Canadian Meat Business May/June

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IN THIS ISSUE May/June 2016

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What is Wrong With This Picture?

By Cam Patteron

Help Wanted!

By Scott Taylor

Proper Animal Care and Welfare is Paramount in the Beef Industry

By Tom Lynch-Staunton

Earls Kitchen + Bar Stumbles Badly

By Chuck Jolley

IFFA 2016 Sets New Records

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Belmont Meats Celebrates 50 Years 2016 Burger Battle

By Ronnie P. Cons

McDonald’s Stock Reaches All-time High CFIB: Immigrants Are the Solution to Canada’s Labour Shortage

By Dan Kelly

Beef Industry Praises TPP Benefits

May/June 2016 CANADIAN MEAT BUSINESS 3

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2016

meatbusiness.ca

GUEST EDITORIAL

May/June 2016 Volume 15 Number 3

PUBLISHER Ray Blumenfeld ray@meatbusiness.ca MANAGING EDITOR Scott Taylor publishing@meatbusiness.ca DIGITAL MEDIA EDITOR Cam Patterson cam@meatbusiness.ca CONTRIBUTING WRITERS Scott Taylor, Chuck Jolley, Dan Kelly, Ronnie P. Cons, Tom Lynch-Staunton 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.

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WHAT IS WRONG WITH THIS PICTURE?

By Cam Patterson I’m going out on a limb here to say the Earls bomb that recently exploded in our industry and ignited a social media lynching was more than just a poorly planned promotional idea. It ran completely contrary to the pride we have for our world class Canadian beef and it also brought to light one of the most overlooked aspects of our industry that is quickly becoming the bane of the food industry overall and that is our ability to remain insular.

In this era of social media and a 24 hours news cycle, this mode of operating isn’t good enough anymore.

Another word that has a substantial impact our industry is millennials - a term applied to the youth who are ever more aware and demanding the food they consume not only be nutritious – and the labeling better show that accurately – but also raised ethically and slaughtered humanely. Millennials are defining the direction of this generation much like hippies did in the 1960s and look what they did to change human rights, demand world peace, ignite the environmental movement, etc.

Millennials are the reason Earls and other restaurant chains have combined the nightlife experience with gourmet steak dining and have had to pay attention and they focus their attention on this demographic. Yes, us older steak eaters go there as well but let’s be honest, these chains are marketing to a younger crowd who are concerned and vocal about animal rights and food quality issues.

How does insular play into the modern day food industry? Some may defend that position as blasphemous because Canada is at the leading edge of sustainability, humane treatment of animals, and we’ve set the bar with bio security. We’ve forged ahead with ground breaking initiatives to secure better deals for our exported product.

That is all well and good but we’re still only devising methods and tracking to report to industry watch dogs and satisfy trading partners. We’re basically being accountable to the stakeholders within the industry and hence we’ve insulated ourselves from the consumer. What have we done to show the average Canadian consumer the landmark strides we’ve made to ensure Canada’s beef is setting the standard around the world?

In my opinion, almost nothing.

Other than A&W’s slate of ads offering beef raised without hormones, there are no real visible ad campaigns targeted directly at consumers. Certainly Earls and their competitors are not doing it. They’re promoting the experience, not the food, so it’s not their job to do that for Canadian beef. It’s our job as an industry to develop a visible, effective campaign that millennials can identify with and to spread the word of the great job we’re really doing.

Perhaps in our drive to meet government standards mostly aimed at securing exports, we’ve overlooked the fact we still need to clue the millennials into the idea of the progress our industry has made.

Otherwise, we’re still just operating within the industry. Because at the end of the day, I think that is all Earls was looking for and couldn’t find.

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May/June 2016 CANADIAN MEAT BUSINESS 5

HELP WANTED!

By Scott Taylor

You want a permanent, full-time, high-paying job with great benefits? The meat industry in Canada has thousands. That’s right, thousands. Fact is, there are so many great jobs available in Canada’s beef, pork and poultry industries that the producers can’t fill all the positions that are available now and there is a very good chance that they might never be filled. If you’re unemployed, become a butcher or a cowboy. You will never be unemployed again.

Late last year, the Canadian Agricultural Human Resource Council and the Conference Board of Canada released a Labour Market Information Study or LMIS.

However, this study was relevant. And also a little bit frightening. It also drove home a reality that people in the beef, pork and poultry industries have been living for years.

Sure, we all know that there all kinds of studies on all kinds of subjects floating around this country and many of them – if not most of them – are gathering dust on some shelf in some government library.

This particular LMIS put an exclamation point on the fact that labour shortages (both skilled and unskilled) are having a significant impact on Canada’s agriculture sector and Canada’s beef, pork and poultry industries are seeing

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shocking vacancies throughout the value chain - from the farm, ranch and feedlot level right through to the processors.

And if you think the word “frightening” is a little hyperbolic, think again. This shortage of labour is not just a corporate problem, but one that has almost solely been created by government restrictions and regulations.

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“The meat industry is not homogenous,” said Ron Davidson, the Director of International Trade, Government and Media Relations for the Canada Meat Council (CMC). “First, it includes facilities in rural locations, particularly abattoirs and slaughterhouses, and it also includes facilities in urban locations, particularly further processing facilities.

“Ensuring sufficient workers is rarely an easy endeavor for any meat packing or processing plant. However, the most severe implications of government-imposed restraints on access to labour are experienced by establishments situated in rural locations in which the meat plant is frequently either the largest or one of the largest employers in the region. Particularly for operations located in rural Canada, the repercussions are grave for farmers, for meat packers, for workers, and for rural municipalities.”

According to Davidson, “The industry recruits aggressively, constantly and nationally,” and still it can’t find enough people to fill the vacant positions. In fact, it isn’t even close.

