Legislative changes prompt industry response

By Andrew Heck

Sébastien Angers is one of duBreton’s independent producer-suppliers. He is an agronomist by training and, since 2007, has operated an outdoor, organic farm near Ste.-Monique de Nicolet, about halfway between Montreal and Quebec City.

One of the few prospects more daunting than change itself, is forced change. In livestock production, the use of legislation to satisfy lofty social pressures has often placed farmers and consumers at loggerheads, to the detriment of both.

In 2016 and 2018, respectively, governments in the U.S. states of Massachusetts and California brought forth proposals to update spacing standards for livestock. Voters in both states approved. Massachusetts’ Question 3 was set to go into effect this year, but an industry-led court challenge has stayed its implementation, for now. Likewise, California’s Proposition 12 has faced implementation hurdles but is currently poised to come online early next year. Meanwhile in Canada, updates to the National Farm Animal Care Council’s (NFACC) Code of Practice for the Care and Handling of Pigs will mandate group housing for all sows by 2029, after an extension from the earlier 2024 deadline.

In business, setting yourself apart from your competition is one path to success. For duBreton, that path is well-travelled. The Quebec-based, integrated producer-processor raises hogs on its own farms, fed by its own feed mills, and also purchases from independent producers in Quebec, Ontario and the Maritimes. The hogs are slaughtered at the company’s own facility and further processed at its two other Quebec plants and one in New Hampshire, with a focus on cured products like bacon and sausage. With niche markets primarily in Japan, the U.S. and soon-to-be Europe, the business has grown steadily with ‘the times.’

The difference between duBreton and other major players on the Canadian scene is that, since the late 1990s, duBreton has actively pursued specialized designations for its products, including ‘organic’ and ‘certified humane.’ For many producers, and some consumers, it is easy to scoff at these descriptions. Products bearing such distinctions cost more to create, and they are more expensive at retail. As many consumers are already very price-sensitive, it may not make sense to dedicate so much energy to generating products that come with a higher price tag than comparable goods.

Opinions on the heavy-handed legislative approach to governing animal welfare varies widely within and outside of the industry. However, the proactive leadership historically shown by producers and processors – when it comes to taking small steps toward improvement – may not be enough for long, for some critical observers. As time goes on, the call for new requirements – whether scientifically based or not – grows stronger, and not just from animal activists but also among increasingly informed consumers. For at least some of those consumers, the inflated dollar amount is worth the money, and for the suppliers who are prepared to meet those expectations, like duBreton, the window of opportunity is wide open.

duBreton does it differently

Vincent Breton is proud to carry on his grandparents’ and parents’ legacy of producing high-quality food. Today, duBreton products are found in Canada, the U.S., Japan and Europe.

In 1944, Napoléon Breton and his wife, Adrienne, purchased a general store in Saint-Bernard, Quebec, about 50 kilometres southeast of Quebec City. The Bretons were looking at expand the business interests of their farming operation, which was established in 1928. In the 1960s, Lucien Breton took over from his father, and in 2019, Vincent Breton from his. Today, Napoléon’s grandson remains as President & CEO of the storied company.

“We want to do agriculture differently,” said Breton. “Being competitive in this area can be difficult, but we stand behind our values, and we strive for excellence, teamwork and sustainability.”

Constant evolution has been the name of the game for duBreton and the speciality pork market. In Japan, the company sells into Costco – one of the country’s most popular retailers – and in the U.S., Whole Foods, which has struggled to gain a foothold in the Canadian market.

“When we first started talking to Whole Foods, they were highly decentralized and did not have a lot of clear guidelines,” said Breton. “They used to visit our farms one at a time to determine whether they were acceptable.”

Over time, the company has earned certifications such as the Canada Organic Trade Association’s ‘Certified Organic,’ the U.S. Department of Agriculture’s (USDA) ‘Certified Organic,’ the Global Animal Partnership’s ‘Animal Welfare Certified’ and Humane Farm Animal Care’s ‘Certified Humane,’ all of which have contributed to demonstrating duBreton’s value proposition. As voluntary programs, they have given the company a boost over competitors that are now left wondering how quickly, cheaply and easily it may be to convert to a system that aligns with incoming legislative changes.

“It’s a huge commitment,” said Breton. “It’s not just a business aspect; it’s a cultural standpoint. People have to believe in it, and some people have not been able to embrace that change.”

The Whole Foods grocery chain’s growth in the U.S. is a testament to shifting consumer attitudes toward product claims that associate ethics with quality.

Speaking about the expectations and understanding of producers, Breton believes a shift in mindset may be in order: “Some producers believe they are the experts and the only ones who know about animal welfare. But at the end of the day, what does the customer like or dislike about what you’re doing?”

