Olymel - Red Deer (Google)

By The Canadian Press

Cutting about 80 farm jobs

Olymel reducing hog production in Alberta and Saskatchewan; no job cuts at Red Deer plant

May 26, 2023 | 4:19 PM

Olymel says it is cutting about 80 jobs as it reduces its hog production in Western Canada.

However, Casey Smit, Vice-President of Swine Production for Western Canada, says there is no intent to make staffing changes at the Red Deer plant, as job cuts refer strictly to their farms.

The company says it is closing five sow units in Alberta and one sow unit in Saskatchewan in a move that will reduce its western sow herd to 40,000 from 57,000. Smit says affected Alberta farms are mainly in the southern and northern regions, with one near Drumheller.

The company says the closures will result in a net reduction of about 200,000 market hogs annually to its Red Deer slaughter plant from company owned farms.

Smit explained that while less hogs will be sent to Red Deer from Olymel farms, the plant is subject to independent hog supply availability, meaning the procurement team can also obtain animals elsewhere.

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He says the number of hogs slaughtered on a weekly basis into Red Deer already fluctuates regularly and the plant has been able to remain fully staffed at 1,800 employees.

The company says the impact will not be felt until 2024, at the earliest, and the barns will be wound down over the next several months until closing.

Smit says the company is not selling their assets completely but are temporarily closing the barns until market conditions improve, which “will take time”.

He says not only is there an oversupply of pork globally, but the financial situation on the hog production side has taken a large hit.

He says from last year until the present, market returns are far below the cost of production, losing $75-100 of value on the hog return since December. For grain feed and ingredient costs, he explained there has been no relief from the drought two years ago, even with this year’s crop.

“It is a significant situation that we’re in. The whole industry is in it. It’s not going to be good. I think you’re going to hear more farms that are going to say ‘we can’t do this anymore’ because there’s no profitable months left in 2023. All the summer profits have basically evaporated over the last number of weeks,” he said.

“For the volume of animals that we have, we just can’t continue. We’re still going to have losses, we know that, but we just can’t continue to accumulate these massive losses week over week.”

The company says it will work with the affected staff to fill any vacant positions within its western hog operations or find work outside the company.

(With files from rdnewsNOW)