Specified Risk Material (SRM) Collection for Nova Scotia: Regionalized versus Centralized Alternatives

Transcription

1 Specified Risk Material (SRM) Collection for Nova Scotia: Regionalized versus Centralized Alternatives Prepared by: Bettina B. Brown, M.Sc., P.Ag. Business Development and Economics Division Nova Scotia Department of Agriculture 176 College Rd., Truro, NS, B2N 2P3 June 2006

2 ACKNOWLEDGEMENTS The author acknowledges, with appreciation, the cooperation of the Nova Scotia Department of Agriculture and Fisheries (NSDAF), Nova Scotia Federation of Agriculture (NSFA), Nova Scotia Department of Environment and Labor (NSDEL), and Canadian Food Inspection Agency (CFIA). Special thanks to William Feltmate (NSDAF), Krista Vroegh (NSFA), Robin Mahoney (NSDAF), and Ken Grandy (CFIA) for providing the technical assistance that helped make this report possible. In addition, recognition is given for the contributions of those who provided valuable insight into the meticulous details embodied in this analysis. i

3 ACKNOWLEDGEMENTS... i LIST OF TABLES... iii INTRODUCTION... 1 BACKGROUND... 2 What is Bovine Spongiform Encephalopathy (BSE)?... 2 History of BSE in Canada... 4 Canadian Safeguards against BSE Transmission... 4 Proposed Changes to the CFIA Feed Ban... 7 ANALYTICAL FRAMEWORK AND METHODS... 8 Main Sources of Data... 8 Analytical Framework and Methods... 9 Model Assumptions Slaughterhouse Waste Deadstock and Downers SRM Transportation SRM Storage Economic Costs of the Collection of SRM Slaughter Offal Collection Deadstock Collection Storage of SRM RESULTS AND DISCUSSION Cattle Inventory, Slaughter Industry, and Deadstock Collection in Nova Scotia Cattle Inventory Slaughter Industry Deadstock Collection Estimation of SRM in Nova Scotia Provincially-Inspected Slaughter Facilities Uninspected Slaughter Facilities Deadstock Collection Estimation of Costs for SRM Collection (Base Analysis) Stationary Collection Mobile Collection Estimation of Costs for SRM Collection (Accounting for Current Practices) LIMITATIONS OF THE ANALYSIS CONCLUSIONS AND RECOMMENDATIONS SUGGESTIONS FOR FURTHER RESEARCH REFERENCES APPENDIX ii

4 LIST OF TABLES Table 1: Nova Scotia Cattle on Farms by Class (as of January 1) Table 2: Cattle Inventory by Class and County in Nova Scotia Table 3: Disposition of Cattle Nova Scotia ( ) Table 4: Cattle Inventory by County and Zone in Nova Scotia Table 5: Provincially-Inspected Facilities in Nova Scotia by Zone Table 6: Location of Uninspected Slaughter Facilities in Nova Scotia by Zone Table 7: Actual Deadstock Collection for Nova Scotia ( ) Table 8: Annual Comparison of Deadstock Collection for Nova Scotia ( ) Table 9: Estimated Slaughter SRM from Provincially-Inspected Facilities in Nova Scotia Table 10: Estimated Slaughter SRM from All Sources by County in Nova Scotia Table 11: Estimated Deadstock and Condemn SRM by County in Nova Scotia Table 12: Estimated SRM (Separated) from all Sources by County in Nova Scotia Table 13: Estimated SRM (Non-separated) from all Sources by County in Nova Scotia Table 14: Total Costs of Stationary Centralized SRM (Non-separated) Collection Table 15: Total Costs of Stationary Regionalized SRM (Non-separated) Collection Table 16: Total Costs of Mobile Centralized SRM (Non-separated) Collection Table 17: Total Costs of Mobile Regionalized SRM (Non-separated) Collection Table 18: Estimated SRM Requiring Collection with Current Practices Table 19: Costs of Stationary Regionalized SRM Collection (with Current Practices) Table 20: Costs of Mobile Regionalized SRM Collection (with Current Practices) iii

5 INTRODUCTION The Canadian Food Inspection Agency (CFIA) has proposed amendments to the existing feed ban to help minimize the potential spread of Bovine Spongiform Encephalopathy (BSE) and to improve the global image of Canada s livestock industry. These amendments are designed to strengthen the current safeguards by increasing the protection of cattle in Nova Scotia from exposure to and transmission of BSE (CFIA, 2006a). The proposed regulations will ban ruminant protein from animal feed, pet food, and fertilizer. This will likely have a negative effect on producers, ruminant slaughter facilities, and processing facilities, as each sector would endure economic costs associated with these regulatory changes. To meet these new regulations it is necessary to develop a sustainable management strategy for Specified Risk Material (SRM) containment/disposal within Nova Scotia. The first step towards the development of such a strategy is to determine the volume of SRM produced within the province and where it is located. In addition, an analysis that examines the costs associated with a province-wide SRM collection system is an important attribute, as such an analysis will provide insight into the course of action required to dispose/contain this material. The overall purpose of this analysis was to estimate the costs of regional and centralized SRM collection systems, on both a stationary and mobile basis, taking into consideration current waste management practices. The specific objectives of this study were: 1) To conduct a brief literature review of Bovine Spongiform Encephalopathy (BSE), its history in Canada, the current safeguards against BSE transmission, and the proposed changes to the CFIA feed ban. 1

