5-year agreement to resurrect former Heinz plant

Wednesday, May 21, 2014

by SUSAN MANN

As part of Highbury Canco Corporation’s purchase of the Leamington factory the company has an initial agreement with the H.J. Heinz Company for five years to make its juice, beans and canned pasta products, says a Highbury official.

Pradeep Sood, Highbury Canco director, says the company’s long-term plan is “to build our own brand for tomato-based products but not necessarily competing with Heinz. We believe there’s a market for certain other products, such as ethnic-based sauces and some other products like that. But our first year will be focused more on consolidating everything that we have purchased.”

Heinz announced today the deal with Highbury Canco to buy the Leamington facility has been completed and as of June 27 Heinz will cease operating the plant while Highbury Canco “will take over all aspects of the operation,” H.J. Heinz Company senior vice president of corporate and government affairs Michael Mullen says by email.

“We are pleased that Canco will manufacture some of Canada’s favourite products, including Heinz tomato juice, Heinz beans and Heinz canned pastas in the years to come,” Mullen adds.

Neither Mullen nor Sood would say how much Highbury Canco paid for the Leamington facility.

Sood says Highbury Canco has contracted with 10 southwestern Ontario tomato growers for product. That’s way less than the 43 growers who had been growing for Heinz.

But eventually Highbury will need more tomato farmers growing more acres. “That’s our hope that we intend to grow our operations and production, “ he says.

That won’t happen this season but “the following season we will need more growers,” he adds. The company will start with about 250 employees.

Highbury Canco has also obtained its processing license from the Ontario Farm Products Marketing Commission. Sood says they now have everything in place to operate the facility. “We are ready and we are oiling all the machinery to make sure that we get into this running.”

Sood says it has been exciting setting up the venture. “There were a lot of deadlines during the whole process; the tomato planting, the tomato growing, all kinds of stuff,” he notes. “It has been challenging but it has been good working with Heinz.”

Al Krueger, executive assistant with the Ontario Processing Vegetable Growers, says the board now has a pricing agreement with Highbury Canco. The company will be paying $119.50 a ton for tomatoes. “That’s the same as every other processor is paying for tomatoes for juice,” he says, adding the other provisions of the Highbury Canco agreement are the same as the agreement with other processors.

Krueger says “its good that something has come out of it.” Last November, Heinz announced it was closing the 105-year old factory that employed about 1,000 unionized, salaried and seasonal workers. Earlier this year, the tomato growers received compensation of $9 per ton based on the 2013 contracted tonnage of 200,000 tons. BF