By Connor Lynch
MORRISBURG — Organic grain buyer Homestead Organics’ rapid expansion has been cut back after Agricorp suspended its grain-buying license for tardy payments to suppliers.
The Eastern Ontario organic marketer expanded into Sebringville, just west of Kitchener, in 2016. The company also renovated and expanded its Morrisburg location in the same year. “It was really ambitious,” said company president Tom Manley.
The Sebringville feed mill in particular is a “very good opportunity, in the long-term; it’s relevant and valuable. But it was too much too quickly,” Manley told Farmers Forum. The company was hoping to take advantage of Southwestern Ontario’s much larger population of organic farmers. “(They have) both greater numbers, and greater concentrations, than Eastern Ontario.”
The company’s grain buying license was suspended by Agricorp last November because it was paying farmers too slowly for their grain. Manley said that in the short-term, it’s “business as usual,” because Homestead Organics is buying grain through third-parties, and “still paying farmers, just slowly.”
Long-term, “it’s going to take many months to present a balance sheet that will be favourable to Agricorp,” Manley said.
The company laid off two employees, cut back on discretionary expenses like marketing and memberships, as well as reducing employee travel and training to help balance the books.
“Our situation might appear dire. And yes, we are in distress. But we are receiving tremendous support,” Manley said. “Farmers are still supplying us. They haven’t cut us off, and we do very much appreciate their support as we go through a difficult phase.”