Thank you, Mr. Chair.
Good morning, members of the Standing Committee on Agriculture and Agri-Food.
To begin, I would like to say a few words about Olymel. Olymel is the largest meat processor in the country. We operate in the pork and poultry sector. Our facilities are located in five Canadian provinces: New Brunswick, Quebec, Ontario, Alberta and Saskatchewan, where we operate farms. As a major pork producer and processor, we are an important economic player not only in Quebec, but in Canada.
As was mentioned a few moments ago, our market is not only in Canada, but also around the world. On the other hand, Olymel occupies a relatively smaller place on the world stage. We have to deal with international players with a presence on several continents and whose activities are much broader in scope than ours. We consider our $4.5 billion in sales to be modest compared to those of internationally owned and capitalized companies.
I mentioned our two business segments, which are fresh pork and processed pork, and fresh poultry and processed poultry. The last three sectors have performed exceptionally well, which has allowed the company to face the situation we have been going through over the last few years. Our most unprofitable sector was fresh pork. As mentioned at our last annual meeting, the company has lost more than $400 million over the past two years. Essentially, these losses are related to our international operations.
We had to make a choice: redesign our business model or die with it. We decided to review our business model in order to support the industry, both in Quebec and in Canada. Our business volume is smaller and more modest, but we are at least ensuring sustainability. Moreover, the outlook is more encouraging than seeing the main meat processor exposed to the turbulence of the international market.
As mentioned earlier, the international market has been disrupted by the labour shortage, but less so than Canada. The labour shortage, of course, coupled with the loss of our ability to export to the Chinese market, obviously amplified our losses. This made it impossible for us to offer value-added products to meet the demands of Canadians.
Essentially, for too many months, we were slaughtering animals to prevent them from going to humane slaughter. This allowed us to keep basic, non-value-added cuts. It was this problem in particular that led us to decide to review our business plan.
According to this business plan, if we wanted to continue to slaughter the same number of animals, we had to close one of our facilities. We thought long and hard about it and analyzed all the factors: the availability of labour in each region; the ability to use employment agencies, and the estimated investment needed to keep the facility operating and to meet both environmental and public requirements.
In the end, we realized that the Vallée-Jonction facility was the most difficult to maintain. There was no doubt that the closure of this facility located in an important production region of Quebec would have an impact. It was obvious, but we had to close a facility in one of the four regions of Quebec where we operated slaughterhouses.
I want to reassure the members of the committee that the comprehensive analysis was conducted seriously and without preconceived ideas by the most senior executives of the organization. We wanted to make sure that we were making the best possible decision for the organization and for the industry.
In fact, the announcement of the closure and the choice of facility was made not because we were in negotiations with the hog farmers in Quebec for a new marketing agreement, but because it allowed us to make our decisions based on what was going to happen during marketing. Working with the hog producers, we found a way to reduce or at least try to reduce the impact on production and producers in the Vallée-Jonction area. I know that there is a representative from that riding who is involved in the work. We will have the opportunity to discuss more specific issues with him.
We will work with the government to try to relocate as many workers as possible, whether they are temporary foreign workers or workers who live here and are part of our communities. However, it should be noted that Olymel expects to receive another 1,200 temporary foreign workers.
Despite the efforts of the Quebec and Canadian governments, there is an extremely large labour shortage, which we hope will be reduced in the coming years. We have the capacity to take on new employees in our other facilities, without penalizing any Quebec workers already employed by Olymel.