Ken,
Thanks for posting this. I must admit to being relieved that my 'gut
insticts' were not far amiss. It is hard to keep up with reality in so
many areas these days.
Paul
From: "Ken Hanly" <[EMAIL PROTECTED]>
To: "pen-l" <[EMAIL PROTECTED]>
Subject: [PEN-L:10715] Structure of Canadian Meat-Packing Industry
Date sent: Tue, 24 Apr 2001 18:53:00 -0500
Send reply to: [EMAIL PROTECTED]
> Here is a short summary from Ag-Canada. It confirms Paul's statement about
> beef-packing concentration in Alberta.
>
> Cheers, Ken Hanly
>
> Structure
> The Canadian meat packing/processing sector consists of red meat products
> and by-products. Beef, pork and processed meats account for 94% of revenues,
> with other meats (lamb, veal, horsemeat and game meats), hides, offals, fats
> and other saleable by-products making up the remaining 6%.
>
> According to Statistics Canada's 1994 Standard Commodity Classification of
> Revenue, beef and pork accounted for 42% and 23% of sales respectively.
> Processed meats represented 29% of sales, with a 60:40 pork:beef ratio.
>
> In 1996, the value of shipments for the red meat sector was $10.1 billion.
> Value-added in the industry was about $2.2 billion. Red meat is the largest
> employer in the food industry, employing more than 33,000 people in 457
> plants in 1995.
>
> Within the context of the Canadian food and beverage processing sector, the
> red meat industry accounted for 19% of total shipments in 1995, down from
> 22% in 1988. Meanwhile, share of establishments (17%), value-added (12%) and
> employment (20%) have remained virtually unchanged. In other words, meat
> establishments in general are larger in terms of sales and more labor
> intensive but provide proportionally less value-added per dollar of sales
> than the "average" food and beverage sector plant.
>
> The meat sector exported 24% of its production in 1996. This is well above
> the Canadian food and beverage sector average of 16%. In 1996, exports of
> $2.45 billion and imports of $1.1 billion resulted in a positive trade
> balance in meat of $1.35 billion.
>
> In 1996, 2.9 million cattle and 14.9 million hogs were slaughtered in
> federally-inspected plants. Although the industry is national in scope, meat
> processing is heavily concentrated regionally. In 1996, 61% of hogs were
> processed in Ontario and Quebec, while the western provinces accounted for
> 36%. Alberta dominated the beef industry in 1996, accounting for 62% of the
> Canadian cattle slaughter, followed by Ontario at 20%.
>
> The market share among small (less than 20 employees), medium (20-200
> employees) and large (200+ employees) establishments changed significantly
> between 1988 and 1994 with the share of large establishments increasing from
> 46% to 60%, while medium and small establishments declined from 49% to 37%
> and 5% to 3%, respectively. The share of very large establishments (more
> than 500 employees) increased from 25% to 40% during the same period. The
> total number of establishments declined from 536 in 1988 to 454 in 1994 and
> 462 in 1996. This decline occurred mainly within the small category which,
> in 1994, represented 50% of total establishments, down from 60% in 1988.
>
> In 1996, about 50 federally-inspected packing plants were engaged in the
> slaughter of hogs, while 25 were primarily involved in beef. In the pork
> sector, the top seven companies (consisting of 12 plants) represented 73% of
> the total Canadian hog slaughter. Five of these plants are located in
> Quebec, three in Ontario, two in Alberta and one each in Manitoba and
> Saskatchewan. On the other hand, the beef sector is much more concentrated,
> with the top four plants accounting for 75% of the total Canadian cattle
> slaughter. Canada's two largest plants, both in Alberta, are American based.
>
> Up to 65% of pork and 25% of beef wholesale cuts are sold by Canadian
> packers to about 380 Canadian meat processors who produce a vast array of
> value-added, cured or cooked products, including bacon, ham, sausages,
> delicatessen specialties and pâtés. Although the majority of these plants
> are small, processed meats provide the industry with the opportunity to add
> significant value and to be innovative in product development and marketing.
>
>
