national research and marketing activities resulted in a benefit cost ratio of 14:1 or $14 of benefit for Canadian cattle producers. This is up from the $9 average between 2005 and 2008. In addition, the average benefit cost ratio grew steadily between 2011 and 2014. This implies that despite positive benefits, there has been under-investment in research and marketing activities for the Canadian beef cattle industry.

While the Canadian Beef Cattle Check-off provides the core industry funding for research and marketing programs, it does not fully cover the costs of all programs and activities.

Supplementary funding is obtained by leveraging the Canadian Beef Cattle Check-off, attracting on average $3 for every $1 for research and $1 for every $1 for marketing between 2011/12 and 2013/14.

Newly elected Agency Chair Linda Allison is confident that setting goals based on the study results will ensure that the industry moves forward together.

“The 14:1 benefit seen from each National Check-Off dollar confirms the value of producer investment,” said Allison.

“However, with the declining purchasing power of the National Check-Off and reduced marketings in recent years, under-investment is evident. It is imperative that we continue to find ways to optimize the return for our producers across the country.”

The change in benefit cost ratio for research, overseen by the Beef Cattle Research Council dropped from $46 to $34.50 during 2005 to 2008, while marketing, managed by Canada Beef, had a benefit cost ratio of $13.50, up from $7.55 in the previous study.

Generally, an inverse relationship exists between the amount of money spent on a promotion or research activity and its 30 CANADIAN MEAT BUSINESS September/October 2016

Melinda German, General Manager of the Agency, spoke of the research and marketing organizations responsible for investing check-off dollars.

“The work that the Beef Cattle Research Council and Canada Beef carry out, continues to show great returns for our industry,” German said. “By ensuring a sustained and increasing benefit cost ratio, we can continue to work towards common industry goals laid out in the National Beef Strategy.”

The Agency is dedicated to continually monitoring the benefit cost ratio of the National Check-Off through ongoing studies, and ensuring that extra value is derived from producer checkoff and import levy investments.

Along with the full study from Dr. Rude, the Agency and Canfax Research Services developed two supplementary documents to pinpoint the highlights of the study and how they are applicable to the Canadian beef industry.

For more information, visit www.canadabeef.ca

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WASHDOWN-READY EQUIPMENT: RESPONDING TO THE MODERN NEEDS OF FOOD PROCESSORS To meet the rigorous safety standards of the industry, many food processing facilities use wet cleaning or spray downs as best practice for washing and sanitizing equipment and surfaces. This cleaning procedure follows the Hazard Analysis Critical Control Point (HACCP) process, using high-pressure hot water to pre-rinse and then clean the processing floor to quickly kill bacteria and successfully disinfect the area.

While wet cleaning is a practical proven-practice that allows facility managers to validate the cleanliness of their environments, facility mangers across the industry must be aware of the lingering risks of harmful microorganism growth, remaining allergens, loss of time and product waste.

Unlike what the term leads us to believe, “wet cleaning” is not just about wetness. In fact, as mentioned in the Five Keys to Safer Food manual by the World Health Organization (WHO), “drying” during the cleaning process is integral to the prevention of bacteria spreading1. More specifically, if an item is not completely dried, residual bacteria can remain.

One bacterium can double in just 15 minutes; meaning that within six hours, a single bacterium can multiply to over 16 million.2

stuck in crevices, become stagnant, and harbour mold or bacteria. Having a dispenser engineered to channel water off the housing, and away from the refills inside, can be a highly useful tool.

Secondly, keyholes traditionally located at the top of dispenser casings remain the perfect way to invite water inside the dispenser. Water can leak in through the keyhole, spoiling unused towels and leaving the facility manager YesGroup_CanadianMeatBusiness-Qtr-pg.pdf 1 2014-05-16 1:20:17 PM

Continued on page 32

Despite this threatening safety risk, water-sensitive equipment is routinely taped with plastic wrap, new garbage bags or other pre-used plastic during wet cleaning. This ‘cover-up’ procedure can lead to inconsistent coverage and leaks, creating significant risk for water infiltration, and bacteria growth.

Covering up equipment during spray-down can limit opportunities for increased productivity, with more time spent prepping for a washdown meaning less time for cleaning and working. In addition, poorly taped items and surfaces can result in wet, damaged and wasted materials requiring restocking or repurchasing.

Let’s use paper towel dispensers as an example. To dig deeper and further understand the dispenser safety and wet cleaning needs of today’s food processors, SCA commissioned an independent research study. The results revealed, in addition to a certification from HACCP International, that an ideal dispenser would be available with improved safety and contamination deterrents, increased durability, greater capacity, ease of refill and… water resistance.

Traditional dispensers are usually designed with keyholes at the top or esthetically creviced casing for style. These two design elements can be considered as flaws when exposed to high-pressure water spraying. First, water could remain meatbusiness.ca

September/October 2016 CANADIAN MEAT BUSINESS 31

with no other choice but to replace them - a true waste of product and money. Even worse, since contamination would be occurring from the inside of the dispenser, it might take days before the manager discovers the problem, usually the hard way. If one bacterium can multiply to over 16 million in six hours, imagine what it can do over a weekend.

