By Connor Lynch
LEAMINGTON — The provincial government has destabilized and threatened the future of the very industry it intervened to protect, tomato growers charge.
An 11th hour government rescue mission to negotiate prices has left growers grumbling and wondering how many growers will stick with the industry next year.
Negotiations between the growers and processors had been tense. In December, the processors’ association accused growers of bad-faith bargaining.
Ag minister Jeff Leal stepped in and fired the board of directors of the growers’ association and appointed a trustee, Elmer Buchanan, a former NDP ag minister, to reach a price agreement. But growers say they got the short end of the stick.
The issue is not price as it will be based on California tomato prices. The issue is pricing discounts on volume and that has increased significantly, Leamington tomato grower Dave Epp told Farmers Forum.
Tomato growers say the new pricing does nothing but destabilize growers. “You watch this year, see how many people reinvest,” Epp said. “An industry that does not reinvest is dead.”
Previously, a grower who produced between 40 and 45 tonnes per acre gave the processors buying the crop a 0.5 per cent discount on every tonne. Grow over 45 tonnes, and the discount was one per cent.
This year, from 39 to 40 tonnes per acres, the growers must give a 0.5 per cent discount, at 40 to 45 tonnes per acre it’s a 1 per cent discount, and from 45 tonnes up it’s a 1.5 per cent discount.
Prices for tomatoes this year for growers could drop anywhere from 3 per cent to 9 per cent depending on how yields turn out, Epp said. No growers would leave the industry this year with inputs already in the fields, but next year is a different story, he said.
The growers see the move by the province to hire Buchanan as short-circuiting the arbitration agreement between the processors and growers. The price deal is a repeat of the Farm Products Marketing Commission’s efforts last year to remove the growers’ negotiating powers, Epp said. “They achieved this year what they were unable to achieve last year.”
The growers’ association filed a freedom of information (FOI) request in January, “looking for the amount of communications between the various players” around the negotiations to find out why, they believe, the province took sides against the growers. But as negotiator, Buchanan assumed the powers of the growers’ association board and cancelled the request.
“I wasn’t exactly sure what the purpose of it was,” Buchanan told Farmers Forum, adding that the request was too costly and would amount to thousands of dollars.
Buchanan said that he was appointed because several processors in Ontario had put on hold their plans to invest in new equipment and infrastructure. “The government was interested in getting those jobs. That wasn’t about to happen with all the turmoil going on,” Buchanan said. “There was significant opportunity for growth and jobs. I was sent here to try and rescue that.”
The growers’ chairman Francis Dobbelaar said, however, that final arbitration between the two parties was never considered. The processors, however, weren’t likely to show up. The arbitrator “looks for some middle ground,” Dobbelaar argued. “If you don’t want to negotiate, that doesn’t matter to an arbitrator.”
Buchanan countered: “It’s hard to make someone buy something if they don’t want to buy it.”
Getting out of tomatoes is now an option for growers as most grow other crops. Expensive investments in equipment, however, make it difficult. “I heard of a planter (for tomatoes) sold the other day,” Dobbelaar said. “Normally it’d be worth about $17,000. It went into auction and sold for $1,700. That’s a good indication of what people think of the industry.”
Tomato grower Pascal Jennan, one of the growers appointed by Buchanan to assist in negotiations, said that growers have hit rock bottom with this deal on pricing. “I think we want to work with this industry and have an industry but there’s nothing left to give.
“I believe the government has made unnecessary tension by taking away our duly-elected officials, which were trained to negotiate on our behalf. It was an undemocratic move.”