The Ontario government has appointed a trustee to assume the Ontario Processing Vegetable Growers’ power to negotiate 2017 contracts with processors for the growing of processing tomatoes in the province.
The board of directors of the marketing board has been dismissed until new elections are held, as expected by the end of 2017.
“I have been closely monitoring the 2017 contract negotiations between Ontario’s tomato growers and processors and was recently informed by growers, processors and the Ontario Farm Products Marketing Commission (OFPMC) that negotiations have reached an impasse, jeopardizing this year’s crop season,” provincial Agriculture Minister Jeff Leal said.
“Risking this year’s tomato crop, and the thousands of jobs that support it, is something I am not prepared to do.”
Former Ontario agriculture minister Elmer Buchanan is the trustee and he will assume the powers of the board to negotiate a contract for the 2017 growing season.
Buchanan was, until recently, vice-chair of the OFMPC, the arm’s-length body that regulates agriculture organizations and marketing boards in the province.
He will hold the powers of the board until new board elections are held.
The former chair of the Ontario Processing Vegetable Growers (OPVG) board is calling for a quick new vote for a new board of directors.
Francis Dobbelaar, who farms near Wallaceburg, about 40 km south of Sarnia, said the board is democratically elected, and he believes it had the support of growers.
However, he expects Buchanan will appoint negotiators for processing tomato contracts.
“For all the wrong reasons the government is stepping in to make this decision. Obviously rural Ontario is not any concern and this is the tip of the iceberg.
“So much damage can be done to the industry in the short term. There will be contracts signed and all will be signed under duress,” he said, referring to the fact that farmers will have to negotiate independently with processors and will already have inputs and equipment bought for 2017 and beyond.
The Ontario Fruit and Vegetable Processors Association (OFVPA), meanwhile, hailed Leal’s move in a separate statement Friday.
“We look forward to working jointly with the OPVG, their appointed trustee, and our grower partners in putting together the details for this progressive move,” OFPVA president Steve Lamoure said.
Don Epp, OFVPA’s executive director, described the move as “a great opportunity to increase employment, economic investment, and grower tonnage. Working together truly works.”
The impasse is not surprising, as Leal quashed an OFPMC attempt to change the way that processing tomato contracts are negotiated, after an outcry from growers about the loss of power and the need for more consultation.
Contracts for all processing tomato growers are currently negotiated by the marketing board. That gave farmers the power to collectively bargain for price and conditions. If there’s no agreement, both sides submit a proposal to an arbitrator who makes one submitted price, or the other.
Processors have been looking to be able to negotiate directly with farmers, and the proposed OFPMC regulation would have given them that, by making the Ontario Processing Vegetable Growers a producer association without negotiating powers.
The processors issued a statement early in 2017 in which they said that without regulatory changes they would not be negotiating contracts for the 2017 growing season.
In August, Minister Leal put a halt to the OFPMC process citing the need for greater study and industry consultation before making such a significant change in how tomatoes are marketed in the province.
In a statement Friday he said his actions remain within the spirit of his directive in August to “develop a regulatory framework to achieve reform for the 2018 growing season and beyond.”
Dobbelaar said the OPVG had a report by independent consultant John Groenewegen, ready to be released next Wednesday, showing the competitiveness of the industry. Government already had seen that report. Dobbelaar didn’t know what would happen to the report now that a trustee is running the board.
The board had already negotiated contracts for processing crops such as sweet corn, carrots, onions and cucumbers for 2017, Dobbelaar said. It was negotiating with Sunbrite and ConAgra, when the two processors didn’t show up for a final day of negotiations on March 1.
“It signified there was a political change,” he said.
Highbury Canco (HCC) has been the largest push behind changes, Dobbelaar said. HCC was seen as the saviour of the former Heinz tomato processing plant in Leamington, but has significantly cut wages and costs and now Dobbelaar said it is going after the price it pays to farmers.
“One particular company, HCC, didn’t like the rules, so they tipped the tables in their favour,” he said.
The way the processing vegetable marketing board has been treated should be a warning to other agriculture boards, he said.
He also blames the high cost of doing business in Ontario, especially electricity costs, as a reason for processors to push the need for savings down to farmers.
“We had a good system, but the political optics weren’t just proper,” he said. “When the dust clears and the real truth comes out, the government will have made a big mistake.”
— John Greig is a field editor for Glacier FarmMedia based at Ailsa Craig, Ont. Follow him at @jgreig on Twitter.