One of the most contentious issues between producers and packers surrounds profitability and value-sharing. The same legislative approach that has arbitrated hog and pork prices in Quebec has also handcuffed duBreton to an extent, when it comes to transitioning, since contract lengths are capped at three years.

“Integration has been the only way around this,” said Breton. “The regulations don’t work for us, currently, since it takes longer than three years to retrofit a farm and start producing pigs that meet our standards, so it’s a barrier for those who want to start working with us but also need to get paid.”

In addition to the problem of contract lengths, Breton rejects the concept of arbitrated pricing. Instead, he believes equity should come from the within the company, rather than external impositions.

“We pay based on cost of production,” said Breton. “One of the advantages of being integrated is that we control a lot of what we do, but we still rely on independent farms. We pay them like we pay ourselves, not based entirely on market fluctuations for the price of the animal.”

Despite obstacles that have taken years to overcome, duBreton has always prioritized its end-users over mass production and unchecked expansion.

“If we want farmers to survive and thrive, how do we do that?” Breton asked. “I don’t think it’s about trying to be the biggest company. I think it’s about raising the animal in the way that the consumer wants. If they want a red barn with windows and animals going outside, why not?”

Passion in pursuit of excellence

Whether in the office or on the gridiron, duBreton staff members believe strongly in the company’s values, and the commitment to upholding those values shows.

Marco Dubois is a human resources advisor with duBreton. He also moonlights as a professional football player. Hailing from La Salle, Quebec – a Montreal suburb – Dubois trades in his office attire for pads and cleats each spring. Currently, he is a receiver with the Ottawa Redblacks of the Canadian Football League (CFL).

“I was playing football at Laval University with Vincent’s nephew, who is also the son of our Vice President of Human Resources,” said Dubois. “At the time, I was looking for a job in my field of study, and duBreton was looking to hire someone in HR, so it worked out nicely.”

During the CFL season, Dubois and duBreton have a mutual understanding that football comes first, though Dubois remains as a permanent employee year-round. He works remotely as needed, but during the off-season and during bye weeks in the football season, he splits his time between duBreton’s corporate and processing offices in Saint-Bernard.

“I train every day, so work-life balance is very important,” said Dubois. “In my first year with the company, I even set up my own gym in a barn, but now, the company has gyms at its offices.”

Not only does duBreton offer employees on-site fitness opportunities, but the company also funds employees’ children’s enrolment in sports programs, and they recently began offering on-site daycare services.

“The company culture helps us stand out just as much as our product,” said Dubois. “The company values align with my own, including leadership.”

While he is fully committed to his football career, Dubois knows his playing days will not last forever. Post-playing, he would like to settle into a coaching role, while also staying in the pork industry, continuing to exercise his easily transferrable skills as people-person who works toward team success, lifting others up and helping them reach their potential.

Family connections run deep in the Dubois family as in the Breton family. Earlier this year, Marco’s grandfather, Jean-Guy, passed away. Jean-Guy lived with Marco’s immediate family for the better part of Marco’s childhood. He remembers Jean-Guy fondly, as his biggest supporter in sports, growing up.

“I learned a lot from my grandfather,” said Dubois. “He was very proud of me and happy I was able to get this job from such an awesome second family [duBreton]. They’re passionate people. They work hard and play hard.”

Change can and should come from within

Cost of production has jumped dramatically in the past two years, but so have hog prices. Is now the least difficult time to react to incoming sow spacing changes? Chart © Commodity Professionals Inc.

duBreton’s attempts to distinguish its products through forward-thinking production and processing have helped the company score significant touchdowns over the years. The company’s caring approach to pigs and pork translates into care for employees, cultivating an atmosphere in which winning comes naturally, though not without putting in effort.

Not every producer is willing or capable of taking their business back to the drawing board, as duBreton has done. And for the sake of diversity in the sector and consumer choice, that is fine. Hog prices in 2022 have been at a five-year high for most producers outside of Quebec, and packers processing conventional pork have experienced no shortage of revenue either. High on-farm costs continue to dampen profits, but the situation has certainly improved over recent years of sheer losses for many.

Values aside, the free market has a way of reflecting what consumers will tolerate. In most parts of Canada, average-income shoppers are likely not yet ready or willing to buy pork on product claims alone, especially at a premium price. But, globally, the appetite is there, and bellies are rumbling. duBreton’s game plan of creating niche products with a compelling story has driven the company’s success, and in the case of addressing societal conditions, the business case has proven itself.

It can be hard during good times to actively remember tougher moments in the industry, but it would be unwise for anyone to ignore the elephant in the room, which is legislative change and cultural evolution. With the clock winding down on incoming sow spacing requirements in Canada and the U.S., now may be as good a time as any to seriously consider making the investment in new practices, before it becomes a ‘hail Mary’ situation.