"We sincerely regret that we cannot proceed with this
investment," Michael McCain, the company's president and CEO said yesterday.
"It is predicated on factors such as cost and changes in the global pork
industry that have significantly impacted the profitability of our fresh meat
business and require us to significantly redefine our strategy."
Costs
Previously, the company announced plans to construct a plant to replace its
existing facility in Saskatoon. However, the plant's costs threatened to exceed
the company's financial requirements.
In addition, the Canadian primary pork industry has been impacted by the
significant strengthening of the Canadian dollar and challenges in the global
pork industry.
Maple Leaf recently completed an analysis of its protein value chain
operations in the context of currency and industry challenges to determine its
best strategy. As a result, the company will undertake a reorganisation to focus
on producing raw material products.
Continuation
The company, employing over 1,700 people in the province of Saskatchewan,
will continue to invest in its operations in the province.
Maple Leaf plans to wind down operations at its existing primary processing
plant in Saskatoon within the next three years. Investments will continue at its
neighbouring McLeod Street plant.
Worldwide, Maple Leaf Foods employs approximately 24,000 people and has had sales
of US $5.4 billion in 2005.
Related website:
• Maple Leaf Foods