6 2) To perform a statistical analysis of the beef and dairy industry and use this information to estimate the volume of SRM in Nova Scotia and how this material is distributed throughout the province. 3) To estimate the costs associated with province-wide SRM collection on both a regional and central basis, with emphasis on temporary versus fixed capital expenditure. This analysis provides an understanding of the costs of collecting SRM in Nova Scotia. The first part of this paper provides information on Bovine Spongiform Encephalopathy (BSE), its history in Canada, the current safeguards against BSE transmission, and the proposed changes to the CFIA feed ban. The next part of the paper sets up the analytical framework used to estimate the amount of SRM in Nova Scotia and how this material is distributed throughout the province. Lastly, the paper evaluates the costs associated with province-wide SRM collection on for a regional and centralized collection system, on both a stationary and mobile basis, and taking into account current disposal/containment practices. BACKGROUND What is Bovine Spongiform Encephalopathy (BSE)? Bovine Spongiform Encephalopathy (BSE), or Mad Cow Disease, is a progressive, fatal disease of the central nervous system which affects ruminant cattle (Canadian Cattlemen s Association and Beef Information Centre, 2006). It is one of several diseases known as Transmissible Spongiform Encephalopathies (TSEs), with 2

7 others including scrapie in sheep, chronic wasting disease in deer and elk, and Creutzfeldt-Jakob Disease (CJD) in humans (Canadian Cattlemen s Association and Beef Information Centre, 2006). These rare diseases are caused by an accumulation of abnormal proteins in the brain known as prions (derived from proteinaceous infectious particles) (Canadian Cattlemen s Association and Beef Information Centre, 2006). These proteins are present in the nervous system of all infected cattle (Canadian Cattlemen s Association and Beef Information Centre, 2006). The exact cause of BSE is not fully understood. However, the main symptoms of cattle afflicted with BSE include abnormal posture, difficulty in walking, lack of coordination, decreased milk production, weight loss, and aggressive or nervous behavior (CFIA, 2006b). The time lapsed between exposure to the disease and onset of clinical signs is on average 4-5 years, however, symptoms of the disease often does not appear until 2-6 months prior to death of the animal (CFIA, 2006b). This makes pinpointing the source of the disease extremely difficult. The spread of the disease is believed to have resulted from feeding cattle with meat and bone meal (MBM) from rendered ruminants that were infected (CFIA, 2006b). It is noted as the key pathway of infectivity of Britain s BSE crisis, whereby approximately 2 million cows were infected with the disease (AARI, 2005). Byproducts from packinghouses, abattoirs, and butcher shops are rendered to produce marketable products such as meal and bone meal (MBM), bloodmeal, and other animal protein byproduct meals (Rothsay, 2006). Since the prions are resistant to normal inactivation procedures, the rendering process may not completely destroy the infectious agent and the prions could remain active in the livestock feed (CFIA, 2006b). 3

8 History of BSE in Canada BSE has been a reportable disease in Canada since In total, there have been five reported cases of BSE in the country (CFIA, 2006b). The first reported case occurred in 1993, which was found in a beef cow that had been imported from Britain (CFIA, 2006b). In May 2003, the first domestic case of BSE was confirmed after the carcass of a beef cow in Alberta was condemned at slaughter (CFIA, 2006b). Two more domestic cases of BSE were confirmed by the CFIA in January One case was an older dairy cow from Alberta born in 1996, prior to the introduction of the 1997 feed ban, and the other was a beef animal born in March 1998, after the feed ban (Canadian Cattlemen s Association and Beef Information Centre, 2006). The most recent confirmed case of BSE in Canada occurred in January 2006, whereby a six-year old dairy cow tested positive for the infectious prion agent (Canadian Cattlemen s Association and Beef Information Centre, 2006). Fortunately, no meat or byproducts of either of these animals entered the human food or animal feed systems, as the animals were destroyed after BSE had been confirmed (Canadian Cattlemen s Association and Beef Information Centre, 2006). Canadian Safeguards against BSE Transmission The Government of Canada has safeguards in place to prevent the introduction and possible spread of BSE from infected animals to other animals and infected meat to animals and humans (CFIA, 2006b; Canadian Cattlemen s Association and Beef Information Centre, 2006). There are five main safeguards, which include making BSE a reportable disease, placing import controls on cattle, creating a National BSE 4

9 Surveillance Program for cattle, introducing a feed ban, and creating the Canadian Cattle Identification Program. In 1990, BSE became a reportable disease meaning in Canada. This means that any beef or dairy cattle exhibiting clinical signs of BSE, or any suspected case of BSE, is required to be reported immediately to a federal veterinarian (CFIA, 2006b; Canadian Cattlemen s Association and Beef Information Centre, 2006). Once reported, testing is conducted on the carcass to confirm the existence of prions in the animal s brain (CFIA, 2006b; Canadian Cattlemen s Association and Beef Information Centre, 2006). If BSE is confirmed, all parts of the animal s carcass are destroyed to prevent further spread of the disease (CFIA, 2006b; Canadian Cattlemen s Association and Beef Information Centre, 2006). In 1990, the CFIA also restricted the importation of cattle from the United Kingdom and the Republic of Ireland, as these countries were known sources of BSE (CFIA, 2006b; Canadian Cattlemen s Association and Beef Information Centre, 2006). Since then, the CFIA has expanded the import regions from which animals, certain feeds, and ruminant (cattle, sheep, goat, bison, elk, or deer) products have been restricted (CFIA, 2006b; Canadian Cattlemen s Association and Beef Information Centre, 2006). Furthermore, Canada only permits the importation of live ruminants and their meat products from countries that are considered BSE free (CFIA, 2006b; Canadian Cattlemen s Association and Beef Information Centre, 2006). Animal products from restricted countries are assessed on a case-by-case basis and can be imported only if they do not expose a risk of BSE transmission (CFIA, 2006b; Canadian Cattlemen s Association and Beef Information Centre, 2006). 5

