Sure.
The second merger that we examined was between XL Foods and Lakeside. The bureau conducted a comprehensive examination of the matter, interviewing over 50 industry participants in western Canada. As with the previous merger, one of the key issues was the relevant geographic market for the purchase of cattle. As I noted in our review of the Cargill-Better Beef transaction, we concluded that the relevant geographic market for the procurement of cattle was western Canada and certain U.S. northern plains states. Following our investigation of the XL-Lakeside transaction, we had a similar view that U.S. packers located in northwestern and midwestern states represent competitive alternatives for western Canadian cattle producers. Industry participants confirmed that U.S. packers purchased substantial volumes of slaughter cattle and would continue to influence prices paid to Canadian cattle producers post-merger.
One issue we focused on was the ongoing uncertainty about the impact of legislation for mandatory country-of-origin labelling, or MCOOL. We decided that we would need to continue to monitor the industry and reassess the competitive impact of the transaction once there was more clarity surrounding the implementation of MCOOL. In this regard, the bureau remains in regular contact with various officials and industry participants to continue to assess the impact of MCOOL.
At the end of February, we announced that we would not at that time challenge the XL-Lakeside transaction. However, we made it clear to the parties—and to the public—that we would continue to monitor the industry and reassess the competitive impact of the transaction in light of any developments with respect to MCOOL. I can assure the members of this committee that the bureau will not hesitate to take appropriate remedial action should our assessment reveal that a transaction has resulted, or is likely to result, in a substantial lessening of competition.
To conclude, agriculture producers and Canadians in general can be confident that the bureau takes its work in this area very seriously and recognizes the importance of competition as a key driver of growth, productivity, and innovation in the agricultural sector.
Thank you. I'd be happy to take any of your questions.