WINNIPEG, Manitoba – The Canadian government's decision to cancel a $10 million federal loan commitment for a federally inspected beef processing plant in Manitoba greatly disappointed the Manitoba Cattle Enhancement Council (MCEC).

The federal government announced its contribution to open new markets for Manitoba beef by conditionally approving a loan of up to $10 million to convert a former pork plant in Winnipeg in November 2009. At that time, the announcement was considered a victory for Manitoba cattle producers since the facility would address the gap in federally inspected slaughter capacity on the prairies, which is so badly needed as shown during the 2003 BSE crisis. MCEC said.

"Manitoba beef producers need this plant," said Kate Butler, MCEC executive director. "We met every condition, bringing in a world-renowned management team to put together a viable niche model plan based on their successful experience. We worked out an $18.2 million loan package from a major private bank. We kept this project on track despite demanding federal timelines. To get this news now, despite all the work done in good faith, is a shock."

Regardless of this setback, MCEC said it remains committed to its mandate to bring export-oriented, federally inspected beef plant capacity back to Manitoba.

"Producer benefit and a competitive advantage are key elements that must be present in any of the projects we support,” Butler said. “We want our investments to be around for the long haul. While this decision is clearly bad news, we have been emboldened by the level of private interest in this project and we know how badly it's needed. We are committed to the producers and people involved and are determined to make this plant a reality.

“We intend to pursue other private financing options and move forward for the future prosperity of Manitoba's beef producers," she added.

From the original purchase of the former Maple Leaf plant in July 2008 and the creation and operation of Keystone Processors Ltd. in December of 2008, to the hiring of an international management team in October 2010, MCEC said it has continued efforts to address the deficit in slaughter and processing capacity in the province. The corporate reorganization in 2010 put MCEC as the majority interest in the plant for its investment to ensure producer benefit was part of the business plan.