10 The implementation of a National BSE Surveillance Program occurred in This program is used to determine the extent of BSE outbreak and to assess the effectiveness of the safeguards that are in place (CFIA, 2006b). BSE testing is conducted on the brains of cattle considered to be of high-risk of BSE such as cattle above the age of 30 months or those that have been in contact with infected animals (CFIA, 2006b). In 2005, for example, 58,000 high-risk animals were tested as part of this surveillance program (CFIA, 2006b; Canadian Cattlemen s Association and Beef Information Centre, 2006), which exceeds recommended guidelines set by the Office International des Epizooties (OIE). Currently, the CFIA requires the removal of SRM from all animals slaughtered for human consumption (CFIA, 2006b). SRM (or specified risk material) is defined as the skull, brain, trigeminal ganglia, eyes, tonsils, spinal cord and dorsal root ganglia from cattle over 30 months of age and the distal ileum of cattle under 30 months (CFIA, 2006b). The spread of BSE is believed to be transmitted by feeding ruminant-based MBM containing prions to other ruminants and, thus, the removal of SRM from ruminant feed can help prevent BSE transmission (CFIA, 2004). This was the main reasoning behind the design of the CFIA feed ban introduced in Canada in 1997, as it intended to decrease the likelihood of exposure to BSE through infected feed (CFIA, 2004). Since there is a delay in the onset of the disease from the time of exposure, traceability and tracking of cattle movement is a vital in the containment of BSE (CFIA, 2006b). In 2001, the Canadian Cattle Identification Program was created to track animal movements from the herd of origin to slaughter (CFIA, 2006b; Canadian Cattlemen s Association and Beef Information Centre, 2006). This helps to control the spread of BSE 6

11 and increases the effectiveness of tracing, containing, and eliminating diseased cattle (CFIA 2006b). It also helps to contain BSE transmission within the herd by eliminating cattle that have been in direct contact with the infected animal (CFIA, 2006b). Proposed Changes to the CFIA Feed Ban In December 2004, the CFIA proposed amendments to existing feed controls. These amendments will prohibit the use of SRM in animal feed, pet feed, and fertilizers (CFIA, 2006a). The definition of SRM will be expanded to include cattle deadstock, condemns, downers, road kill, zoo animals, research animals, and deadstock from other non-food producing species (CFIA, 2006a). In addition, every person who slaughters, cuts up, or debones cattle for human consumption will be required to stain the SRM and this material is to be collected using dedicated containers (CFIA, 2006a). Furthermore, no person can remove, receive, process, use, export or destroy SRM without a permit, which will be only issued for approved methods of disposal/containment (CFIA, 2006a). On-farm disposal of deadstock, however, is exempt from these regulations if all parts of the carcass remain on the farm (CFIA, 2006a). The proposed regulations are designed to prevent SRM from entering the animal feed production process and decrease the likelihood of cross-contamination during the production and distribution of animal feeds (CFIA, 2004). Preventing this high-risk material from being used to make animal feed will also help to decrease the potential for BSE exposure resulting from inappropriate on-farm feed usage. In addition, prohibiting the use of SRM in fertilizers will minimize the likelihood of contamination of grazing pastures and waterways (CFIA, 2004). Although, the proposed regulations will help to 7

12 strengthen the existing feed ban, CFIA has been estimated that the amendments could cost Canadians approximately $20-$27 million annually (AARI, 2005). ANALYTICAL FRAMEWORK AND METHODS Main Sources of Data This analysis used data from the Nova Scotia Department of Agriculture and Fisheries, Nova Scotia Federation of Agriculture, and Statistics Canada to assess the current inventory and distribution of cattle livestock in Nova Scotia. The data was extracted from six main sources: (1) 2005 Kill Stats, (2) 2005/2006 Dairy and Beef Livestock Inventory in Nova Scotia by Farm Location, (3) 2004/2005 Deadstock Collection, (4) 2001 Agricultural Community Profiles, and (5) 2006 Cattle Statistics. These reports provided various types of statistics. The first report provided statistics on the number of cattle slaughtered by class (bull, cow, heifer, steer, and calf) for each provincially-inspected facility. The second report supplied the number of beef and dairy cattle per farm in Nova Scotia. The next report provided monthly numbers on the total pounds of deadstock collected in the western and central service areas. The fourth report gave the population of cattle and calves per county in Nova Scotia. And, the last report supplied data on cattle inventory on farms by class as well as supply and demand (total disposition of livestock) of cattle including slaughter, deaths, and condemnations. 8

