Maritime beef producers are hoping a new board of directors will help turn things around at the Atlantic Beef Products plant in Borden-Carleton, P.E.I.
It is the region's only federally inspected beef plant. It opened with the participation of the three Maritime provincial governments and beef farmers in the region in 2003. Since then it has lost $30 million, $600,000 of that in the last four months.
The financial picture for the plant has been up and down — it even broke even for a brief period at the end of last year — but officials with the P.E.I. government say the new board could be the plant's last chance.
"I would say if we can't make this successful, with the level of expertise we have around that board table now, it may be the last kick," Brian Douglas, P.E.I.'s deputy minister of agriculture, told CBC News on Thursday.
Douglas described the new board as a group of successful Maritime business people. It includes Jim Casey, who is a member of the P.E.I. Business Hall of Fame for his success in building the Paderno cookware company.
Farmers lose faith
Casey and his fellow board members face the task of not only bringing the plant into the black, but doing it in the face of cattle producers who are losing faith in the company.
Some of them have been sending their steers to Ontario for processing because they have been waiting too long to get paid on P.E.I.
Casey said the company is being restructured, and a long-awaited $6-million injection from the Atlantic Canada Opportunities Agency is expected in the next few weeks. That money was promised in December 2007, but has been tied up in arguments about whether it would be a grant or a loan. Casey said it has not been agreed the money would be repayable only if the plant starts making a profit.
Some of that money will go to installing a hamburger processing line in an effort to to boost sales.
"It's a tough business, and there's so many risk factors that you don't have control of. You can get yourself in trouble pretty fast," Casey said.
"On the other hand, it can turn around fairly fast. If you get everything working right and do the best you can, we should be able to make it work."
Casey said once the new arrangements are complete, beef producers will get paid more quickly.
A new board of directors was not government's first choice. Douglas said officials scoured North America to find someone to either buy or partner in the plant, but there was no interest.
Government officials expect to see a two-year business plan from the new board sometime soon.