“ NOTWITHSTANDING

THESE BENEFITS, THERE IS A CHRONIC UNDER-SUPPLY OF BUTCHERS AND MEAT CUTTERS EVERYWHERE IN CANADA AND, AMONG THOSE WHO ARE INTERESTED IN THE OCCUPATION, ONLY MINIMAL NUMBERS WHO ARE WILLING TO RELOCATE TO A RURAL ENVIRONMENT”

“Scouring the country in search of the unemployed, new immigrants, refugees, indigenous people and youth is not a new endeavor for the meat industry,” Davidson explained.

“This has been an everyday practice for many years.”

And what does the industry offer? According to the CMC it’s quite outstanding: “The industry offers jobs that are fulltime, not part-time with substantive training. Incomes are well in excess of minimum wages with periodic increments and opportunity for advancement. There is a very comprehensive suite of medical, dental, vision, insurance and retirement benefits and, for most workers, immediate membership into a strong union (e.g., United Food and Commercial Workers).”

“Notwithstanding these benefits, there is a chronic under-supply of butchers and meat cutters everywhere in Canada and, among those who are interested in the occupation, only minimal numbers who are willing to relocate to a rural environment,” Davidson continued “I would invite anyone to enter the Employment and Social Development Canada home page, type ‘butcher’ and subsequently ‘meat’ in the Job Finder. The first will result in a list of several - usually five - pages of employers, mostly retail outlets in urban locations, seeking butchers as well as others like meat companies in rural locations. These meat companies often seek as many as 100 butchers for a single plant. The government needs only to consult its own website to substantiate that there is a chronically insufficient supply of butchers in Canada to satisfy urban demand without even considering hundreds of unfilled positions in rural locations.”

Sadly, not only do government programs not require that unemployed Canadians relocate to rural regions to accept job offers, some government programs constitute strong incentives (access to government supports and services etc.) to remain in

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urban environments regardless of the absence of work.

“In essence, current government policies have, to some extent, the effect of downloading urban unemployment challenges onto the shoulders of rural businesses and rural communities,” Davidson said. “Government policy-makers express concern about the possibility that a meat packing plant may close.

There would appear to be a lower intensity of concern that current policies are resulting in the slow suffocation of both companies and rural communities.”

If you haven’t figure it out yet, a shortage of labour in the meat industry is not just a problem, it’s a crisis.

The LMIS found that annual farm cash receipt losses to Canadian producers due to job vacancies are $1.5 billion or three per cent of the industry’s total value in sales and production. We don’t need to tell anyone, that that has a significant impact not just on the agriculture sector, but on the entire Canadian economy.

In fact, again according to the LMIS, in 2014, unfilled vacancies cost the Canadian beef industry alone $141 million in sales (farm gate cash receipts).

The CAHRC also reported that the current gap between labour demand and the domestic workforce is 59,000 people and projections are showing that by 2025, the Canadian agriworkforce could be short workers for 114,000 jobs. Say that number slowly – one hundred and fourteen thousand jobs.

“On the beef side, the LMIS has indicated that over the next 10 years, the labour gap in the Canadian beef cattle industry could widen to 12,500 workers,” said Brian Lemon, spokesman for Manitoba Beef. “A significant reason for this is that our beef producers are getting older. We could see up to one-third of the current workforce retire over the next 10 years. We need to find effective strategies to meet this very serious challenge.

“Some have estimated that there are currently upward of 1,000 job vacancies alone in Canada’s meat processing sector right now, not counting the vacancies at the farm or feedlot level,” Lemmon added. “This can result in lost opportunities when these plants are not running at full capacity. You can end up in a situation where Canadian food, including cattle, may be sent to the United States or Mexico for processing, only to come back as an imported product. That can cost Canadians more money at the grocery store. It also translates into exported jobs and economic opportunities when those cattle are processed outside Canada.”

There are other problems, as well. According to Lemon, when plants in Canada are unable to run at full capacity, it can result in a reduction in the production of lucrative value-added items and the potential to export those items to existing or emerging markets.

“It’s very important to the future of the Canadian beef industry that we can retain and fully utilize this processing capacity at home,” Lemon said. “It’s a critical component of our 8 CANADIAN MEAT BUSINESS May/June 2016

industry’s value chain, helping us supply both our domestic and international markets with our high quality Canadian beef.

“As well, there have been significant efforts by governments to achieve new or increased market access for Canadian products, such as the Trans-Pacific Partnership or the Canada-EU Comprehensive Economic and Trade Agreement.

We’ll need to raise more cattle to help supply our high quality Canadian beef, cattle and genetics into these various markets. At the farm or ranch level, there will be producers wishing to expand their operations to take advantage of these opportunities. However, to move forward from a position of confidence, they need to know that they will have access to those extra sets of hands on their operations when they need them. We don’t want to forfeit these opportunities.”

“ SOME HAVE ESTIMATED THAT THERE ARE CURRENTLY UPWARD OF 1,000 JOB VACANCIES ALONE IN CANADA’S MEAT PROCESSING SECTOR RIGHT NOW, NOT COUNTING THE VACANCIES AT THE FARM OR FEEDLOT LEVEL” It is also discouraging to note that the Canadian government has agreed that Canada’s meat industry is suffering from what it calls, “a permanent worker shortage.” And yet, there is now a federal cap on the number of low-skilled workers in Canada.

As of July 1, 2015, the number of low-skilled foreign workers that employers can hire will be capped at 20 per cent. The reduction in foreign workers was announced last June by then Employment Minister Jason Kenney — at the height of public criticism over reports of abuse within the Temporary Foreign Worker program. That cap is slated to drop, again, to 10 per cent by July 1, of this year.

The cause of this unfortunate situation had little or nothing to do with the meat or the overall agricultural industries. Turns out, it was a series of abuse scandals in 2013-2014, primarily in the fast-food service and banking industries, that got the Conservative government of Stephen Harper in hot water.

Canadians were said to be furious that temporary foreign workers were being brought in by certain companies in lieu of hiring locally.

One company, the Royal Bank of Canada, was actually accused of firing Canadian employees in order to outsource jobs to foreign workers. That one transgression started a public relations nightmare for both the bank and the federal government.