13 Analytical Framework and Methods Using Microsoft Excel, a model was developed to estimate the volume of SRM, distribution of SRM, and cost of SRM collection in Nova Scotia. A statistical analysis of the cattle inventory, slaughtering industry, and deadstock collection in the province was conducted to investigate the distribution of cattle inventory, the structure of the slaughter industry, and the deadstock collection service program in Nova Scotia. This information, along with a set of base assumptions, was used to estimate the amount of SRM available and where it is located throughout the province. This data was then used to provide information on the volume of SRM available in Nova Scotia, as both separated and nonseparated SRM. Separated SRM includes only the material listed as SRM by CFIA including the skull, brain, trigeminal ganglia, eyes, tonsils, spinal cord and dorsal root ganglia from cattle over 30 months of age and the distal ileum of cattle under 30 months. Non-separated SRM is all waste material from the slaughter process including SRM, bones, and soft tissue. The cost associated with the collection of SRM in Nova Scotia was inputted, both on a stationary and mobile basis, to assess two main scenarios: (1) centralized SRM collection and (2) regionalized SRM collection. Under each scenario, SRM was divided into three main waste streams including provincially-inspected slaughter facilities, uninspected and on-farm slaughter facilities, and deadstock collection. The base analysis assumed that there were no pre-existing waste disposal processes in place, providing information on the cost of SRM collection for the entire volume of waste available. The analysis then examined the collection costs of SRM not currently being disposed or contained. This was done by eliminating the volume of slaughterhouse waste collected 9

14 by Rothsay, the volume of waste currently composted onsite, and deadstock collected through the Deadstock Collection Service Program. Model Assumptions There were numerous assumptions regarding SRM in this analysis. The assumptions are divided into four main categories including SRM from slaughterhouse waste, SRM from deadstock and downers, SRM transportation, and SRM storage. Slaughterhouse Waste This analysis provided estimates of SRM as both separated and non-separated SRM. The volume of SRM in Nova Scotia was given in this manner because source separation is unlikely to occur. That is, unless the slaughter facilities are regulated and enforced (such as regular inspection, levy for volume of SRM above estimation from slaughter statistics, rendering tipping fees, or incentives to separate), they are unlikely to separate SRM from other carcass waste during the slaughtering process. The major reason given by representatives of the slaughtering industry was that source separation is a costly venture requiring separate slaughtering lines, collection, transportation, and storage. Therefore, the model assumed that all slaughterhouse waste (non-separated SRM) would be treated as SRM and included in the estimated costs of SRM collection. Cattle carcass waste is currently separated and stored in a general waste pile that consists of nonedible (human) material such as bones, head, guts, spinal cord, etc. This waste material is assumed to be equivalent to 50% of the animal weight, based on the 45-60% estimated (World Bank, 1998). Due to data limitations, the 2001 production year 10

15 (2001 Census) was used to represent cattle inventory in the model, particularly for its division of cattle into classes and to calculate the distribution of cattle throughout the province (by county). The estimates of cattle inventory by class for both provinciallyinspected and uninspected slaughter facilities was used to estimate the volume of slaughterhouse SRM in Nova Scotia. To calculate the volume of non-separated SRM produced by each cattle carcass, the model assumed that the total animal weight of cattle by class was as follows: bull 1350lbs, cow 1100lbs, heifer 550lbs, steer 700lbs, and calf 300lbs. Therefore, non-separated SRM was assumed to be 50% of these body weights by class. However, to estimate separated SRM several additional assumptions had to be made. The first assumption is that all cows are classified as SRM candidates since cows are female cattle that have been bred and therefore are greater than 30 months. The second assumption is that all bulls are classified as SRM candidates. The third assumption is that 10% of steers and heifers are classified as SRM candidates and 90% of cattle in those categories are less than 30 months and therefore only the distal ileum is SRM (Feltmate, 2006). The final assumption is that no calves are greater than 30 months and thus only the distal ileum is classified as SRM. To account for this in the model, separated SRM per class was assigned using a percentage of the total carcass weight as follows: bull 6.67% of 1350lbs, cow 6.67% of 1100lbs, heifer 6.67% of 550lbs for > 30mths and 4.0% of 550lbs for < 30 mths, steer 6.67% of 700lbs for > 30mths and 4.0% of 700lbs for < 30 mths, and calf 4.0% of 300lbs. 11

16 Deadstock and Downers This analysis defined deadstock as cattle that is classified as downers or that have died on-farm or in transit. These cattle are not processed at the slaughter facilities because they are classified as unfit for human consumption. Therefore, deadstock creates an independent waste stream. Services for deadstock collection are required to deal with the disposal of such animals. Statistics on the total monthly volume of deadstock collected as part of the Deadstock Collection Service Program (discussed in the results section) for the 2004/2005 season were used in the analysis, but this data was only available as total volume collected per month from the entire collection service area as opposed to number of animals or volume collected per county. Nonetheless, this data was used to estimate the volume of deadstock collected from each of the counties for which service was provided. This was accomplished by simply divided the total annual volume collected among the counties serviced based on total cattle population and area covered with each county. For simplicity, the volume was allocated as follows: 25% to both Hants and Kings counties, 20% to Colchester county, and 10% to Annapolis, Halifax, and Pictou counties. These estimates are used to isolate the deadstock waste currently collected from that which is available to be collected in order to estimate the costs of collecting SRM not currently being disposed or contained. According to Statistics Canada (2006), the number of deaths and condemnations of cattle in Nova Scotia is 6500 head, which represents 6% of the total cattle inventory. To estimate the total number of deaths and downer animals by county, data on total cattle inventory by class and county was multiplied by this percentage rate. That is, the 12

