JBS Takes Over Lakeside!

[ASRG]

Now maybe I'm being too much of a cynic here or something, but how long was this JBS deal being cooked up? I doubt it only came into play over the last few days? How long were they talking? Were they talking long before September 3rd?
Was a "crisis" needed to get around a lot of controversy about foreign ownership and packer concentration....lets face it this deal will get a rubber stamp from Ritz and Harper....now!
Was a "crisis" needed to walk away from debts that couldn't be paid? Debts that the Alberta government guaranteed?
Was this a case of taking advantage of a "crisis" or was it a manufactured "crisis"? What role might the CFIA play if this was a manufactured "crisis"? How about Gerry?

We need an independent inquiry into this thing. An inquiry headed up by a judge!

[gcreekrch]

Why? XL is a private company. If any of us had a problem that caused us to sell our properties would it be a public issue?
I too wonder about the whys and hows in this issue but other than govt. involvement this issue is none of anyone's business but the 2 players involved.
Am I happy with the situation and do I think it is a change for the better? No.

Still doesn't make it my business.

[grassfarmer]

JBS won't be buying into this deal to secure the two
US XL plants - they already have huge amounts of
underused kill capacity in the US. Maybe instead
they see an opportunity to break out of the US
market - maybe see an opportunity to market
Canadian beef off the north American continent?
Maybe wishful thinking but I'm a glass half full kind
of person.

[ALLFARMER]

Immediate enhanced access to world markets.

Under what scenario would cattle prices go down
by this????

They would soon find a further shrinking calf
supply.

[GaryE]

I do think there is potential now for the development of Pacific markets...JBS Swift can supply all of the US products it needs and its easier to get to Japan from Vancouver than Brazil...Hats off to Nilssons for getting in another player..good move. They did have oversights in their plant and it's caught up to them and now they've paid the piper...
I can't say the same for CFIA We still need answers for their "non-existance" when independent audits showed discrepancies in the XL plant as early as last May. We need accountability..not more regulations...we need confidence that our food surveilance system works...not more legislation...We need answers soooo.. Sheri, keep asking the questions.

[ASRG]

gc: Nilssons will walk away from their creditors (Alberta government-the fact is they got a $107 M loan-only put out $55 M up front-have they paid back the original XL loan of $24 M...again to AB gov)?
Yea....I think it just might be our business?
As Gary says the CFIA needs to answer a few questions! Nilssons needs to answer some questions! Maybe JBS needs to answer some questions?
Where is Jerry Ritz.....why isn't he asking any questions?

[grassfarmer]

Or you could ask that the other way around Allfarmer

"Immediate enhanced access to world markets.
Under what scenario would cattle prices go UP
by this????"

They say competition doesn't really exist when less
than 4 companies process more than 40% of the
countries beef. So remaining with two processing 90%
isn't going to upwardly influence prices any time
soon.

[ALLFARMER]

Ya I wouldn't say prices are going to go up
anytime soon. I think this whole situation
indicates the plant was at best not very profitable.
I figure this buyout won't equate to lower prices.

If guys with money....Cor Van Raay, the Price
family and now Brian Nilsson can't run a profitable
plant who Domestically speaking could?

[grassfarmer]

JBS are familiar with selling branded hormone and
antibiotic free beef among others. Here are their US
brands.

http://www.jbssa.com/Brands/Beef/default.aspx

[ASRG]

Allfarmer: The Ranchers Choice plant should have been viable? Here's the problem:

The meat packing business is a pretty dirty business. The big boys don't like any competition....and they don't mind losing a few bucks if they can break the small guys! Dry up the supply by bidding a couple of cents more.....sell at a loss to steal the little guys customers....they know they'll make it back in spades once the upstart is gone! This is what XL and Cargill did to Ranchers choice! A classic case of predatory business practices!....and now it is XL's turn to get swallowed up!

There are NO angels in the meat packing business.

In my opinion we need some "competition rules" in Canada if we ever hope to have small to midsize regional packers...very unlikely with the mindset of our present provincial and federal governments....and probably our culture of ruthless capitalism and dog eat dog thinking?
The big get bigger and eat the small. We see it in just about every area? The small Canadian packers are gone, the Canadian machinery companies are gone, our refineries, breweries, flour mills, grain co-ops are all gone....ran out of business by large multi national corporations! Free trade deals have basically let foreign corporations buy our country.
That's just how it is.

[rkaiser]

I think that if you dug a bit deeper on the Ranchers Beef Plant ASRG, you would find that there were a lot more problems than predatory cattle pricing. As with NB and XL.

Buying cattle and packing are two aspects of the business, however, like any other business in the world, marketing is key.

And even marketing was not the only other problem with Ranchers Beef or XL. They were failures that can be learned from.

Should we all simply agree with your "and that's how it is" phrase?

Hell no.

Take a look at the United States for crying out load. The birthplace of modern day predatory business practices and in the shithole economically... Yet there are more value chains operating in the USA relative to their marketplace than Canada.

There are lots of creative ways to both accept the situation, as you say, and never give up and throw in the proverbial towel.

[InAHurry]

Within the walls of Nilsson's Lakeside plant there were a team of people that were negligent in their duties as required by rules/regulations - the law.
This negligence resulted in;
Consumer's turning to another meat product or a serious decrease in beef purchases,
Financial losses due to the recall and then finding future product for the shelves.

This team of people: owners, management, CFIA inspectors/self-regulators and line staff ... payroll lists who should be investigated and held accountable. These results to be held as a model for food processors ... this is what happens when you try to cut corners. Over-simplistic perhaps - I'll admit to being naive.

As for a sale to JBS - I do believe in free-enterprise. It needs to be looked at by the competition board just as other such purchases have to be ... how much faith I have in that being a fair [above the table] process is another story.

Long story short I want to see these people lose their jobs/licenses/certifications and be fined thru due process.

[ASRG]

I'm not saying you can't do it Randy, but so far the success rate isn't all that great in Canada? The US has stronger rules for "competiveness"?

Art and Doug Price didn't know how to market meat??? Sunterra sold into the Asian/Japan market for a lot of years...I think they knew how to move product?