Still, at least in the meat industry business, there are plenty of great jobs for unemployed Canadians, and yet it is difficult to understand why there isn’t a lineup to get training and take advantage of what is already a grave labour-shortage situation. Many qualified people could almost write their own tickets, as they say.

Continued on page 10 meatbusiness.ca

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May/June 2016 CANADIAN MEAT BUSINESS 9

“Canadians are becoming older, more urbanized, more highly educated, and significantly less willing to accept jobs in rural communities,” said Davidson. “In addition to the industry maintaining the current practice of aggressive, continuous and national recruitment and training, the industry must be provided with the option of seeking foreign origin workers when it has been demonstrated that there are insufficient numbers of Canadians who are willing to fill vacant positions.

This outcome can be achieved by a variety of options, including but not limited to, federal and provincial pathways to permanency and eligibility of chronically undersupplied occupations for Express Entry.”

“ ANALYSIS HAS SHOWN THAT FOR EVERY WORKER EMPLOYED IN THE BEEF SECTOR ANOTHER 4.2 WORKERS ARE EMPLOYED IN CANADA (COUNTING DIRECT AND INDIRECT IMPACTS) AND ALMOST 7 WORKERS ARE EMPLOYED IF ALL IMPACTS ARE INCLUDED,” LEMON ADDED. “THAT REALLY DEMONSTRATES THE IMPORTANCE OF THE BEEF INDUSTRY ALONE TO THE ECONOMY.”

Leaders in the meat industry agree that there are plenty of solutions. They just wish more people, especially at the federal government level, were listening. After all, as Lemon points out, we cannot understate how important having a strong agriculture and agri-food system is to the Canadian economy.

Fact is, that industry accounted for one-in-eight Canadian jobs in 2012, in areas ranging from primary production to food and beverage processing to foodservice and more.

“Analysis has shown that for every worker employed in the beef sector another 4.2 workers are employed in Canada (counting direct and indirect impacts) and almost 7 workers are employed if all impacts are included,” Lemon added. “That really demonstrates the importance of the beef industry alone to the economy.”

Of course, this isn’t just a beef issue. It’s a problem right across the spectrum. In fact, because of a labour shortage in the pork industry, fewer sows are being bred and thus, fewer piglets are being born. These are shortfalls that trickle down

the supply chain and hurt the processing plant.

However, most leaders in the meat industry are convinced that there are ways to make the labour shortage go away. At least, in the stunning numbers that exist today.

“The need for a solution to the labour shortage issue is imperative,” said Brady Stadnicki from the Canadian Cattlemen’s Association. “With increased trade opportunities looming and the average age of cattle producers rising to the point where 15-20 per cent of them will retire in the next 10 years, the demand for labour in the beef industry is likely to increase substantially in the future.

“One solution that all segments of agriculture and primary processing stand behind is the implementation of recommendations made by the Labour Task Force’s Agriculture and Agri-Food Workforce Action Plan (WAP). The WAP addresses the needs to increase the labour supply of skilled and unskilled workers, and improve the knowledge and skills of workers in the industry.

“The profitability of the beef industry is also key to ensure new entrants choose to make their living by raising cattle.

A competitive business and regulatory environment, market access and continued research and innovation are integral to a profitable beef industry. CCA initiatives such as the Cattlemen Young Leaders program and Young Cattlemen’s Council are working to encourage new entrants into the beef cattle industry and develop leadership and policies that will help transition the next generation of beef producers into the industry.”

According to Davidson, “Canadian negotiators have obtained major new opportunities to increase meat exports and the associated expansion in employment and economic growth in rural municipalities.

“Unfortunately, the opportunities that have been paid for and opened by government trade negotiators on one hand are being nullified by government policies on the other hand that prevent expansion of the industry to take advantage of the new export opportunities. Feed grain farmers, livestock producers, and meat packers and processors want to move forward. What is required is a government policy framework that will catalyze rural expansion rather than rural retraction.”

According to Jennifer MacDonald, past chair of New Brunswick Cattle Producers, the short term solution is simple: “Allow the industry to access more foreign workers.”

“Long term we need to encourage immigration for these fields,” she said. “And we need to encourage Canadians to consider this line of work, although, to be fair, this line of work is not for everyone.”

Perhaps not, but if you’re a healthy Canadian looking for a good job, a future in the meat industry – no matter whether it’s beef, pork or poultry or where it happens to be on the supply chain – is a solid investment in your future. If you really want to work, there is a job in this industry for you.

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PROPER ANIMAL CARE AND WELFARE IS PARAMOUNT IN THE BEEF INDUSTRY

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

Recently Earls, a Canadian restaurant chain, announced that they would only be sourcing “Certified Humane,” antibiotic, hormone, and steroid free beef, which they claim they could only find on in their necessary volumes from U.S. suppliers.

Unfortunately, this campaign, is not only misinformed, but invariably condemns Canadian beef production, implying that Canadian producers are not caring for their animals properly. In addition, these marketing campaigns take advantage of consumer’s anxieties and worries, fueled by a lack of connection and knowledge (which isn’t the consumer’s fault) about how cattle are raised.

For example, all beef in Canada is antibiotic free, because of strict rules ensuring an animal is not slaughtered before an antibiotic, if given, is metabolized. Certified Humane rules do allow for treatment of individual animals, but no more, which can result in a whole herd welfare issue, especially if a sickness spreads without herd treatment.

Hormonal growth promotants, which are prohibited in the Certified Humane label have no negative effects on animal health and welfare, but do have positive effects on the environment, including improving resource use efficiency (less feed and water per kilogram of beef produced) and reducing greenhouse gas emissions from cattle.

Proper animal care and welfare is paramount in the beef industry, and producers continue to ensure the best life possible for their livestock. This proactive approach includes maintaining animal health, minimizing stress when handling, treating, or transporting animals, and continually updating and improving practices.