17 deadstock available was estimated by spreading the number of total deadstock in the province among the counties by multiplying it by the percentage of cattle inventory residing in those counties. These estimates gave an approximate number for the deadstock and downers in the province and where they are located by county. Since deadstock animals are already dead and downers are killed to be tested under the BSE Surveillance Program prior to rendering and separation of SRM is difficult after death occurs (Feltmate, 2006), 100% of the weight of these animals was assumed to be SRM in the model. SRM Transportation The analysis examined two collection systems: centralized and regionalized. Under each system, the SRM was divided into provincially-inspected slaughter facilities, uninspected and on-farm slaughter facilities, and deadstock collection. The collection and transportation of SRM was analyzed separately for each collection system. The location of the centralized collection system was assumed to be in the center of the province, which is Truro. This location corresponds well with cattle inventory, as it is located in the center of the most populated counties. The province was divided into five zones, which encompasses several counties per zone: zone 1 (Annapolis, Digby, Yarmouth, Shelburne, and Queens), zone 2 (Kings, Hants, and Lunenburg), zone 3 (Cumberland, Colchester, and Halifax), zone 4 (Pictou, Antigonish, and Guysborough), and zone 5 (Inverness, Victoria, Cape Breton, and Richmond). For simplicity, the mileage to transport the SRM to the centralized storage facility was assumed to be equal to the total kilometers traveled from Truro around each zone. The analysis assumed that 13

18 the three SRM waste streams (provincially-inspected, uninspected, and deadstock) were collected separately. Therefore, the collection mileage was calculated for each waste stream and applied accordingly. For the regionalized collection system, the province was divided into the same five zones. The mileage to transport the SRM to the regionalized storage facilities was assumed to be equal to the total kilometers traveled for a round trip from the designated storage site to each SRM location around the zone. For simplicity, the starting location for each zone were as follows: Digby for zone 1, Wolfville for zone 2, Truro for zone 3, New Glascow for zone 4, and Port Hawkesbury for zone 5. Like that of the centralized collection system, this analysis assumed that SRM waste streams are collected separately. The difference in the waste streams dictated two forms of SRM collection, one from slaughter facilities and the other from deadstock collection. The model assumed that the collection of slaughterhouse waste used a 10-wheel flatbed truck to collect and transport the SRM waste material. The dimensions of the truck were assumed to be 8'6" wide by 24'6" long. The model assumed that the collection of the deadstock required a 10-wheel garbage-type truck to collect and transport the SRM waste material. In addition, the number of trucks required was determined by the volume of SRM to be collected (to ensure adequate capacity), the hours required to collect the material (to ensure labor regulations are met), and the weight restrictions of the collection vehicle (to ensure the combined weight of each truck and cargo does not exceed the legal weight restriction of kg (or lbs)). Incorporating these constraints within the model dictated that a total of three collection vehicles for slaughter facilities and four collection 14

19 vehicles for deadstock collection were necessary for SRM collection services in the province. To collect the SRM from slaughter facilities, the model assumed that the facilities used collection tubs similar to grey fish containers as opposed to the 45 gal drums due to the high volumes at certain locations and the increased transport mobility that such tubs provide. Two sizes of collection tubs were used in the analysis including large collection tubs (750L) that could hold 650lbs and small collection tubs (250L) that could hold 200 lbs of carcass waste. In addition, empty 750L tubs weigh approximately 75kg (or 165lbs) and have the dimension 3x3x3, whereas empty 250L tubs weigh approximately 25kg (or 55lbs) and are 3x2x2. Due to design of these tubs, strength restrictions apply whereby the large tubs can be stack two high and the small tubs can be stack three high during transport. The collection of deadstock did not require storage tubs, but did require the collection vehicle to be equipped with a winch to pull the whole carcass into the storage compartment. Given the nature of SRM, it decays quickly resulting in several environmental problems such as odor, fly propagation, and bacterial issues. To minimize these problems, frequent pick-up of the carcass waste would be required. The model assumed that the collection of SRM from slaughter facilities required three trips a week to each location and therefore the SRM available at each location was divided into 156 trips to determine the volume per trip. It was assumed that multiple locations were visited on each trip to a particular zone. As for SRM from deadstock, the model assumed that this waste would to be collected twice a week because a carcass as a whole would decay at a slower rate than one that was slaughtered due to decreased surface area exposed with the 15

20 hide intact. Therefore, the SRM available in each county stemming from this waste stream was divided into 104 trips per year. Several assumptions were also incorporated into the model regarding the labor requirements for SRM collection. For slaughter facilities, the labor was estimated based on the calculation that 80 km in travel is equivalent to 1 hour of labor and each stop is allocated 0.25 hour for loading requirements. For deadstock collection, labor is estimated based on the same travel time, but each stop was allocated 0.10 hour for loading requirements. In addition, it was assumed that each employee worked maximum of 44 hours prior to overtime and that operation occurred between Monday and Saturday. Furthermore, a maximum allowable of 900 km was allocated to each trip. SRM Storage The storage facility used to store SRM after it has been collected was assumed to be of two types: stationary and mobile. Regardless of the storage type, the storage space required was determined by the number of tubs of SRM collected plus the carcass weight of deadstock collected per week. For the stationary storage facility, the large tub (750L) was assumed stackable to a maximum of three high, whereas the small tubs could be stacked five high. The model also assumed that each deadstock carcass weighed an average 800lbs and would encompass storage space of 3'x4'x8' within the storage unit. The deadstock carcasses (whole carcasses including hide) could be piled as high as safely possible within the unit (with a bracing system in place). In addition, the model assumed that the storage facility is emptied on a weekly basis, regardless of the storage type. 16