Fortunately, there are HACCP International-certified, washdown-ready, hand towel dispensers specifically designed to handle the rigours of food processing environments, while mitigating bacteria risks and streamlining operational efficiencies. To find them, food processing facility managers simply need to know what to look for.

With features such as water-resistance there is no need to remove or protect dispensers during routine sanitation, including high-pressure spray. This eliminates the mess, cost and waste of cover-ups and reduces cleaning time. Time can also be saved by looking for a dispenser that stays stocked longer, meaning less downtime for refilling and more time for wiping after a spray down.

Washdown-ready equipment reflects the modern trend now available to industry stakeholders seeking to mitigate risks, increase productivity and reinforce HACCP protocol in their facilities. In addition to wet washing, as the food industry evolves, the prices of raw food increases, and safety requirements tighten, food processors should seek opportunities throughout their facilities to further balance cost-saving with efficiencies.

As North American food processors continue to be under the scrutiny of the United States Department of Agriculture, Food and Drug Association and Canadian Food Inspection Agency, wet cleaning processes must be innovated to ensure facilities are kept safe and hygienic. The introduction of washdown-ready equipment into facilities, such as waterresistant towel dispensers, is a smart step to begin creating a more modernized and efficient food processing environment.

For more information, visit www.sca.com/us and www.tork.ca

MAPLE LEAF FOODS INC.: THE BEST STOCK YOU’VE NEVER HEARD OF Exclusive Report by Ryan Vanzo, Motley Fool Canada

Even after outperforming the TSX every year since 2011, Maple Leaf Foods Inc. (TSX:MFI) is still an extremely under-followed stock. On average, only about $5 million worth of shares trade on the market each day. That’s a paltry number considering the company is worth close to $4 billion.

So far this year, Maple Leaf Foods has put together another market-beating performance. Year-to-date, company shares are up 23.4% versus a market return of just 13.8%. But still, most investors are unaware of Maple Foods or the strong tailwinds it has behind it.

Here’s what you need to know.

THIS IS A STORY THAT TOOK YEARS TO PLAY OUT With operations in Canada, the U.S., Mexico, the U.K., and Asia, Maple Leaf is one of the market’s largest protein suppliers, producing processed foods made of pork, poultry, beef, and more. When processed meat prices started to decline, however, both profit margins and sales growth turned negative. In 2010 the company engaged in a bold turnaround attempt.

HERE’S WHAT HAPPENED. For years Maple Leaf had been plagued by outdated manufacturing facilities, a bloated workforce, and onerous maintenance costs. The turnaround attempt effectively shed inefficient business lines, invested over $800 million in new manufacturing plants, and pumped nearly $100 million into new technologies that would improve throughput times and lower costs.

The change in business strategy took years to pull off. As late as 2013, Maple Leaf was still losing money nearly every quarter. But by 2014, EBITDA margins turned positive, continuing to climb to today’s 10.3% level. In fact, EBITDA 32 CANADIAN MEAT BUSINESS September/October 2016

margins have increased every quarter since mid-2014. The company’s ultimate target was to go from negative EBITDA margins to 10%. Management has clearly proven its ability to follow through on long-term goals.

“They have definitely turned the corner,” says Bob Gibson, an analyst at Octagon Capital. “Everything is in place: They have shut down the old plants, they have got the new plant and they have to get it running smoothly and efficiently. There is significantly less cost, the machines are faster, there is less labour, and it’s a lot cheaper to manufacture the various products.”

IS THE STORY OVER? Many of the company’s improvements won’t happen again. For example, management consolidated 11 preparedmeats-manufacturing sites into just four. It also brought its distribution centres down from 19 to two. A full conversion over to SAP software has integrated its entire supply chain and manufacturing process, which should sustain most of the efficiency gains.

With a state-of-the art, low-cost manufacturing and distribution network, Maple Leaf is almost unrecognizable from the company it was just five years ago. And while vast improvements have been made, it looks like the rate of growth may slow considerably. Management’s ultimate target was to hit 10% EBITDA margins. Now at 10.3%, it appears as if margin expansion is running out of steam.

Now trading at 32 times earnings, it looks like the stock has gotten a bit ahead of itself. If shares pull back, however, Maple Leaf foods has one of the best long-term management teams on the TSX. For more information, visit http://www.fool.ca/

meatbusiness.ca

TANKA BARS: Q&A WITH MARK TISEN “THE ORIGINAL MEAT BAR”

By Cam Patterson

In the highly competitive world of breakfast foods and energy bars, the meat bar may just be the most talked about on the market. But if you think one of the big conglomerates like General Mills actually had the genius idea to blend meat with fruit and create an entirely new hybrid on your grocery shelves, you’d be wrong. That distinction goes to a small start-up of Oglala Lakota Native Americans on the Pine Ridge Reservation in South Dakota who incorporated a company known as Native American Natural Foods.