There are many progressive initiatives underway in the Canadian beef industry to ensure cattle have the best life possible before they are processed meatbusiness.ca

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May/June 2016 CANADIAN MEAT BUSINESS 11

into meat. Some of the rules in place for proper animal care are mandated through government, but most are industry led programs which are very important because they show how much producers care about their animals, and also producers’ motivation and initiative to improve their own practices.

For example, the industry’s updated Code of Practice for the Care and Handling of Beef cattle was released in 2013 (https://www.nfacc.ca/pdfs/codes/beef_code_of_practice. pdf). The Code clearly outlines industry expectations, in line with global best practices, with respect to how cattle should be raised and cared for (summarized on page 56 of the Code).

The Code was developed proactively by industry, working with the National Farm Animal Care Council (which includes representation from the Canadian Federation of Humane Societies), and was open for public comment before it was finalized and published.

The industry is also improving the way that cattle are handled, particularly with “low stress handling techniques,” developed through insight and ideas from leading animal welfare and handling experts like Dr. Temple Grandin, Bud Williams, and Dylan Biggs. For example, animal handling and penning systems designed by Temple Grandin have been adopted at all the major packing plants for beef in Canada. A focus on low stress cattle handling has resulted in new chute design, treatment facilities, and transport practices to reduce stress, as well as reduction or elimination of electric prods, increased adoption of low stress weaning techniques, proper bedding in feedlots for warmth and comfort, and many other handling initiatives.

Tom Lynch-Staunton,

Other significant advances have also been made in cattle health, with respect to proper nutrition and water quality, vaccinations and health protocols, the continued responsible use of antibiotics for treating sick animals, and new rules requiring pain mitigation (anesthetics or analgesics) for stressful procedures. These have been incorporated into the Beef Code of Practice and are being promoted across the industry. Producers are even breeding cattle to ensure a body conformation that enables cows to have their calves easily, that cattle are calm in temperament or are born without horns via polled genetics. Reducing horns in a herd greatly reduces the potential for bruising and injury to other animals, as well as to the producers who care for them.

When a Canadian rancher or feedlot operator loads their cattle for transport to the processors, they take consolation in knowing they gave those cattle the best life possible, that their cattle’s death will be as quick, painless, and stress-free as possible, and that they are helping to feed many people a nutrient dense and healthy food.

Many activists target the beef industry about animal welfare.

What they fail to understand is that animal care and welfare is a passionate issue for producers too. In effect, they are on on-call 24/7, be it to monitor an animal showing sudden signs of potential illness, or to help a heifer having a difficult birth to deliver a calf safely – even in the middle of the night, or to provide extra feed and bedding on the coldest of winter days to ensure the animals have the energy they require to stay healthy. Animal care is an all-consuming occupation for beef producers. Not only is it a matter of compassion, but healthy and content animals ensure the farm remains viable and productive in the long term.

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EARLS KITCHEN + BAR STUMBLES BADLY

by Chuck Jolley

Several years ago, Earls Kitchen + Bar made a decision to start consciously sourcing their food. “That’s why all our beef is raised without the use of antibiotics, added hormones, or steroids and comes from Certified Humane® farms. After all, it doesn’t just feel good to do the right thing, it feels good too,” says a headline on their home page.

That oddly worded statement should have been a tip-off that things weren’t going well. On April 28th they announced a poorly considered decision to abandon their traditional Canadian beef resources for Certified Humane meat from Creekstone Farms Premium Beef in Kansas. Their Charlie Chaplin-like trip, stumble and fall from grace started with the wording of an emailed announcement from Earls’ spokesperson, Cate Simpson.

worked, too. Simpson acknowledged traffic in their Alberta restaurants was down significantly.

Continued on page 14

She wrote that Earls had done “intensive research and testing for over two years trying to use Certified Humane beef from Alberta, raised without antibiotics, steroids or growth hormones. But the company needed a supplier who could reliably provide over two million pounds of beef a year.”

Simpson said “There was (and is) simply not enough Certified Humane, antibiotic, steroid free beef in Alberta to meet the volume we use and those we tried were unable to consistently meet our supply needs, not even a portion of it.”

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“Not even a portion of it?’ That was the comment that Alberta’s cattlemen seized on as a direct slap in the face.

They overlooked her thinly made promise of “In the future, should the volume of beef we source in Canada move to Certified Humane, raised without antibiotics, steroids or growth hormones, we will absolutely revisit our suppliers.”

A firestorm of protest erupted, rivaling that of the terrible wildfires consuming much of the area around Fort McMurray.

The flames were fiercest and unforgiving on social media. A WTH tweet storm erupted, calling for an immediate boycott and rallying around #boycottearls hashtag. It seems to have meatbusiness.ca

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Rob McNabb, general manager of the Canadian Cattlemen’s Association, expressed his disappointment with Earls, at the same time partially acknowledging the validity behind Earls decision.

is emulating Chipotle - in a ‘purist’ context - by aiming to win public kudos and patronage, but at the risk of incurring resentment and wrath from Canadian cattle producers who see Earls showing disdain for their beef.”

“We’re just not quite ready to provide the level of documentation they’re looking for,” he told the Calgary Herald. “But our intent is to meet the market needs as quickly as we can and offer even a broader program.”

He said, “I have always had great respect for Canadian Cattlemens Association - and believe their standards of animal welfare have mostly been high, without accepting formal rules. They have gone above the standards of the U.S. producer organizations by accepting a need to observe animal ID and traceback rules (maybe not 100%) but, apparently they share the same reluctance to accept binding rules for animal welfare - simply on their principle of ‘not wanting anyone telling us how to operate our business.’

Alberta’s premier Rachel Notley also talked about the delay in finalizing Canadian standards that led to Earls ill-fated abandonment of her province’s beef. “I am certainly hopeful that the round-table on the certification around organics, that has been set up nationally, can move quickly to come up with a certification process that confirms what we all know to be true that Alberta produces great beef,” she said.

The Backtrack Faced with both a political and social smack down, Earls yanked a table cloth off one of their suddenly empty tables and fashioned it into a white flag. On Wednesday morning May 4th, the company issued a clarifying statement saying they are “committed to sourcing as much beef as possible from Alberta” and will work with producers to build a supply of beef that meets their criteria.

