6. Flagship Initiative Development:

AGRIBUSINESS

To review the Agribusiness Industry Final Report in its entirety please visit our website at www.actionsouthwest.com.

1. Increase Value-Added Agriculture

Challenge

Land throughout the region is used to grow crops and raise livestock. Increasing production is a leading focus in agribusiness. Provincial and federal government programs promote increasing production and farm size building on economies of scale. Canada is recognized for quality and volume of crop production yet Canadian farmers lack the capacity to compete in a subsidized global marketplace. Dependence on United States for markets, market development, and value-added processing continue to place agribusiness in Southwest Saskatchewan at risk (i.e. beef, hogs, grain, softwood lumber).

Solution

Increasing value-added in the region has been identified as top priority to build on the existing assets of the region creating local markets for a portion of crops, forage and livestock. Moving beyond primary production by supporting the development of existing and new value-added projects will create jobs and business opportunities here mitigating the risks of primary production while diversifying the economy of the region. For example, Red Coat Cattle Feeders is a 10,000 head feedlot located near Hazenmore. It provides: markets for local barley; a feedlot for cattle raised in the area or purchased to be fed in the region; a market for forage and straw; jobs for feedlot workers; contract work for trucking firms trucking cattle and supplies; fuel sales at the local bulk dealer; contract work for corral cleaners and silage companies at the facility. This in turn means more meals sold at the local restaurant, more work for the local veterinarian, etc.

“Building on our natural assets and adding value here in the region are some key things to build success in the business of agriculture for the future.”
Karen Bonesky, BNA
Agribusiness Leadership Team

The following is a list of projects the Leadership Team felt should be supported or advanced:

Southwest Saskatchewan has a large cowherd. Most of the calves from these cows are not fed in the region. Traditionally the calves, barley and jobs have benefited the neighboring province.

Participants identified the need to expand feedlot capacity by an additional 70,000 head. The region has existing feedlot projects waiting to be developed that will benefit from this initiative.

The Cypress AgriEnergy project, to be located in Shaunavon, is in the developmental phase. Continuing to advance, this project will create jobs by adding value to grain produced in the region and beyond by manufacturing ethanol in the southwest.

The Southwest Beef Initiative Committee is working to establish a beef packing/processing plant near Swift Current. Working in partnership with First Nations, this project will build on the assets of the region, create capacity for additional feedlots and create jobs in the region.

The Leadership Team also identified the exploration of bio-diesel development and the development of a regional food processing facility to be shared by all processors in the region as some possible new opportunities that could benefit the region:

General Approach

With the understanding that a number of initiatives are underway in the region this initiative will respect and support existing projects as required while promoting the importance of value-added development in the region. As the packing plant moves forward additional feedlots will be required in the region. A shared regional business plan and template may be developed and made available for use by all regional feedlot projects saving cost and time.

Action Plan

1. Develop a project committee.
2. Support value-added initiatives underway in the region encouraging the development of supply networks.
3. Continue to build regional capacity for new value-added initiatives.
4. Promote the importance of value-added development and resulting economic spin-offs.
5. Research bio-diesel opportunities for value-added agriculture when human resources and funding are available.
6. Work in partnership with a university class project or engage a research class to assist
   with the project.

Regional food processing facility project

1. Engage project committee consisting of two volunteers and SAFRR Business Development Specialist
2. 2. Invite additional participants
3. Do a preliminary regional industry assessment to determine:
   • Inventory existing food processors in the region
   • Assess needs of regional food processors
   • Identify new and emerging food processors in the region
   • Identify possible locations for the project Identify possible existing facilities
   • Existing and future demand
4. Based on assessment the committee will move to feasibility study and business plan when human and financial resources are available.
5. Encourage the development of a regional food processors network that provides access to appropriate training, workshops and mentorship.

Possible Sources of Leadership: Volunteers from the Agribusiness Leadership Team, Saskatchewan Agriculture Food Rural Revitalization, Saskatchewan Rural Development, Saskatchewan Association of Rural Municipalities, stakeholders from existing value-added projects, Cypress Hill and Southwest Regional Economic Development Authorities, Southwest Community Futures Development Corporation, banks and credit unions, accountants, South West Centre for Entrepreneurial Development, Cypress Hills Regional College.

2. Diversification Beyond Agriculture

Challenge

Farmers and ranchers in agribusiness focus on the work within the business and take what already exists in their sector for granted. An undeveloped opportunity in the region is an agritourism strategy. This type of strategy would require programs that provide strategic planning, human resources for project development, regional capacity building together with a regional brand and marketing strategy. Existing funding programs create barriers between agriculture and tourism rather than recognizing their synergies in value-added development.

