Growers left in lurch as CanGro plant closures go ahead
Tuesday, April 1, 2008
by MARY BAXTER
On Wednesday, Len Troup confirmed that he was aware there had been several offers on the plant. But they have all hinged on obtaining provincial support and so far such support hasn’t been forthcoming, he said.
In January, CanGro Foods Inc., announced it would close its plant in St. Davids near Niagara Falls at the end of March if a buyer can’t be found. The plant cans peaches and pears. Also on the block is the company’s plant in Exeter, which cans peas, sweet corn and other vegetables. The closures are related to the company’s decision to outsource its canned fruit and vegetable requirements, the company stated in January. The company’s tomato canning plant in Dresden is unaffected.
Troup said the St. Davids plant remains open but operations have slowed significantly and are likely geared to bridging the gap until the company’s first offshore shipments arrive in June or July.
While the company offered some compensation to growers who held production contracts with the plant, there was no negotiation on the amount and it wasn’t based on the value of the orchards. Nevertheless, it was picked up “almost by everyone,” he said, “because what are you going to do? You may as well take it.”
Troup has grown some peaches for the cannery over the years but has mostly geared towards the fresh market, said if growers want to sell their product in the fresh market. He says replacing existing trees with more appropriate varieties is necessary. That can be costly, he said; the Ontario Ministry of Agriculture, Food and Rural Affairs estimates costs of $14,000-$15,000 to replace and bring into production an acre of pear and peach orchard. Troup noted that the federal government had recently put $1,619 an acre towards the cost of removing orchards and vineyards.
The sudden involvement of 1,750 new acres in fresh markets could generate another serious problem: “It doesn’t take too much extra to overload a market,” he pointed out.
Troup said that he had been approached with the idea of starting a cooperative to buy the plant, but wasn’t convinced it made good business sense. He estimated $75 million would likely be needed to run the plant, annually. Growers would also have to compete with CanGro, which is holding on to its Del Monte, Aylmer and Ideal brands, to market their imported product.
“It’s not viable,” he said.
The situation has struck a chord with the broader public, he said. Troup said he has fielded 15 to 20 calls from people who expressed outrage at the situation. “All of these people are not talking about money here; they’re talking about part of our heritage, something that they think somehow we’re entitled to keep is being let go,” he said. “There is an emotional side that has really touched a nerve and I have never seen it before.”
A CanGro representative did not respond to Better Farming’s request for an interview. BF