Rancers Meats moving forward

By Amanda Arnold
Staff writer

Sixteen months, dozens of meetings and thousands of kilometres later, what began as an idea being kicked around over coffee finally became a reality last week.
The group behind Ranchers Meats Inc. officially announced the construction of a $40-million slaughter facility on Aug. 26.
“This is a great day for Ranchers Meats,” said Stan Schellenberger, company president, during a press conference at Winterburn Hall.
“It’s a sunny day, and a sunny day for our project.”
Construction of the packing plant, which will be able to process 800 head per day and is located in the Acheson Industrial Area, is set to begin in early September, with an anticipated opening in August 2006.

Background
The catalyst for the project was the spring of 2003, when Canada’s first case of mad cow disease was discovered on a farm in northern Alberta, resulting in the closure of the U.S. border to Canadian cattle.
“Everyone thought that this was a short-term thing,” said Schellenberger, who farms north of Spruce Grove.
“We lost just about a year and it became evident that this was longer-term and we had to become more self-reliant than dependent.”
So, in the spring of 2004, Schellenberger and a small group of ranchers who had been getting returns on their cattle “that were pathetic,” kicked around the idea of forming a new generation co-operative with the intention of selling enough shares to finance a packing facility in the Edmonton area.
But for that to work, the group had to hit the road, holding meetings in communities as far south as Milk River and as far north as Peace River, trying to convince farmers to buy $5,000 shares in the newly formed Ranchers Own Meat Processors Inc.
The co-operative’s initial goal was to sell 3,000 membership shares and 1,000 investment shares to finance the facility. But by September 2004, the co-operative only had around 500 investors, causing organizers to re-evaluate their approach.
In order to speed things up, the decision was made to separate the packing plant into its own corporation, Ranchers Meats Inc., and have the co-operative as a key investor, while enabling other investors to come on board.
The slaughter plant’s investors now include Ranchers Own, Border Beef, which is a group of eastern Alberta and western Saskatchewan farmers, a group of approximately 20 ranchers who each kicked in about $500,000, and a handful of investors who contributed in the $1-2 million range. There are also plans to have a second share offering in the co-operative, likely towards the end of September.
The funding enabled the group to look for debenture capital to fund the construction of the plant. And once that was secured, it was full steam ahead.

Progress
At the press conference, Schellenberger said the facility is a long-term solution for Alberta ranchers.
“We have secured what we believe is the best spot in Northern Alberta for this plant,” said Schellenberger, as it’s near major highways and regional water and sewer lines.
It’s also in the centre of the largest concentration of cows in Canada.
“We are a huge producer of beef, right in our own country,” he said.
And although the U.S. border has reopened to young Canadian beef, Schellenberger said the situation cattle growers find themselves in has changed. The Canadian dollar is worth more now and fuel prices are through the roof.
“The only way these cows are going to the U.S. is at a lower price.”
Looking back, he did admit there were times he didn’t think the plant was going to become a reality.
“There were days when we stepped backwards and thought we weren’t going to make it,” he said. But just at the right moment, he would get a call from a group of farmers wanting shares, giving the key players the momentum to keep moving forward.
He thanked farmers for their faith in the project and their financial support.
“Money was very difficult for a lot of farmers,” he said, but the project still managed to draw 1,000 shareholders.
“We will be the source to bring additional business to this area.”

Kudos
Provincial Agriculture Minister Doug Horner, who is also the MLA for the area, was on hand at the press conference to offer his congratulations. 
“This is an extremely important day in Alberta’s cattle industry,” said Horner, who praised the group for doing its homework
“Anyone can build a plant,” he said. “It’s what you do afterwards that’s important.”
Parkland County officials said they were proud to have the plant within the county’s borders.
“It’s an extreme honour and pleasure to have it in Parkland County,” said Coun. Clifford Goerz, adding he wouldn’t be surprised to see more agricultural industry come to the area because of the packing plant.
“For the industry, it’s a must,” Goerz said. “It’s value-added right here. We’re not shipping the product out.”
“Parkland County is really proud to be a part of sustainable agriculture,” added Mayor Phyllis Kobasiuk.
Albert Wagner, a director and shareholder with Ranchers Own who runs a mixed farming operation in the tri-municipal region, said he felt it was an obligation to participate.
“How do you bring value to something?” he asked, adding that when the first case of mad cow disease was discovered in Alberta, the price of cows went from 40 to 50 cents per pound to 15 cents per pound.
“It was very clear that we had to do something.”
He said the plant construction creates optimism in an often beleaguered industry.
“It creates a new energy and the feeling that we are moving forward.”