Solution

Diversification beyond agriculture is about building businesses using the natural assets of the region, the diversity of the land and landscape, and the people in agribusiness. Taking what they already do and creating a market that attracts buyers and visitors to the region. Existing tourism attractions will have more to offer the visitor by offering packages that enhance visitor experiences in the region. Integrating and networking with existing organizations and attractions will create and expand a framework of experiences that will create new business opportunities, bringing more visitors to the region, and expanding the revenue generated in agribusiness in the future.

This initiative will link the sectors of agribusiness and tourism building on the framework that exists and developing it to create new regional opportunities through ecotourism, agritourism, education, and cultural and historical tourism.

Diversification beyond agriculture will also present opportunities for locals and visitors to learn about agribusiness in an interactive, experiential format. Experiences unique to the region and its culture will be incorporated into visits to orchards, farms, ranches, grain terminals, pulse plants, organic farms, parks, and regional attractions to name a few.

General Approach

Two Agribusiness Leadership Team volunteers are committed to advancing this project in a leadership role. Cross-sector discussions with tourism at a small committee level will determine commitment. The busy season begins in April for both sectors, as a result limited leadership time commitment will be available until after the end of October. Groundwork for this project needs to be completed prior to the end of October, with implementation during the winter and early spring for a regional launch in the 2006 season.

Action Plan

1. Facilitate a committee meeting with volunteers of both sectors to determine terms of reference to advance the project.
2. Establish a leadership team to provide leadership, assist with networking and path finding.
3. Seek funding to advance Phase One of the project, which would address feasibility, regional capacity building, and development of a regional strategy and governance model to create the framework for diversifying beyond agriculture.
4. Contract human resources to deliver Phase One under the direction of the leadership team to be completed by October 15, 2005.
5. Based on the results of Phase One the leadership team will develop a strategy for Phase Two which will include development of a marketing strategy, marketing materials for participants, training as required, recruitment of additional participants in preparation for 2006 season. A business plan will be developed. The project will require continued financial support for co-ordination, marketing, networking and development of materials.
6. Phase Three will be rollout and launch in 2006 as per the business plan with human
   resources in place to advance the project, track the results and make recommendations for the following year.

Possible Sources of Leadership: Ag industry leaders, Saskatchewan Rural Development, Saskatchewan Agriculture, Food and Rural Revitalization, South West Centre for Entrepreneurial Development, Southwest and Cypress Hills Regional Economic Development Authority, Southwest Community Futures Development Corporation, and regional tourism organizations.

3. Partner Up to Brand the Region

Challenge

Agricultural value-added products produced in the region are part of the global marketplace.
Without a regional brand that is easily identified as an umbrella for new products to be introduced to the marketplace, each new item introduced to the marketplace faces large costs with limited success. Entrepreneurs identify limited access to financial resources for marketing and limited knowledge of expertise to direct development of materials as challenges in business development. Access to retail shelf space often requires a minimum number of products offered for sale. As a result entrepreneurs with one or two value-added products have difficulty entering the market.

As stated by a member of the team, “we take what exists here for granted and expect that others should know without making information available”. We need to identify reasons for lack of awareness and understand of the diversity of agriculture within the region and beyond.

Solution

This initiative will: Create a regional brand that provides a framework and materials with the
capacity to develop sales for value-added products of the region.

Partnering up to brand the region assists with

• Marketing the products of the region in the global marketplace
• Creating local awareness of the region and its attractions
• Creating global awareness of the region, its products and attractions
• Investment attraction

General Approach

Engage representation from across the region to develop framework for the project through a branding seminar. Seek regional partners that benefit from the project. Build the terms of reference for the project. Seek funding and recruit expertise to deliver the project in consultation with SAFRR, STEP, International Trade Canada.

Action Plan

1. Build the project team
2. Identify target markets
3. Develop a strategic plan, cost the project and develop the business plan
4. Secure required project funding
5. Contract required expertise
6. Create and cost the marketing strategy
7. Involve the entire region in the brand launch; engage schools, seniors, and municipal governments in activities that create awareness.
8. Market development work with value-added businesses (web, print, labels, tradeshow booths, etc)
9. Work with the province to showcase the regional brand and the regions products
10. Work with STEP and International Trade Canada, Agriculture Canada and SAFRR to build capacity to participate in regional, provincial, national and global trade and marketing events.
11. Build regional capacity by encouraging research and development of new value-added products.
12. Host an annual tradeshow/conference featuring the regional brand and products with workshops and seminars that build greater capacity within businesses and the region.
13. Create a governance model that ensures brand standards, product development, training, and hosting trade missions/events in the region.
14. Develop a mentorship program linking new value-added businesses with established, experienced mentors. Encourage a global mentorship model building on the support of federal and provincial government organizations and services.

