http://www.canada.com/saskatoonstarphoenix/news/story.html?id=8ee63441-30ba-43e4-9404-4aa03ff6cf3a

Plans for city hog plant move forward

Lana Haight
The StarPhoenix

Friday, November 16, 2007

The Fishing Lake First Nation is leading the charge to build a $100-million hog slaughtering plant in the city.

"We've been working at this for about a year now. And it's not just us," said Jim Ramsay, a consultant with the First Nation.

Fishing Lake, located about 210 kilometres east of Saskatoon, is working with other First Nations in Saskatchewan and Alberta as well as with industry representatives and government to raise enough money to build the facility.

Negotiations with the City of Saskatoon to purchase 65 acres of land in the north industrial area are nearing completion, said Ramsay. He wouldn't disclose the price of the land.

Fishing Lake, Sask Pork, Big Sky Farms Inc. and the provincial government each contributed $125,000 to pay for the development of a business plan. That plan is now complete and the search for business partners with money is on.

Florian Possberg, CEO of Big Sky Farms, said First Nations' involvement is critical to the success of the project.

"First Nations will take the lead role. They have the resources to move this forward and, quite frankly, the hog business is in survival mode," said Possberg.

When Maple Leaf closed its slaughter facility on 11th Street at the end of May, hog producers were forced to ship their animals outside the province.

"It's definitely been a challenge. Some of the markets are all the way into South Dakota and Minnesota with considerable freight costs. Smaller producers are more impacted than others because if you are unable to put together full loads of market-ready animals, those costs are significantly higher yet," said Possberg.

Ramsay believes Fishing Lake and its prospective partners will be able to do what Maple Leaf said it couldn't afford. Maple Leaf had announced it would build a $120-million slaughter facility in Saskatoon to replace the 11th Street plant, but scrapped those plans, opting instead to increase production at its plant in Brandon, Man.

"Our advantage is that we're coming in clean and we're starting fresh. We get to build in production efficiencies that old plants can't have," said Ramsay.

"This is being built to current standards. The plant we're building will be based on robotics. It will be state-of-the-art and European Union licensed."

He estimates 300 to 400 people would work in the plant, slaughtering and cutting one million hogs per year, the same capacity of the former Maple Leaf plant.

"This is a small plant in the scheme of things. This will not compete with the mega-plants in the United States, by any stretch of the imagination," said Ramsay.

"We've picked a couple of niche markets. We are not planning to sell into Canada. We will not be competing in the Canadian stores with Maple Leaf Foods or anybody else."

Ramsay expects construction to begin as early as this spring, with the plant operating within 18 months or by September 2009. Fishing Lake is taking "one step at a time" and will consider an expansion to the facility to process the pork once the first phase is in place.

lhaight@sp.canwest.com
© The StarPhoenix (Saskatoon) 2007