Goodsir warned that “Earls Restaurant chain obviously is challenging that attitude - and is garnering public support from many quarters - which is a rising trend in consumer attitudes across both US and Canada.”

He pointed out that there is a “growing demand for transparency about ‘where all of our food comes from’. All livestock producers face a need to accept more transparent rules and standards for animal welfare - if they want to win consumer trust in an increasingly challenging marketplace.”

Exactly what is Verified Humane?

In a video follow up, a chastised Mo Jessa, Earls’ President, admitted “We made a mistake. We should have worked with local ranchers to find product that met our criteria. I assure you that we’re going to do everything in our power to find local ranchers, work with them to get Canadian beef back into Earls and do it quickly.

A few Alberta producers are Certified Humane by Humane Farm Animal Care, an American non-profit organization.

It is not the only certification program, though, and there was some immediate confusion that beef not a part of the program was not being raised humanely or might be unsafe to eat.

There’s is no question in my mind that Alberta beef and Canadian beef is some of the best beef in the world. If there’s one good thing that has come out of this, it’s that local ranchers are reaching out to us and they’re going to try to help us meet criteria that we need to get that beef onto Earls’ menu. I’m very optimistic that will happen.”

Adele Douglass, founder and chief exec of the non-profit Humane Farm Animal Care organization, compared the current Canadian codes of practice with Certified Humane.

“Canadian codes are guidelines that are not enforced through inspection, unlike our standards. We require third party audits, self-certification is not permitted.

Jessa said, “Certified Humane means that we were looking for certification that validates cattle are raised humanely.

The standards in Alberta are very high, nothing is more important to me than to let beef producers all over Canada know that we understand their standards are high.”

“Beef certified by our program is raised without the use of antibiotics, steroids or added hormones, and slaughtered according to the specifications of animal welfare expert Dr. Temple Grandin. While our standards don’t permit antibiotics for growth or feed efficiency, they can be used therapeutically as directed by a veterinarian. To not treat a sick animal would be inhumane,” she said.

To be specific, something that had evaded Earls’ spokespeople, the reversal is not complete and immediate.

Instead, it’s a pledge to use Canadian sources to supplement the Certified Humane beef they’ll continue to buy from Creekstone Farms. There simply isn’t enough Canadian product available to meet the two million pounds of steaks and ground beef per year required by the chain.

As supplies from Alberta and Saskatchewan ramp up, they should slowly return to a home-based supply.

What was behind the decision to abandon Alberta?

Douglass thinks it should be relatively easy to meet Earls’ standards right now. “All a producer needs to do is to become Certified Humane,” she said. “We already have several Canadian members including duBreton Natural Pork, L. P. Farm Fresh Chicken, Sun Rise Farms and Open Farm.”

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.

Graeme Goodsir, a beef industry expert with lengthy experience in Canada and the U.S., said “I consider Earls 14 CANADIAN MEAT BUSINESS May/June 2016

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IFFA 2016 SETS NEW RECORDS Over 63,000 trade visitors from 143 countries attended IFFA in Frankfurt from May 7-12.

This was an increase of around five percent over the previous event in 2013 which saw 60,509 visitors from 144 countries.

IFFA saw an increased degree of international participation which rose to a new record level of around 66 percent.

Particularly well represented on the visitor side were the Russian Federation, Spain, Poland and Italy.

IFFA 2016 also set a new record on the exhibitor side with a total of 1,027 companies taking part. The exhibitors, who came from 51 different countries, presented innovations for the entire meat-processing chain. On 110,000 square metres of exhibition space, they presented new products and technologies for slaughtering, dismembering, processing, packaging and sales.

“Under the motto ‘Meet the Best!’, the entire sector came together here in Frankfurt to discover the latest innovations and tomorrow’s trends. IFFA is and will remain the world’s leading trade fair for the meat industry. This year, it was distinguished by growth in all respects. An extraordinarily high level of internationality, the presence of all market leaders and highly innovative products and technologies speak for themselves”, said Wolfgang Marzin, President and Chief Executive Officer (CEO) of Messe Frankfurt.

The focus of IFFA is on innovative and creative solutions for the safe, efficient and economic production of meat and meat products. For manufacturers of machinery and plant, IFFA is the leading international trade fair and offers the biggest expert network – a special incentive for companies to make their innovations ready for launching on the occasion of the fair. Klaus Schröter, Chairman of the Meat Processing Machines Group of the Federation of German Machine and Plant Manufacturers, summarized the situation for his membership saying, “The German Machine Manufacturing Industry is very pleased with the results of this year’s IFFA. Numerous new contacts were made and many contracts concluded, several of them for large-scale projects. Increasing meat consumption worldwide is the driving force behind this. And this was also reflected by the high standard of visitors, most of them top international decision makers. Our foreign customers are enthusiastic about the new technologies and the broad product portfolio, which is more diverse than at any other event in the world and makes IFFA unparalleled.”

IFFA is also a must for the butchers’ trade, one of the biggest groups of visitors. Heinz-Werner Suess, President of the German Butchers’ Association was delighted with the results of the fair: “Overall, IFFA was an excellent opportunity for us and our partners to show our strengths. After the six-day fair, our opinion remains unchanged: it was an extremely potent presentation for both visitors and representatives of the German butchers’ trade at this, the world’s leading trade fair for the meat-processing business.”

VISITORS FROM 143 COUNTRIES IN ATTENDANCE AT IFFA 2016 IFFA set a new international visitor record as the top ten foreign visitor nations were the Russian Federation, Spain, Poland, Italy, the Netherlands, China, the USA, Austria, Australia and the Ukraine. High rates of growth within Europe were noted from Spain, Poland, the United Kingdom, Ireland, Romania and Greece. From outside Europe, there were significantly more visitors from the Ukraine, China, the USA, Japan and South Africa.