Possible Sources of Leadership: Volunteers from the Agribusiness Leadership Team, Action Swift Current Branding Committee, Value-added business representatives, Saskatchewan Agriculture, Food and Rural Revitalization, Saskatchewan Rural Development, South West Centre for Entrepreneurial Development, Cypress Hills and Southwest Regional Economic Development Authority, Southwest Community Futures Development Corporation.

4. Linking Agriculture / Tourism / Kyoto / Education

Challenge

The challenge is finding ways to utilize the natural assets of the region, the crops, forages, grasslands/native prairie and the farmers/ranchers as stewards of the land in a way that brings financial gain to the region. Small communities with minimal environmental pollution give the southwest an image of being green, wholesome and healthy.

Solution

This initiative has the potential to add value beyond primary agriculture using research, training and technology. Research is required to determine how regional agricultural assets can be utilized to generate revenue beyond primary production. What unique learning or research we can develop or deliver in partnership with universities or colleges that brings people from around the world to our region? How do our assets factor into Kyoto protocols? Is there are revenue source for the region in Kyoto?

General Approach

Liase with federal and provincial governments, universities, research facilities, municipal governments, SARM and others to identify potential opportunities for the region. Determine an action plan based on the outcomes of discussions.

Action Plan

To be determined.

Possible Sources of Leadership: Saskatchewan Rural Development, Saskatchewan Association of Rural Municipalities, Saskatchewan Agriculture, Food and Rural Revitalization, and volunteers from the Agribusiness Leadership Team.

5. Find and Develop Markets in the Global Marketplace

Challenge

Markets are key in business development in any sector. In the agribusiness sector market development has been a function of service providers, production has been the role of the farmer or rancher. As agriculture moves to value-added and beyond market development is critical.Farmers and ranchers lack the expertise, time, and financial resources to develop markets individually in effective ways. Existing strategies for market development demonstrate limited success.

For example, twenty two months after the first BSE situation and the border closing, the approach for beef market development continues to be waiting until the U.S. border opens, instead of identifying the needs of the client, putting systems in place to ensure market development and building new markets.

Solution

Efforts in understanding the global marketplace and finding opportunities for the agribusiness sector requires financial commitment by governments and agribusiness. Markets and continued market development are essential for sustainable growth in the agribusiness sector. Clear and concise regulations and ease of working together with industry, governments and Canadian Food Inspection Agency are required to participate in the global economy. Timeliness in process must be in place for ease of entry into the global marketplace. This project requires commitment and action by all levels of government and agribusiness.

General Approach

This is a five-year project. Proponents will use a collaborative approach working together with agribusiness and governments to identify existing and potential market opportunities value-added and other agricultural products. A governance structure that meets the needs of the project will be developed. The project will require a minimum of annual evaluation with appropriate adjustments to accomplish established outcomes.

Action Plan

1. Engage proponents.
2. Identify existing and potential market opportunities.
3. Develop governance structure.
4. Develop a regional strategy to find and develop new markets.
5. Set targets and allocate resources.
6. Develop the business plan.
7. Using materials developed engage appropriate resources to deliver targets.
8. Evaluate results annually making recommendations.
9. Implement recommendations, adjust the plan, and move forward to subsequent year.
10. Annually engage regional businesses through seminars or conferences to advance new opportunities identified and adjustments required to compete in the global marketplace.
11. Support development of new products and opportunities through business and government working collaboratively.

Possible Sources of leadership: Saskatchewan Rural Development, Value-added business leaders, South West Centre for Entrepreneurial Development, Saskatchewan Agriculture, Food and Rural Revitalization, Canadian Food Inspection Agency, Saskatchewan Association of Rural Municipalities, Southwest Municipal Government Association, Cypress Hill and Southwest Regional Economic Development Authorities, and Southwest Community Futures Development Corporation.

6. Address Regional Labour Shortage

Challenge

The Agribusiness Sector identified a seasonal and year round labour market shortage, common in a number of sectors across the region. Declining rural populations, continued growth of the energy sector, increasing construction jobs in the City of Swift Current and continued outmigration to Alberta combined with an aging farming population are some of the factors that influence the labour market shortage in the agribusiness sector. Increases in regional valueadded agribusiness will place additional pressure on the labour market.