21 The model assumed that the stationary storage facility was a steel dome building from Future Steel Buildings. The building kit included steel arches, front and end walls, two 4'x7' steel service doors, and a 12'x14' opening for trucks. The building requires a concrete pad with footings suited for the size of building. It was assumed that the centralized collection system required a 50 x100 building, whereas the regionalized collection system required a 50 x60 building for each of the five zones. The dimensions required for unloading, such as at least 12'x36' space for backing the collection truck into the facility and 10'x10' space around the entire collection vehicle for forklift operation, were incorporated into the model. It was assumed that a forklift is used for loading and unloading of the collection vehicles. Estimates used specs for a Princeton PiggyBack diesel PB50 series, which has 5000lbs capacity with 48" forks and a max. lift of 144". The piggyback forklift hooks to the back of each slaughterhouse waste collection vehicle. A reefer trailer was assumed to be purchase to use as the mobile storage unit and each reefer trailer was emptied on a weekly basis. The reefer trailer was assumed to be a 53 Manac tridem airide reefer van with a Thermo-King SB refrigeration unit with a 230/3/60 electric standby. The model assumed that the trailer was equip with a moisture proof floor membrane to help prevent leakage, extra wall reinforcements with 12 centers to improve the walls weight bearing capacity, reflective aluminum roof and extra insulation to help maintain temperature below 0 0 C, and a load tracking system to secure load from shifting during transit. The trailers also have anti-skid inverted-t floors and a collection tank at the end of the reefer to collect liquid and prevent leakage. It was assumed that the deadstock SRM is placed on pallets to allow for air circulation. The deadstock is transferred from the collection truck to the storage unit by using a winch 17

22 system attached to the roof of the trailer. As for slaughter SRM, it was assumed that the forklift was used to transport the collection tubs from the collection truck into the reefer trailer via a portable forklift ramp. To transport the collected SRM to the disposal/containment site, the total weight of the tractor, reefer trailer with piggyback forklift, and cargo cannot exceed 41,500 kg (or 91,492 lbs). The model ensured that this weight restriction was met in all estimates. Economic Costs of the Collection of SRM There were numerous assumptions that were made within the model to estimate the economic costs of collecting SRM in Nova Scotia. These costs are broken into three main categories: slaughterhouse waste, deadstock collection, and SRM storage. Slaughter Offal Collection The model assumed that there were several costs associated with the collection of slaughter waste. First, the model assumed a cost for purchasing the collection tubs that were used to store SRM at the slaughter facilities and transport the material to the storage facilities. In the analysis, the large collection tubs were assigned a cost of $500 each, whereas the small collection tubs cost $150 each. Regardless of tub size, the tubs were assumed to have a 5-year life expectancy. Next, there were costs associated with using a special vehicle to collect the SRM. For the collection of SRM from slaughter facilities, the purchase price of the flatbed truck was estimated at $95,000. These vehicles were assumed to have a 10-year life. For simplicity, straight-line depreciation was used to calculate the annual depreciation of 18

23 these vehicles, which was estimated at $14,600/yr for each vehicle. The cost of the loan for the collection vehicle was based on a 7.14% interest (70 year average for ) and a 60 month term. Thus, the interest cost of each loan was estimated to be $4196/yr. There were costs associated with the operation of the collection vehicles estimated in the model. The fuel mileage of the collection truck was estimated at 8 miles/gallon (or 2.83 km/l) and the fuel price was assumed to be $0.92/L (or $4.17/gal) based on current price less HST. The insurance cost per truck was estimated at approximately $4000/yr and maintenance costs (including tires, repairs, and other miscellaneous costs) was estimated at $6000/yr. In addition, miscellaneous costs such as licenses and registration were set at $1187/yr (Nova Scotia Registry of Motor Vehicles, 2006). Lastly, there are labor costs for the collection of slaughter SRM. It was assumed that personnel were paid $14.60/hr based on a 40 hour week. In addition, administrative costs were estimated to be $10,000/yr, which was based on 30% of the average administrative costs for county organic waste collection in Nova Scotia (MacQueen, 2006). Deadstock Collection The model also assumed there were several costs associated with the collection of deadstock SRM. First, due to the nature of the material (whole carcass versus slaughtered parts), the collection vehicle was different then that required for slaughterhouse SRM collection. The purchase price of the garbage-type collection vehicle with the necessary equipment for the collection services was estimated at 19

24 $180,000. For simplicity, straight-line depreciation was used to calculate the annual depreciation of each deadstock collection vehicle, which was estimated at $33,120/yr. Like that of the collection vehicle for slaughterhouse SRM, the cost of the loan for the deadstock collection vehicle was based on a 7.14% interest (70 year average for ) and a 60 month term. This resulted in an estimated for interest cost of $ /yr for each vehicle purchased. All other costs and assumptions were similar to that of those discussed for slaughter waste collection. Storage of SRM There were several costs assumed within the model for the storage of SRM. First, there were building construction costs to estimate. For stationary storage facilities, the building material costs differed depending on whether the collection system was centralized or regionalized. For the centralized collection system, one 50 x100 building was required, which had a purchase price of $51,266 for the building and $17,000 for the concrete pad. For the regionalized collection system, a 50 x60 building was required for each of the five zones and each building had a purchase price of $34,164 and concrete pad costs of $12,000. In addition, the insulation and refrigeration cost for each centralized building was estimated at $12540 and $30,000, but for each regionalized building these costs were estimated at $8840 and $20,000. The construction of each building was assumed to be the same regardless of building size. Each building required four days of labor with four laborers working 10 hour days and the hourly rate for a construction laborer is $11.50/hr. The electrical work required 24 hours of labor for two electricians and the material costs $1000 and the hourly rate for an electrician is $17/hr. 20