VISITORS AND EXHIBITORS HIGHLY SATISFIED A Messe Frankfurt poll showed that both exhibitors and visitors gave the fair an extremely positive rating as 97 percent of visitors said they had achieved their goals for the fair. At the same time, 91 percent said the economic climate in the sector is good. The biggest groups of visitors came from the food retail trade, the meat-processing industry and the butchers’ trade. On the exhibitor side, 87 percent of companies said they had achieved their targets for the fair; 81 percent said they had reached their visitor target groups. Almost 60 percent of exhibitors were pleased with the number of German visitors.

At the same time, their satisfaction with the standard of visitors rose three percentage points to 77 percent. 89 percent of exhibitors rated the current economic situation in the sector positively.

THE TOP MEAT-INDUSTRY SUBJECTS AT IFFA What makes IFFA unrivalled as the world’s leading trade fair for the sector is its clear focus: everything revolves around meat.

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The emphasis is on innovations and trends that cater for market demand and generate decisive impulses for shaping the future. The current trends were reflected by the extensive range of products and services offered by the exhibitors.

Important subjects in the case of machines and plant for processing and packing meat and meat products are quality and the increasing demands on product safety and traceability.

Additionally, there is a clear focus on improving productivity through greater energy efficiency, higher output, simple cleaning processing, increasing automation and environmentallyfriendly solutions.

In the butchers’ trade, the aim is to tap into new developments in consumer eating habits, i.e., convenience, ‘snacks to go’ and meat-substitute products.

Investments in energy efficiency and the simplification of working processes are other top issues in the trade.

In the case of companies from the ingredients and additives segment, the spotlight is on food trends and the nutritional ‘zeitgeist’. ‘Clean labelling’ has been a leading trend in the meat industry for many years and reflects the demands of consumers and the trade for products with as few additives as possible. Another important subject is salt reduction with no loss of taste.

MULTI-FACETED COMPLEMENTARY PROGRAMME OF EVENTS In addition to the new products and innovations being shown by exhibitors, IFFA was characterised by a multi-faceted complementary programme of events focusing on current developments in the sector.

Expert lectures with best-practice examples at the IFFA Forum, special exhibitions, panel discussions, such as IFFA Talk, and the international quality competitions gave visitors a great opportunity to gather information, hold discussions and make new contacts.

The next IFFA will be held in Frankfurt from May 4-9, 2019.

Turn to page 22 to view more photos from IFFA 2016.

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May/June 2016 CANADIAN MEAT BUSINESS 17

BEEF INDUSTRY PRAISES TPP BENEFITS The Canadian Cattlemen’s Association (CCA) has reported that beef industry representatives from B.C., Alberta, Saskatchewan, and Manitoba appeared before the Standing Committee on International Trade (CIIT) last month to detail the benefits of the Trans-Pacific Partnership (TPP) to the sector in their respective provinces.

The CCA provincial member associations participated as witnesses in the CIIT field hearings along with representatives from other agricultural commodity groups, industries, and stakeholders from the Western Canadian provinces. The hearings, held in Vancouver, Calgary, Saskatoon, and Winnipeg from April 18-22, are part of International Trade Minister Chrystia Freeland’s ongoing public consultation process on the TPP. While Canada has signed the TPP, it has yet to ratify the groundbreaking, 12-country trade agreement, opting to first consider the opinions of a broad swath of citizenry and business through a nation-sweeping consultative process.

The TPP marks a significant breakthrough for the beef industry as, once ratified, it will level the playing field for access to Japan for Canadian beef. The Japanese tariff on Canadian beef will immediately match the rate for Australia and then decrease to nine per cent over 15 years. With the TPP, Canada’s beef industry can double or nearly triple its exports to Japan to about $300 million per year.

In Vancouver, B.C. Cattlemen’s Association (BCCA) Executive Director Kevin Boon said the beef cattle industry is very supportive of the ratification of the TPP trade 18 CANADIAN MEAT BUSINESS May/June 2016

deal. B.C.’s beef industry sees tremendous value in the competitive market access the TPP will allow, which in turn will enable better cut-out value for their cattle.

The B.C. beef industry’s lone concern about TPP is that it might not be implemented, Boon said. According to the agreement’s implementation formula, the TPP cannot come into effect without the U.S. With the U.S. currently caught up in the 2016 primary elections, it is not yet certain if support for the TPP will carry forward following the U.S. presidential election. Canada needs to have strategies in place to secure trade with Japan should the U.S. support not materialize, Boon said. “It is unfair to Canadian exporters to have to try to compete with other countries who have achieved free trade agreements (FTAs),” he said.

In this case, Canada would need to establish a bilateral free trade agreement with Japan separate from the TPP. Without the TPP or a bilateral agreement with Japan, Canada will likely lose around 80 per cent of the value of its beef exports to Japan. In Calgary, Alberta Beef Producers (ABP) executive director Rich Smith underscored the need for Canada to ratify the TPP as soon as possible – and ideally before the U.S. presidential election. Market access meatbusiness.ca

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and trade are vital to the Alberta cattle and beef industry, which exports 86 per cent of its beef, he noted.

Already, Canada is seeing the effects of slipping into a competitive disadvantage to Australia, which has a FTA with Japan. Canadian beef is still subject to a 38.5 per cent tariff in Japan, while Australian beef is at 27.5 per cent and dropping. In 2015, the impact of the tariff disadvantage on exports of Canadian beef to Japan on a year-over-year basis amounted to a 24 per cent drop in tonnage to 14,000 tonnes and a 9.3 per cent drop in value to $93 million – with the loonie partially mitigating the impact.

A major priority for Canadian beef producers during the TPP negotiations was to ensure that the agreement would result in a level playing field for all beef competitors in the TPP region. In Saskatoon, Saskatchewan Cattlemen’s Association (SCA) Chair Ryan Beierbach addressed the value of the TPP in terms of access to potentially important markets like Vietnam. Widely anticipated to be a market of growing importance for beef in the future as their level of economic development increases, Vietnam’s existing tariff of 15 to 20 per cent on beef cuts will be fully eliminated under the TPP in three years, while its 10 per cent tariff on beef offals will be eliminated in five years.

