Citing a "weak bacon market," meat packing firm Olymel has decided not to rebuild a bacon production plant that was destroyed in a fire in May in the Centre-du-Quebec region.

Olymel’s bacon facility at Princeville, about 80 km southeast of Trois-Rivieres, was hit by fire May 6 in which the plant’s injecting, smoking and precooked bacon operations "disappeared."

The pressing, bulk slicing and packaging division of the same plant took heavy damage from water and smoke and is now to be demolished, the company said Tuesday.

"Olymel management is aware that this decision will be a disappointment, especially for the employees affected by it," the company said of the bacon plant’s 180 staff, some of whom were temporarily relocated and/or have picked up permanent jobs at other Olymel plants.

The company said it has evaluated market conditions and decided it has "a sufficient number of bacon processing facilities" — its plants at Cornwall, Ont. and Drummondville, Que. — "to meet demand from its customers in Canada and abroad."

The company said it had considered putting up "other types of operation" at the site, but the fire, market conditions and demand for the plant’s product had "forced Olymel to review the distribution of its operations in the pork processing sector in the coming months" for efficiency and profitability.

"Results for this sector have been in decline for several years," Olymel CEO Rejean Nadeau said, noting lower sales volumes, the "reduced availability of bellies" due to declining hog production, "fierce competition" in the fresh and precooked bacon sectors from lower-cost U.S. manufacturers and the strength of the Canadian dollar.

"The situation in the bacon sector has been under close watch for several years, and various remedial measures have been implemented in order to improve results," he said, noting the company had "invested heavily" at Drummondville and Cornwall, "modernizing procedures at these facilities by installing cutting-edge equipment."

"Hiring priority"

Olymel in May had set up a voluntary temporary relocation program for the Princeville bacon plant’s staff, in which employees who so wished were relocated to several other Olymel facilities located within a 100 km radius until this month.

With that program "now coming to an end," a number of employees who took part have since been offered permanent jobs as positions became available at the host plants, particularly the Drummondville bacon plant, Olymel said.

Past that, Olymel said it will now set up a "centralized job database from which it will be able to offer permanent employment to each Princeville employee requesting it," giving "hiring priority" to staff who were laid off due to the fire.

That database already includes 162 available positions at nine other Olymel facilities in the province, the company said, noting it will now also extend its program covering the costs of transportation from Princeville to other nearby plants until Dec. 31.

The company also stressed that it "will continue to contribute to the economic development of the region" through its other Princeville facility, a primary hog slaughter and cutting plant in the community’s downtown.

The cause of the bacon plant fire is still under investigation, company spokesman Richard Vigneault said Wednesday, though he noted experts have said it will be "very tough to find a cause" for the blaze.

Related story:
Destroyed bacon plant’s fate uncertain, staff to relocate, May 14, 2012