Solution

Find ways to work collaboratively with the Labour Attraction and Retention Committee (LARC) in Swift Current or refer this initiative to the LARC committee for their project.

General Approach

Use a collaborative approach working together with other existing projects in the region to avoid duplication. LARC has leadership in place and is working toward developing a strategy for the project.

Action Plan

Refer this initiative to LARC leadership committee for discussion.

Suggestions for actions in this initiative included creating incentives that create attachment to smaller communities in the region through bursaries, tax incentives or forgiving a portion of student loans over time. A condition of the bursary or incentive would be that young workers would commit to employment in the designated community in the region for a specified period of time. This would assist in recruiting and retaining young workers to smaller communities in the region.

Possible Sources of Leadership: Cypress Hills Regional College, Southwest Chambers of Commerce in the region, CanSask Career and Employment Services.

7. Work Together with Governments to Address Issues and Develop a Stronger Agribusiness Sector in Saskatchewan

Challenge

The following is a list of issues discussed by the Leadership Team:

• Projects need risk capital access prior to offering memorandum.
• Volunteers are tapped out--time and energy are spent running businesses, farms, and declining communities in order to maintain existing infrastructure, no time or energy left for economic development.
• Government process to get to the right people and obtain permits is more time consuming and complicated than necessary. (i.e. Pine Cree feedlot project).
• Government guidelines are followed but government red tape and response time are too slow (i.e. railroad project and government investment).
• Lay people and business owners who volunteer on community development projects find government process, volume of paper and time to assemble, follow-up, wait, check, follow-up is unreasonable.
• Government promotes business growth in Saskatchewan but their actions sometimes contradict the publicized message.

Solution

Work with government to find meaningful ways to engage the expertise of community leaders and volunteers respecting their business and family commitments. We need to create programs that provide financial resources for paid project support, timely government response times, and develop streamlined processes for projects that are user friendly.

General Approach

Recruit an experienced solutions focused project committee that compiles the issues and takes them forward to government together with recommended solutions. Collaborate with
government regarding the issues and solutions engaging departments, ministers and the region as appropriate.

Action Plan

1. Recruit the committee
2. Committee selects leadership
3. Outline goals and objectives
4. Develop strategy
5. Compile issues and solutions
6. Implement strategy as developed

Possible Sources of Leadership: Leadership or project managers of regional economic development initiatives.

8. Work with Governments to Create Certainty in Agribusiness

Challenge

Agribusiness, the business of farming and ranching is more than production. It is about developing sustainable enterprises. Products and services, finance, marketing, human resources and capital assets are all important in the business. Planning and farm management skills are critical tools for the farmer and rancher.

Strategic planning, goal setting and implementation can be accomplished with some success when there is a degree of certainty in the sector. To quote a Leadership Team member, “In Agribusiness the only certainty is chaos”. For example, participants indicated that individuals who may lack understanding of the industry and hands on implementation required influence and design farm programs in what seems to be an ad hoc basis. Crop insurance programs change each year with incomplete information available when farmers are making seeding plans. Livestock programs developed in response to BSE put millions of dollars into the hands of packers, who were already reaping huge benefits from the impact of BSE while the farmer and rancher received little benefit. Loan programs developed in 2003 in response to BSE had payments due in 2004-5 when the border issue had not been resolved and insufficient packing was still a roadblock in this province.

Solution

Find an effective way to liaise with federal and provincial governments about the business of sustainable agriculture in the southwest and provide input when programs are developed or evaluated. Continue to facilitate leadership development-training opportunities for farmers and ranchers to gain expertise that will enhance the development of sustainable enterprises.

General Approach

The leadership team will develop terms of reference and engage a consultant to provide a report complete with recommendations to the leadership team. Work together with existing agribusiness trainers and Saskatchewan Agriculture, Food and Rural Revitalization to engage regional participation of farmers and ranchers.

Action Plan

• Research federal and provincial methods used in agriculture in the past and the outcomes of processes used.
• Research sectors other than agriculture for successful models that may be applied to agribusiness.
• Research successful global models used in the agribusiness sector.
• Develop a model and test it in the region.
• Engage regional agribusiness leaders to become ambassadors of leadership training to encourage regional participation in training.
• Develop a regional agribusiness mentorship program.

Possible Sources of Leadership: Volunteers from the Agribusiness Leadership Team, Saskatchewan Agriculture, Food and Rural Revitalization, industry leaders, Saskatchewan Association of Rural Municipalities, Saskatchewan Rural Development, accountants, banks and credit unions, South West Centre for Entrepreneurial Development.

Southwest
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