25 The plumbing work required 24 hours of labor and the material costs $1000 and the hourly rate of a plumber is $15.45/hr. The washroom facility costs $1000 complete including materials and labor. The other costs included building permits, fees and other unforeseen costs estimated at $3000 per building. It was assumed that each building was located such that municipal water and sewer is available. All material and construction costs was used to estimate the overall loan required and the annual cost of the loans were $5540/yr and $554/yr for the central building and $3885/yr and $388/yr for each regional buildings. For the mobile storage unit, there is no construction costs assumed since the entire storage system is a temporary setup. That is, there are no permanent structures. However, there are annual costs associated with the purchase of the reefer trailer. The unit price of each reefer was estimated to be $91,880. The depreciation of each trailer was estimated at $ /yr and interest cost on the loan to purchase each trailer was estimated at $ /yr. In addition, the number of reefer trailers required per zone is dependent on the volume of SRM to be collected in each zone and the transportation weight restrictions for the collection vehicle. For this reason, the collection of total SRM available throughout the province required a total of seven trailers onsite (one at each zone with two located in zones 2 and 3) plus one replacement reefer trailer (an empty trailer left onsite in place of the trailer in transit to the disposal/containment site). For the collection of SRM that is not part of the current collection process, a total of six trailers onsite (two located in zone 3) plus one replacement reefer trailer was assumed in the model. 21

26 Next, there is labor costs associated with the storage. For the stationary storage building, the analysis assumes there was operational labor cost for a warehouse operator. The warehouse operator was assumed to be a fulltime employee who worked a total of 40 hours per week and who was paid an hourly rate of $18.11/hr. The warehouse operator was assumed to be responsible for the coordination of the warehouse activities (loading and unloading of the waste material) and for the security of the premises. For the mobile collection system, most of these costs can be avoided. Since the storage facility is not a permanent structure, the model assumed that such facilities would not require fulltime warehouse personnel. The model also estimated other operational expenses such as power, water, maintenance, and miscellaneous costs. For the stationary building, the power, water, and miscellaneous costs were estimated at $200/mth, $30/mth, and $500/yr respectively. For the mobile reefer trailer, it was assumed that the trailer would be located near a 3-phase power source. The estimated cost of power (required to maintain the reefer temperature when stationary) was estimated at approximately $1800/yr. In addition, the model assumed a refrigeration cost for fuel of $867/yr, which was incurred to maintain temperature within the reefer during transport of the SRM to the disposal/containment site. Other costs estimated include refueling maintenance estimated at $100/yr, oil/filter maintenance costs estimated at $188/yr, and other maintenance costs estimated at $150/yr. There were also costs estimated within the model for the required equipment to transport the SRM within the storage units. The analysis assumes that each slaughterhouse waste collection vehicle had a piggyback forklift attached to it for loading 22

27 and unloading purpose. The purchase price of the piggyback forklift was estimated at $45,000 and it was associated with a depreciation, interest, and maintenance costs of $7200/yr, $ /yr, and $1000/yr, respectively. In addition, it was assumed that the mobile reefer units required portable forklift ramps to transport the SRM from the collection vehicle to the storage trailer. The purchase price of the forklift ramps was assumed to be $15,500, which is associated with annual depreciation costs of $1240 and annual interest costs of $637. The total storage costs differed significantly between the four types of collection systems (stationary centralized, stationary regionalized, mobile centralized, and mobile regionalized). For stationary storage, the centralized system only required one storage building, whereas the regionalized system required five storage buildings, one for each zone. The model estimated the centralized storage costs totaled $47,022/yr and the regionalized storage costs totaled $226,009/yr for the stationary collection system. For the mobile collection systems, the model assumed that the storage costs were the same for both central and regional SRM collection. This assumption was based on the volume requirements of the SRM available, which dictated the same number of reefer trailers to store the material regardless of the type of collection system. These costs were estimated at $230,294/yr for each mobile collection system (both centralized and regionalized). RESULTS AND DISCUSSION The model was designed to conduct four specific tasks: (1) to perform a statistical analysis of the beef and dairy industry; (2) to estimate the volume of SRM in Nova Scotia and how this material is distributed throughout the province; (3) to estimate the costs 23

