040310 Canadian Processors Testify at Beef Price Probe

Edmonton, Alberta, Canada - Canada's three largest meat packing plants will be forced to testify before a parliamentary committee Wednesday, a highlight of what is bound to be an explosive week of questions on whether the plants reaped unfair profits from the mad cow crisis.

Politicians across Canada this week demanded firm answers on why cattle prices have plummeted in recent months, while many beef prices have stayed relatively the same.

"I hope we'll come and hear them make contrite apologies and they'll stop what's been going on for the last many months," said David Kilgour, Liberal MP for Edmonton-Southeast.

Kilgour has spearheaded a push to summon Cargill, Lakeside and XL Foods -- Prairie slaughterhouses which handle nearly three-quarters of Canada's beef -- before the standing committee on agriculture.

The orders to appear follow the companies' refusal to attend a committee hearing two weeks ago, leaving umbrella groups and smaller packers to plead their case. Kilgour then put forward a motion exercising the committee's power to compel witnesses.

Lakeside and Cargill, both U.S.-owned companies with massive plants in southern Alberta, together control about 65 per cent of the kill capacity in Canada. XL Foods is a smaller, Calgary-based firm which owns Saskatchewan's largest slaughterhouse.

The Alberta government will also release its own study next week to address accusations of "price-gouging" plants, but critics say the study will not probe deeply enough.

Amid widespread calls, the packing industry has defended itself by saying plants have incurred many new costs since the mad cow crisis began last May, such as disposal of cattle parts they used to sell to Asian markets before they banned Canadian beef.

However, they have refused to open their books and explain their added costs, citing competitive secrecy.

Lakeside spokesman Gary Mickelson said the company was only invited to the February committee meeting a week beforehand, not enough time to send somebody. Cargill spokesman Rob Meijer said his firm preferred to send the Canadian Meat Council to speak on behalf of all packers. Now, Cargill will send its Canadian business manager to testify. "Obviously, we had no intent to get it that far" as to merit a summons, Meijer said.

Garnet Altwasser, Lakeside's plant president, will be that firm's witness.

The agriculture committee has asked the federal competition bureau to investigate. The bureau this week called on Canadians to send in their concerns or protests on beef prices, which might trigger a full probe.

Saskatchewan's agriculture minister demanded Ottawa launch a public inquiry into beef prices. The P.E.I. agriculture committee on Thursday threw questions at retail and packing representatives. In Alberta, the New Democrats this week demanded a public inquiry, after data they said shows the packers are turning a 200-per-cent profit and soaking up government bailout funds designed for ranchers.

The Klein government turned down that call, but has already launched its own small probe of the situation. Part of the so-called "carcass evaluation" study will compare the costs of various beef cuts before and after the BSE crisis, department spokeswoman Terry Willock said.

Source: The Edmonton Journal

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