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Malaysia has also been identified as a potentially important market and the TPP also addresses the exclusion of some beef access from a previous agreement with Peru.

In Winnipeg, Manitoba Beef Producers (MBP) President Heinz Reimer noted the spin-off benefits of the TPP go well beyond producers. In addition to supporting capacity at new and existing processing plants, others in the value chain, such as livestock transporters hauling to plants, would benefit as well.

The provincial beef association representatives also answered questions from panel members. In each city, the main topics of questioning for the beef sector were around the ability of Canada’s herd size to supply the export demand from these markets, the outlook for herd expansion, and potential impacts to the chronic shortage of skilled labour in agriculture. meatbusiness.ca

Join Today! www.cfib.ca/agri May/June 2016 CANADIAN MEAT BUSINESS 19

BELMONT MARKS MAJOR MILESTONE Belmont Meats of Toronto is celebrating its 50th anniversary in 2016 and continues to serve up a remarkable culinary success story.

Belmont’s commitment to quality and innovation has established a loyal customer base when it launched in 1966 and is fueling the company’s growth as a North American industry leader.

“We’re excited to mark such an important milestone this year and very proud of the legacy we’ve created as a company,” said Belmont CEO Paul Roach. “We believe in making safe, affordable, great-tasting food choices available to everyone.

We believe our purpose is to ensure this happens and to inspire others with the same beliefs.”

Belmont’s made-to-specification beef products — including a diverse line of premium burgers and steaks — can be found at top retailers, club stores, leading restaurants and foodservice distributors across North America and International markets as private label offerings and Belmont-branded solutions.

Belmont has earned a reputation as a leader for food innovation and putting healthy protein choices on the table. Belmont’s research and development team regularly cooks up creative solutions in the company’s restaurant-

style test kitchen.

“We’re always looking to come up with world-class flavour and develop products that not only capitalize on trends, but also sets them,” Roach said. “A focus on innovation means we can create personalized products that are made to specification, on trend and ahead of the curve.”

While Belmont is constantly carryout out research and testing new products, one thing that has not changed over the past 50 years is the company’s commitment to food safety. Belmont’s plant is federally inspected to meet the highest safety standards. Each phase of production is carefully monitored and protected using advanced safety technology, ensuring customers and their brands receive the highest degree of safety at every step. Belmont also insists its partners and suppliers exceed its robust food safety approvals, remain current in their own safety initiatives and comply with all regulatory certifications.

For more information, visit: www.belmontmeats.com

THE 2016 BURGER BATTLE PUTTING THE SIZZLE BACK INTO BURGER SALES

By Ronnie P. Cons

As the summer season approaches the managers of the grocery meat and poultry departments should be asking themselves the following: Are there any novel marketing and PR strategies that I can implement that can help drive meat sales this summer?

As the summer season approaches the managers of the grocery meat and poultry departments should be asking themselves the following: Are there any novel marketing and PR strategies that I can implement that can help drive meat sales this summer?

The answer is yes. This article will cover one specific strategy that can be very effective in garnering the meat department a lot of free PR, valuable exposure, generate an exciting attitude among its current clients and attract many new ones.

This can be all be achieved by having the meat department organize their own local “The 2016 Burger Battle”. The Burger 20 CANADIAN MEAT BUSINESS May/June 2016

Battle is in essence an invitation to the public to enter into a competition to see who can barbecue up the best tasting and original burger. Here is a framework to follow: •

The event should be set for a particular date and will be held in a reserved section of the grocery parking lot already cleared by security.

•

The event will be marketed with posters located in the meat department as well as in some print media and emailing to contacts and through publicity releases to get free exposure in the newspapers, radio and hopefully local television.

•

Contestants are invited to enter by registering their meatbusiness.ca

names online or by phone. All contestants must purchase the meat ingredients from the grocery meat department, while the condiments will be supplied at no charge.

•

Judges will also be invited to register online and they will be from among the spectators.

•

Ten or so grills are rented for the day for the big Burger Battle event.

•

Each contestant chooses his recipe and makes at least five burgers to be divided and judged. The contestant writes out the name of his creation and recipe on a large sheet so the judges can take note of it.

•

The judges choose the five top winners who then go up and describe their original burger recipe.

•

Interviews and photos by local media are to be expected.

•

The meat department then places the photos of the winners in the meat department until next year’s competition.

Burger Battle recipes as well as discount vouchers for the ingredients and a little reminder to be ready for next year’s event.

A friendly Burger Battle – a great way to put the sizzle back into burger sales this summer.

Ronnie P. Cons is EVP of C&C Packing Inc., a leading Canadian distributor of meat and poultry. He can be reached at Rcons@CCpacking.com.

YesGroup_CanadianMeatBusiness-Qtr-pg.pdf 1 2014-05-16 1:20:17 PM

The results of this Burger Battle are many and exciting including: •

Free media exposure;

•

Successful positioning of the meat department as an exciting place which will help attract a younger market as well as the macho male barbecue master (almost every dad!);

•

The contestants, judges and other spectators will now be more excited and aware of delicious burger recipes leading to enhanced meat purchases for this summer’s barbecue season.

In essence, the meat department will have successfully created a buzz and an excitement over their department and their burgers which will have a carryover effect to their other meat and poultry items.

Lastly, as a follow up, the meat department can email all the registered contestants and judges and other spectators to thank them for participating. The email will contain the meatbusiness.ca

May/June 2016 CANADIAN MEAT BUSINESS 21

IFFA 2016 PHOTOS (CONTINUED FROM PAGE 16)

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MCDONALD’S STOCK REACHES ALL-TIME HIGH McDonald’s shares hit an all-time high Tuesday closing at a share price of $131.60 USD, up more than 10% this year.

Wall Street analysts are crediting the company’s all-day breakfast menu as well as the introduction of new products bratwurst in Milwaukee and garlic fries in San Francisco, have caught customer attention. The ongoing transition to cagefree eggs and improvement of protein quality have also helped to sustain the momentum.

