Manitoba hog producer Hytek Ltd. has opted to buy rather than build new to get into the pork packing business.
The company, based at La Broquerie in southeastern Manitoba, announced late Thursday that it will buy the Springhill Farms pork plant at Neepawa, about 50 miles northeast of Brandon, for an undisclosed sum.
The deal spells the end of Hytek’s plans for a $200 million kill-and-cut hog plant in the industrial end of the St. Boniface district of Winnipeg. That proposal, when announced in 2005, came with support and co-operation from city hall and the provincial government, but was opposed by residents and area businesses.
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Hytek’s partners in the proposed OlyWest plant, Quebec packer Olymel and Saskatchewan hog producer Big Sky Farms, later backed out, leaving the Manitoba company pledging to find other investors and continue the approval process for the St. Boniface site.
Hytek vice-president Guy Baudry said Friday in the Winnipeg Free Press that the company would spend $35 million to step up the plant’s kill rate to its rated capacity of 4,000 hogs per day, as well as the plant’s capacity to add value by producing new specialized cuts.
The company said in a release that these improvements would “not only secure the long-term future of the existing 350 jobs but also create an additional 200 new jobs” at what’s already the biggest employer in the Neepawa area.
“We are very excited that Hytek has agreed to purchase our Neepawa-based food processing facility and that they intend to take the plant to the next level,” said Springhill co-founder Mack Wollmann in the release.
Springhill was founded in 1986 by the Hutterite Brethren. The plant shut down indefinitely in 2003, citing hard economic times in the pork industry, but re-opened later that year following a $3 million provincial loan.
Hytek bills itself as the largest privately owned pork producer in Canada, with production and marketing operations across Canada and the U.S. as well as production and processing investments in China.
Baudry told the Free Press that while the company felt its St. Boniface site was one of the best for a food processing plant in Western Canada, the Neepawa sale is “the best option we could secure within Manitoba.”
“Unfortunately we have lost the opportunity to have an additional processing plant, but we are pleased to see that Hytek is continuing to invest in Manitoba,” said hog farmer Karl Kynoch, who chairs the Manitoba Pork Council, in a release.
Now that OlyWest is off the table, there continues to be a “critical” shortage of processing capacity in the province, the council said.
More coverage of Hytek’s deal will be available in the Oct. 18 print edition of the Manitoba Co-operator.
