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Cash for caribou

Darrell Greer
Northern News Services

Coral Harbour (Feb 16/05) - The Southampton Island caribou harvest is a go in 2005, thanks to $500,000 provided by the Nunavut government and the Nunavut Development Corp. (NDC)

NDC's Darrin Nichol said the company has kicked in $200,000 towards this year's hunt by paying a higher price for the meat.

The GN paid off $200,000 worth of debt the Coral Harbour Development Corp. had from previous years and kicked in an additional $100,000 towards this harvest.

Nichol said while there is an application for financial assistance pending before Indian and Northern Affairs Canada (INAC), the NDC can't afford to wait.

"We have to move now, so NDC agreed to pay a premium on the meat, recognizing the $200,000 may not be forthcoming from INAC," said Nichol.

"But, should that money be received, the price we're paying for the meat will be adjusted accordingly."

The entire amount of meat from the hunt allocated for commercial sale goes to Kivalliq Arctic Foods in Rankin Inlet, a subsidiary company of the NDC.

Nichol said the NDC is mandated to place an emphasis on job creation and economic development in Nunavut.

He said previous years have demonstrated there's sufficient demand for the product produced by the hunt.

"We had a great deal of trouble selling this product five years ago, but today the product is sold before it hits the cutting room floor and we certainly see that potential."

Nichol said the NDC will be testing the market this year due to the fact it's paying more for the meat.

He said it remains to be seen what price increase the market will bear.

"It will be a watershed year in that respect because the market might tell us it's a good product, but not that good.

"Our customers might say they can't afford to put our product on their restaurant tables at a higher price because people just won't buy it.

"Or, they might say people are still lining up to buy it and we'll still purchase it at the new price."

Nichol said the NDC has a captive market, but only time will tell how far being the only company in North America providing superior caribou cuts can carry it.

"We feel we can continue to do quite well with the prime cuts of caribou and will recover some, if not all, the increases pertaining to those cuts of meat.

"However, there's other parts of the animal that may be looked upon as less desirable cuts, such as the ground meat, that we're going to have difficulty with."

Substantial hike

The NDC is looking at an average increase of 25 to 30 per cent on its products.

Some of the prime cuts may actually be raised 40 per cent, with lesser cuts raised in the 15 to 20 per cent range to balance the price increases.

Nichol said the next six months will determine whether the project is sustainable with the increased costs.

He said the NDC will decide by summer's end if the project will go forward.

"The board of directors made it clear that we're not committed to this at all costs, but there are also significant risks associated with not doing it as well.

"There's been a lot of work done during the past 10 years on this project."

A lot to lose

Nichol conceded the NDC would have to look long and hard before walking away from the project.

The price in doing so would be staggering, with the loss of jobs in Coral Harbour (a non-decentralized community in the middle of winter), and 12 or more full-time jobs in Rankin Inlet.

Nichol said there are also other areas that don't show up on a balance sheet.

He said caribou products from Kivalliq Arctic Foods are strongly associated with the territory of Nunavut.

"That's important because Nunavut doesn't have a whole lot out there in the marketplace.

"This may be the only primary product line people can buy and associate with this territory."

No guarantees

Nichol said NDC products have been served on Team Canada trade missions to Europe and at other functions of international and national importance.

He said people seek out the Kivalliq Arctic Foods brand because of its quality.

"Our products represent Nunavut and Canada and that's never going to show up on the bottom line.

"When we looked at the big picture, we felt it was prudent to go forward this year.

"But there's no guarantee we'll continue on after that.

"That decision will, ultimately, be made by the market."