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Manitoba halts cattle levy collection

The voluntary levy with which Manitoba hoped to boost beef cattle slaughter capacity in the province will no longer be collected starting Monday.

The Farm Products Marketing Council announced Friday it will halt collection of the voluntary $2-per-head cattle enhancement levy effective Sept. 1, on recommendation of the Manitoba Cattle Enhancement Council (MCEC), the levy collection and distribution agency whose operations will now be wound down.

Manitoba cattle producers will still be able to request refunds of the levies they paid over the 12 months ending Sept. 1. All livestock auction marts in the province are to be notified “immediately” of the levy’s end, MCEC said Friday.

MCEC has operated since 2006 as manager of a levy-backed investment fund meant to help finance slaughter facilities in Manitoba. The investment pool was funded by the compulsory-but-refundable levy of $2 per head on all cattle produced and sold in the province. The province matched levy contributions to the fund for its first three years.

The council and levy were set up in the wake of the BSE crisis in 2003, when the U.S. shut its borders to Canadian cattle. Manitoba was caught with no federally inspected slaughter facility that could market beef interprovincially or for export — and the province’s producers had relatively little access to federally inspected plants in Ontario and Alberta.

“The directors and staff at MCEC have gone above and beyond in their efforts to build federally inspected cattle capacity in Manitoba,” said Frieda Krpan, a producer at St. Laurent, Man. who in July was named MCEC’s chair, following Barry Todd’s retirement from the post March 1.

“However, we have agreed that it is in the best interest of Manitoba cattle producers to stop collecting the levy.”

Manitoba’s need for federally-inspected beef slaughter facilities “has not diminished over time, but private investment needs to take the lead,” she said in a release.

Provincial Agriculture Minister Ron Kostyshyn said Friday the province still believes Manitoba needs federally-inspected cattle slaughter capacity, but he blamed the federal government’s 2009 withdrawal of $10 million in Slaughter Improvement Program (SIP) backing for a proposed plant in Winnipeg.

Since then, he said Friday, “everyone has done their best to increase federal cattle slaughter capacity in Manitoba. As a cattle producer, I believe it is now time to end the levy before the fall cattle run.”

MCEC went on to help finance the expansion of provincial slaughter facilities as well as the purchase and preparation of the proposed beef project site in Winnipeg’s St. Boniface district.

“MCEC spent $5.7 million developing the (St. Boniface) project based on the commitment that they were going to receive financing through the federal Slaughter Improvement Program,” Kostyshyn said Friday.

Another $1.1 million was spent to pursue “other options” for the project after the SIP funds were pulled.

“Should be ashamed”

Manitoba’s provincial Tory opposition, however, argued Friday that the federal government pulled out because Ottawa did not believe the St. Boniface plan was viable.

Tory ag critic Ralph Eichler said $8 million has been collected from producers through the levy, only for the government to now confirm that plans for a St. Boniface plant have failed.

Kostyshyn “should be ashamed of himself for getting so little return on the investment made by Manitoba’s cattle producers,” Eichler said in a release. “I don’t know how Minister Kostyshyn could look a fellow cattle producer in the eye and say he did his best for them.”

MCEC, Eichler said, also has yet to deliver a $920,000 grant pledged to Carman-area meat packer Plains Processors. That grant got conditional approval from MCEC in 2011.

Manitoba Beef Producers said Friday it approves of the province’s decision to halt the levy and wind down MCEC, noting it has called for such a move through resolutions.

MBP president Trevor Atchison said the producer group “continues to support the expansion of federally-inspected slaughter capacity in Manitoba provided there is a viable business plan.”

Winnipeg lawyer Anders Bruun has been hired as an independent third party to work with MCEC on winding down the organization’s operations, MCEC said Friday. — AGCanada.com Network

Related stories:
Man. beef processor moves on federal upgrade, Jan. 28, 2013
Winnipeg beef packing project to press ahead, Dec. 16, 2011
Feds pick pork over beef for Man. packer funding, July 14, 2011
Man. beef plant up for federal loan, levy funds, Nov. 3, 2009
Man. beef levy to back Natural Prairie plant, Oct. 9, 2007

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