According to the company’s website at www.tankabar.com the meaning for “Tanka” states, to Live Life Powerfully, to be in harmony with your spirit and with the earth.

Canadian Meat Business (CMB) contacted Native American Natural Foods president, Mark Tilsen (MT) for the following Question and Answer conversation.

CMB: Can you give us the background as to how you got into Bison bars?

MT: In 2007 Native American Natural Foods released the first meat and fruit bar into the marketplace from our website, tankabar.com, as well as through national distribution in 2010. Matter a fact most of the fruit and meat bars you see on the shelves are mostly knock offs of the original Tanka Bar. CMB: What goes into a Tanka Bar? MT: The bar is based on the Dakota recipe called Wasna, and translates into “All Mixed Up.” So the bar is based on meatbusiness.ca

the art of when indigenous people would mix the acid from fruit to preserve their meat. It was a very common practice to pound your meat prior to being stored. Traditionally they would’ve used the richest fats they could have gotten at the time or that was available to them, because the goal was to preserve calories. Our goal, however, was to produce a high value product that was very nutritious while still having good flavor to it.

CMB: When you did launch and did you have to do a lot of marketing to get noticed?

MT: Actually, we didn’t expect the response to the bar we got to be honest. We took it to the Black Hills Pow Wow and found people were really enthusiastic. You know creating and getting the bars ready was actually a quiet little project that we did, so we were surprised when it made the local paper, then the Associated Press picked it up, hit national public radio, and 10 days later we were on the cover of the New York Times taste section. We were not even prepared for that kind of reception but the response showed us that September/October 2016 CANADIAN MEAT BUSINESS 33

there really was a market. Now we’re in the position of trying to hang onto the market we built because large scale competitors have now produced their versions of the meat and fruit bar.

CMB: Specifically pushing Bison bars?

MT: Some are. General Mills is one example who are promoting fruit and other proteins in their bars. Hershey and several other major competitors have copied Native American Natural Foods original meat and fruit bar.

CMB: Did you anticipate the response outside of the Native American community?

MT: You know we did. We were very deliberate in our plan to establish a national brand with the hope of being an international brand – which we’re soon to be. And it all stemmed from the intent to share the very best of our community, developing a product that reflected the intellectual integrity in our Native American communities.

While people tend to perceive the poverty and isolation aspects of indigenous peoples there is also great opportunity, and Native American Natural Foods is, by virtue of our success and ingenuity, proving that.

CMB: Is there a plan to bring the Tanka bar into Canada?

MT: Currently we are not sold in Canada but we are getting a lot of inquiries from potential retailers and distributors who want to carry our brand. That’s very encouraging.

Partnerships are developing up in Canada, so it’s looking like 2017 is the year we’re going to do it.

CMB: What is Native American Natural Food’s commitment to sustainability and humane practices? Your website has plenty of information for consumers on how the bison is sourced and it definitely is part of the marketing behind Tanka Bars.

MT: We currently source from some of the highest quality producers in the country and are vigilant with ensuring the 34 CANADIAN MEAT BUSINESS September/October 2016

meat we use is of the highest certification with respect to their animal handling. We are also intent on returning the buffalo to the natural grass lands of North America, so we’ve developed a network with people who share our interest in developing buffalo herds beyond just being a healthy protein source. It is our mission statement to commit to the restoration of the buffalo because it is important to our culture and our history. You know, coincidentally, I was up in Canada to attend the Native American Bison Conference in Calgary and met with producers up there who also share our commitment. To date we haven’t sourced Canadian calves yet, but we most certainly intend to, especially with the plan to distribute in Canada as I just mentioned. But there certainly is a lot of growth in the bison industry in Canada I’ve noticed.

CMB: More and more attention is being paid to the nutritional value of bison meat.

MT: I agree. People are starting to see that this is an animal that bodes well for the environment and for the body and it is a really healthy protein with less cholesterol. We have a lot of high performance athletes as well who use our bison bars. For example, we created a Warrior bar because we saw the demand in the sports world.

CMB: How many products do you currently produce under the Tanka Bar brand?

MT: Currently we’re producing 17 products and were still growing. It’s very exciting for us right now and actually it is an exciting time to be in the buffalo business period.

CMB: What are the longer term plans for Tanka Bar? MT: I think if we look that far out, projections for us it would be securing a partnership that could facilitate the growth of Tanka Bars into an international brand. But we will continue our commitment to drive the growth of our brand back into native communities by providing a healthy food product while at the same time restoring the buffalo herds and revitalizing our prairie grasslands. meatbusiness.ca

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201 Don Park Road, Unit 1 Markham, Ontario L3R 1C2 Phone: 1-800-465-3536 or 905-470-1135 Fax: 905-470-8417 Email: sales@yesgroup.ca www.yesgroup.ca September/October 2016 CANADIAN MEAT BUSINESS

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