As he enters his second year at the helm of Atlantic Beef Products, Mike Nabuurs remains more convinced than ever the operation can eventually become a profitable enterprise.
The Atlantic area's only federally inspected beef plant is making some inroad into markets both within the region and across the country. The company president admits it has been an uphill battle and "sometimes it is a case of one step forward and two steps back -- it is going to take some time."
However, time may be one thing the plant may soon find in short supply.
The enterprise has faced a continuous series of financial challenges since it opened in 2005 in the community of Albany, P.E.I. Even at full capacity of 500 animals per week, the operation is small scale compared to its counterparts in the west.
Currently, the operation is running at approximately half capacity, and last year experienced losses of close to $3 million. The majority of the animals going through the plant come from P.E.I. and provincial taxpayers have been picking up the tab for much of the losses.
The red ink was twice what the provincial government had budgeted, and a review is underway into what level of support, if any, the province will provide for the fiscal year that begins April 1. The verdict will be announced when the budget is tabled in mid-April.
In the meantime, Nabuurs says it will be business as usual. The plant has recently unveiled a new line of what it's marketing as traditional beef.
"We have gotten some extremely positive feedback," Nabuurs says. "Producers who follow the protocol receive an extra $25 per animal -- we realize that is not a huge premium but if the market grows we hope to be in a position to increase that."
They are also looking at producing a line of pet food.
Part of the reason for the higher than expected losses was an increase in market prices, meaning the plant paid more for its raw product.
The higher prices are something Peter Verleun is certainly not going to apologize for. The president of the P.E.I. Cattle Producers says Island producers have faced a number of financial challenges of their own over the last five years.
"We need that higher return but at the same time we have a vested interest in making sure the plant remains viable," he says.
The plant president couldn't agree more, adding "this can't be an either/or proposition -- obviously we both need to survive and thrive for the industry to have a viable future."
John Jamieson, the executive director of the P.E.I. Federation of Agriculture, maintains the plant makes good economic sense despite the red ink.
"With over 500 full- and part-time beef farmers and 55 full-time employees, the plant generates over $100 million in total economic output to the Island's economy," he says.