An uncertain future for canning plants

Friday, January 11, 2008

by MARY BAXTER

Members of the Ontario Tender Fruit Producers' Marketing Board will meet next week with representatives from the only remaining fruit canning plant in North America east of the Rockies to discuss its proposed closure.

This week, CanGro Foods Inc. announced it will shut two of its Ontario plants on Mar. 31 if buyers can't be found. The plants are located in St. Davids, near Niagara Falls, and at Exeter. The company's third Ontario plant, located in Dresden, is unaffected.

The general manager of the processing vegetable board was not available for comment.

However, Kirkton-area farmer Peter Sereda, who annually grows about 175 acres, combined of peas and corn for the company's Exeter plant and in the past provided harvesting services, said he's optimistic a buyer will be found for that plant.

"My feeling is there's a probably 75 per cent chance the plant will get bought up by another company, and then they'll be back to full steam again, is my guess," he said.

The plant is "almost too good a plant to let go," he said, adding that he's heard there may be some potential buyers and even the possibility of a freezing line being added.

But if it does shut down, it would deal quite "a little blow" to the area; Sereda pointed out not only would farmers be affected but also workers and other spin off businesses.

Bill Denham, who grows about 50 acres of sweet corn annually for the company, says if the plant does close, the impact on growers won't be substantial. Farmers "can always swing to another crop."

But that swing, along with the loss of employees may make it difficult to get the plant up and running again if a buyer is found after the Mar. 31 deadline, he said.

Meanwhile, the tender fruit board predicts the closure of the St. David's plant could have a substantial impact on the local farm community.

In total, 150 clingstone peach and processing pear growers who annually grow 600 acres of processing pears and 1,000 acres of peaches for the plant would be affected.

The board estimates the loss will be more than $4 million to area farmers.

After its Jan. 16 meeting with the company, the board will meet with the affected growers.

"CanGro is preparing settlement offers for their contracted growers," the board's news release stated, and noted the offers would take into account length of the contract, past history of deliveries, projected future deliveries and the age of the trees.

David Hoyles, a spokesperson for the Toronto-based CanGro, said the company had also closed a vegetable plant in Quebec in 2006.

The company will begin outsourcing its canned vegetable and fruit requirements, he stated in the release.

CanGro markets canned fruit, tomatoes and vegetables under Del Monte, Aylmer and Ideal brands.

In May, 2007, it sold its Aylmer and Primo brand soup business to Baxters Canada Inc. BF