Vulnerabilities and Benefits of Megascale Agrifood Processing Facilities in Canada

Seventy per cent of Canada’s beef production capacity is located in just two meat plants in Alberta. This is one of the most obvious examples of the high concentration in Canada’s food-production sector. Industry has naturally tended to larger but fewer facilities, due to the economic imperatives of economies of scale. However, the COVID-19 pandemic has revealed the risks to Canada’s food supply by having so much food production located in so few places. The work done at food-processing facilities entails large numbers of employees, often working shoulder to shoulder. There is a clear potential for a disease to spread quickly, leading to a disruption in food output, or even a complete shutdown of a critical facility. This is what happened during the COVID-19 pandemic. It could easily happen again.

Changing the structure of the Canadian food industry is one option to better insulate the industry against pandemic in the future, creating a greater number of smallerscale facilities scattered in more places across the country. The question is whether Canadians are willing to pay for such changes. That payment could come through taxes, to fund the significant incentives required to entice food producers to move away from the larger and fewer facilities that provide them greater profits through economies of scale, or it could be in the form of higher food prices, as less efficient and more expensive models of production lead to more expensive products.

It may still be possible, however, for Canadians to enjoy a secure supply of the more affordable food provided by the highly concentrated model without having to pay for it, if facilities can be adapted to lower the risk of outbreaks. Mechanization can reduce the dependency on large numbers of workers, while those workers that remain could operate within more stringent safety measures. Safer plant design, more mechanization and fewer workers would, of course, come at some short-term cost, both in terms of the capital outlays required by facility owners and in terms of jobs lost. But in the long term, the result could well be a continued supply of secure, cheap food for Canadians. With that outcome evidently being what Canadians value most of all, the future of Canada’s food supply is likely to be safer but as concentrated as ever.

By Jared Carlberg

Published December 2020.