28 associated with province-wide SRM collection on both a regional and central basis, with emphasis on stationary and mobile storage; and (4) to examine the difference in collection costs when current disposal/containment practices are considered. The results of these analyses are given in the following sections. Cattle Inventory, Slaughter Industry, and Deadstock Collection in Nova Scotia The statistical analysis of cattle inventory, slaughter industry, and deadstock collection was necessary to understand the distribution of cattle inventory in Nova Scotia, the structure of the slaughter industry, and the current method of deadstock collection. Cattle Inventory The cattle inventory has remained relatively steady since the new millennium, however there has been a decline of 3.7% between 2000 and 2006 (Table 1). In 2000, the number of cattle in Nova Scotia totaled 109,000 head, whereas, in 2006, this number fell to 105,000. Due to the nature of the beef and dairy industries, the division of the cattle inventory into classes (such as bull, cow, heifer, steer, and calf) showed that more than 75% are cows and calves. In addition, replacement heifers accounted for 10% of all cattle in the province. In 2001, Nova Scotia s cattle industry was mainly concentrated through the northern region (Annapolis, Kings, Hants, Colchester, Cumberland, Pictou, and Antigonish counties) of the province (Table 2). Dairy farms were located primarily in Kings, Hants, Colchester, Cumberland, Pictou, and Antigonish counties, whereas the beef farms extended farther across the province to encompass Annapolis, Inverness, and 24

29 Lunenburg counties. Overall, more than 75% of total cattle farms and cattle inventory resided in this region. Divided into zones, more than 80% of the cattle inventory were in zones 2, 3, and 4 (Table 3). This analysis showed that if a 90-95% SRM recovery rate is to be achieved, the widespread nature of the cattle industry in Nova Scotia will likely make SRM collection and disposal/containment a complicated and costly venture. Slaughter Industry In 2004, the number of cattle slaughtered was 24,900 head, whereas the total cattle inventory was 105,500 head (Table 4). This shows that the number of cattle slaughtered represented 24% of total cattle inventory. According to NSDAF (2005b), the number of cattle slaughtered in provincially-inspected facilities was cattle, which represents only 47% of cattle that were slaughtered. The number of cattle slaughtered by uninspected facilities was estimated simply by subtracting those slaughtered in provincially-inspected facilities (11630 head) from the total number slaughtered (24,900 head). Therefore, the number of cattle slaughtered in such facilities was assumed to be 13,270 head. Currently, there are seventeen provincially-inspected facilities that slaughter cattle, which vary in size and scale (Table 5). These facilities are spread throughout the province, with facilities located in 10 of the 18 counties including Digby, Annapolis, Queens, Kings, Hants, Colchester, Cumberland, Pictou, Antigonish, and Cape Breton counties. Several counties have multiple slaughtering facilities including Kings, Hants, Colchester, Cumberland, and Pictou counties. The location of the provincially-inspected 25

30 facilities corresponds well with cattle inventory, as 75% is located within the northern region of the province. Currently, there are 35 uninspected facilities listed in the province (Table 6). These facilities are spread throughout the province. There are a number of uninspected facilities in each represented county including Digby (4), Kings (3), Hants (3), Lunenburg (3), Colchester (6), Cumberland (4), Halifax (4), Pictou (3), and Cape Breton (5). The uninspected facilities are mainly concentrated in zones 2 and 3, with 66% of the facilities residing there. However, the number (and class) of cattle slaughtered in these facilities is unrecorded. In addition, part of the slaughter waste from provincially-inspected facilities (including SRM) is collected by the local rendering plant, Rothsay in Truro. There are five slaughterhouses included in the regular run including entire waste collection from O.H. Armstrong Ltd., Brookside Abattoir, and Dickies Meats and bone waste collection from Moxsom Meats and Harold Ferguson. Furthermore, there are seven provinciallyinspected facilities involved in onsite composting. These include entire waste composted at Bowlby s Quality Meats, Reid s Meats, W.G. Oulton & Sons Ltd., James W. Baillie, and Mattie Farms and soft tissue waste composted at Moxsom Meats and Harold Ferguson. Of these, Bowlby s Quality Meats and W.G. Oulton & Sons Ltd. are part of the provincial composting pilot project. Deadstock Collection The Nova Scotia Federation of Agriculture (NSFA) administers the Deadstock Collection Service Program in the province. Current deadstock collection is focused in 26

31 the central and western regions of Nova Scotia, which encompasses parts of Annapolis, Kings, Hants, Colchester, Halifax, and Pictou counties. There are currently two deadstock operators, one for each region. The deadstock operators collect the cattle carcasses from various farm locations, transport the carcasses to their facilities for skinning and dismembering, and deliver the dismembered carcass to Rothsay for rendering. The deadstock collector currently receives $0.065/lb for all deadstock cattle collected. In addition, the BSE surveillance program, administered by the Canadian Food Inspection Agency (CFIA), pays $75 per bovine brain to the deadstock operator. The carcasses of the surveillance deadstock are held in a stationary reefer trailer until a negative report is obtained, at which point the entire carcass is then sent to Rothsay for rendering. The volume of deadstock collected in was recorded monthly, with the total volume at 870,420 lbs (or 395 tonnes) (Table 7). During this period, the total volume of beef and dairy deadstock collected was 870,420 lbs. Over the past decade, deadstock collection has been unstable, with three obvious trends shown as periodic changes in the volume of waste collected (Table 8). Between 1998 and 2000, collection of beef and dairy deadstock decreased by 6.3%. The volume of waste collected steadily increased between 2000 and 2004, with 494,710 lbs (or 224 tonnes) collected in 2000 and 971,940 lbs (or 441 tonnes) collected in Since 2004, the volume of beef and dairy deadstock collected has again decreased, but this period showed an overall decrease of 16.5%. In 2005 (which represents the same period given as in Table 7), the deadstock collectors collected approximately 870,420 lbs (or 395 tonnes), whereas in 2006 they collected 811,915 lbs (or 368 tonnes). 27