McDonald’s has gained nearly 55% since Steve Easterbrook was promoted from chief brand officer to CEO in January 2015. Easterbrook, who officially took over in March 2015, quickly revamped the company’s menu, introducing newer customized sandwiches and all day breakfast options.

The fast-food giant’s stock has benefited from solid quarterly results that saw reported first-quarter earnings of $1.23 per share, on $5.9 billion in revenue.

McDonald’s is looking to boost sales in Asia, an area where McDonald’s has lagged. Many of the Asian markets it operates in are part of what McDonald’s calls its “high growth” segment. However, sales have been growing more rapidly in the U.S. and Europe lately.

The company recently said that it hopes to add more than 1,500 new McDonald’s restaurants in China, Hong Kong and Korea over the next five years. McDonald’s currently has over 2,800 locations in these three markets.

McDonald’s also said it is looking for more partners in Japan and Taiwan. The company’s goal is to own fewer restaurants itself. The long-term hope is that 95% of all restaurants around the world will be franchised.

Some analysts are also reporting that McDonald’s shouldn’t rest on its laurels just yet. While the burger chain is improving, other competitors aren’t too far behind as Wendy’s, Burger King, and Sonic as other quick-service restaurants that are performing well. meatbusiness.ca

May/June 2016 CANADIAN MEAT BUSINESS 23

IMMIGRANTS ARE THE SOLUTION TO CANADA’S LABOUR SHORTAGE

by Dan Kelly, President Canadian Federation of Independent Business (CFIB)

With Canada’s economy still stuck in what is best described as neutral, you would think Canadian workers would be clamoring to scoop up what are reported to be scarce jobs across the country.

We know there has been an exodus of workers beating a path towards the Calgary airport as the battered oil patch bleeds jobs and sends workers back to their home provinces.

We’ve seen this kind of labour mobility reversal before and

will likely see it again as the resource sectors continue to go through boom-and-bust cycles, changing the patterns of labour market mobility within Canada.

But this kind of high-profile migration obscures the fact that localized and regionalized labour market shortages Continued on page 26

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are in still in play in many locations across the country, including Alberta, Saskatchewan and Newfoundland and Labrador. Employers continue to struggle to match open positions with qualified (and available) job candidates.

A 2014 report by Miner Management Consultants estimates a labour force shortage of close to 2 million workers in Canada by 2031. That’s an entire major city’s worth of workers. It is also important to note that many positions continue to sit vacant today in semi- or lower-skilled occupational job categories in which Canadians are not lining up to work. Many of which are in the agriculture and agri-food sector, including 90,000 anticipated shortages in agriculture and 32,500 anticipated in food processing, as of 2015.

“ A 2014 REPORT BY MINER MANAGEMENT CONSULTANTS ESTIMATES A LABOUR FORCE SHORTAGE OF CLOSE TO 2 MILLION WORKERS IN CANADA BY 2031.

THAT’S AN ENTIRE MAJOR CITY’S WORTH OF WORKERS.”

It must be remembered that the official unemployment rate of 7.3 per cent only tells part of the labour story. The other part shows that the current job vacancy rate is 2.5 per cent, representing some 316,000 open full-time, part-time and temporary positions.

Although the vacancy rate is down from the fourth quarter of 2015, it shows that employers still have a hard time filling roles across all skill levels and sectors. This makes sense.

A skilled oil-field services worker used to making $80,000 per year is not lining up to move to a rural community to take a job in a slaughter house or processing plant.

We also have the other phenomenon of our system pushing young people to achieve higher and higher levels of education, only to find they cannot find related employment despite their mountains of debt. While teaching is a noble profession, we continue to stream (and fund) thousands of young people into university education programs despite grim job prospects.

I’m pleased to report the new federal government is showing signs it better understands the disconnect between labour shortages and the unemployment rate than the previous one.

While the federal government has indicated it will conduct a wholesale review of the Temporary Foreign Worker Program (TFWP), they also announced last month that they would temporarily ease restrictions for seasonal industries that use the TFWP, allowing them to bring in an unlimited number of workers for up to 180 days.

26 CANADIAN MEAT BUSINESS May/June 2016

One of these days we’re going to have to admit that even with wage hikes, terrific employers and focused recruiting, most Canadians remain unlikely to consider working at a fish plant or as a meat cutter, or even cleaning rooms at a hotel. If we’re not going to take these jobs or encourage our kids to consider these jobs (but we still want these businesses in Canada), then we’re best to allow some folks from elsewhere to come and take them.

Like many Canadians and international observers, I am proud to see the way Canadians rallied to welcome refugees from around the world. The significant bump in Syrian refugees to Canada is not only a credit to the new government, but provides a potential pool of labour for employers in months and years to come.

However, I remain concerned that the increase in refugee numbers has meant a cut in the number of economic immigrants Canada plans to welcome this year. Although the country is targeting up to 305,000 new permanent residents in 2016, the number categorized as economic immigrants is actually down from 2015. About 162,400 spots are guaranteed in this class, down from last year’s 181,000. By contrast, the number of governmentassisted refugees is up 284 per cent from 2015.

There is serious work to do in order to tilt towards a growthoriented immigration strategy, which includes a pathway to Canadian citizenship for temporary foreign workers.

The Canadian Federation of Independent Business’s (CFIB) Introduction to Canada visa proposal is one such idea to replace the temporary foreign workers with a pathway to permanent residency.

Economic immigration has always been the lifeblood of Canada’s economic success and has played a key role in the building of our great nation. While our immigration system has many goals, employers have a priority to ensure that immigrants of all skill levels are able to come to Canada for jobs where they struggle to find Canadians to fill them. I’m confident we can get there.

Dan Kelly is President of the Canadian Federation of Independent Business (CFIB). Follow Dan on Twitter @CFIB and learn more about CFIB at www. cfib.ca.

Established in 1971, CFIB is Canada’s largest association of small- and medium-sized businesses.

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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