Blaming a breakdown in its supply chain, a major poultry packer in northern New Brunswick says it plans to lay off about a quarter of its 250 remaining employees.
Nadeau Poultry, which operates the province’s only federally-inspected chicken processing plant, announced the layoffs at the St. Francois-de-Madawaska facility in a release Monday, citing "the New Brunswick government’s failure to regulate the chicken industry."
The province, Nadeau said, has failed to uphold its portion of the national supply management system for chicken by allowing "one single corporation to gain an effective monopoly over New Brunswick-grown chicken."
The corporation to which Nadeau refers is New Brunswick poultry producer Groupe Westco, which in 2008 announced a joint venture with Quebec meat packer Olymel for a $40 million chicken plant at Clair, N.B., near St. Francois.
Birds committed to the two companies’ venture, dubbed "Sunnymel," were then shipped across the provincial border to Olymel’s plants in Quebec for processing.
Westco, Nadeau said Monday, "is now shipping almost 80 per cent of New Brunswick’s chicken supply to Quebec to be processed, for that province’s benefit, leaving Nadeau Poultry, the major employer in the small northern region of St. Francois, without adequate supply."
Nadeau, in response to Westco’s shipments of birds to Quebec, laid off about half its workers at St. Francois, in response to which the previous Liberal provincial government issued a ministerial order in early 2010 designating Nadeau as the only federally-inspected plant for processing of chickens raised within New Brunswick.
That order was later invalidated in court and the Liberals were voted out in September last year.
Meanwhile, "we lost another 22,000 birds per week in August," Nadeau general manager Yves Landry said in Monday’s release. "We decided at that point that we would cut hours across the board instead of laying people off. That is simply no longer viable… If we want to stay afloat, we had to let people go."
As for the timing of the layoffs, he said, "We didn’t want people over-extending at Christmas and then being faced with the bills in January and no job."
The Sunnymel partners in September alleged Nadeau and its owner, Ontario-based Maple Lodge Farms, have "refused all proposals that would have enabled (Nadeau) to continue to process Westco chickens."
Westco and Olymel have said their proposals since 2008 have included an offer to buy the St. Francois plant outright, a "possible partnership agreement for joint operation," a "draft agreement for slaughtering at fair market value" while the Clair plant is built, or "payment of a premium similar to what Nadeau offers elsewhere."
The Sunnymel slaughter and cutting plant, with capacity to kill about 450,000 birds per week, is scheduled to be operational at Clair before the end of 2012.
The Clair construction site last month was hit with what the companies said were several hundreds of thousands of dollars’ worth of damage from unspecified "acts of vandalism."