Processing tomato prices disappoint growers

Tuesday, April 30, 2013

by SUSAN MANN

Ontario’s processing tomato growers went to arbitration with the hopes of obtaining a price increase for the crop but have come away disappointed after an arbitrator decided in favour of the processors’ position.

Reasons for the decision, delivered last month, have not yet been released.

Al Krueger, executive assistant with the Ontario Processing Vegetable Growers, says the tomato talks were the only ones that went to arbitration this year of the 12 crops they negotiate. “Our final offer was for higher prices (over last year) and the arbitrator ruled in favour of the processors’ offer.”

The three processors, Del Monte Canada Inc., Sun-Brite Foods Inc. and H.J. Heinz Company of Canada LP, had different offers so it was “three separate arbitrations” and they now all have slightly different prices and different contract terms with respect to productivity, he says.

Overall, the processors’ offer will result in a slight decrease in prices for farmers compared to last year. “We’re waiting to hear the reasons,” he says.

Walter Brown of Leamington, chair of the tomato negotiating committee, couldn’t be reached for comment.

To characterize this year’s negotiations, Krueger says tomatoes were more difficult to negotiate compared to the other crops. Processing tomatoes are the biggest crop the Ontario Processing Vegetable Growers organization represents with 12,000 acres grown in Essex County, Chatham-Kent and a few acres in Lambton County. “All in all, most crop prices were up nicely with the exception of tomatoes,” he says.

John Lugtigheid, who doesn’t grow processing tomatoes but was on the tomato negotiating committee, says “there were hardly any negotiations. They (the processors) were set to come in at a negative price and we didn’t think it should be negative.”

Growers are surprised the arbitrator ruled in favour of the processors’ position. “Tomato growers are very disenchanted,” Lugtigheid notes.

He says there hasn’t been a price change in almost 10 years for processing tomatoes but costs keep going up.

Some of the processing vegetable agreements reached this year are:

• The carrot settlement reached with Bonduelle Ontario Inc. and Campbell Company of Canada is for $96.50 per ton for dicers compared to $90 per ton last year and $125.50 per ton for slicers compared to $119 per ton last year.
• The squash agreement reached with Bonduelle Ontario Inc. for processing squash is $134.50 per ton for hand harvest and $118.50 per ton for machine harvest.
• The cauliflower agreement reached with Bonduelle Ontario Inc. is $510 per ton for Grade No. 1 and $207 per ton for Grade No. 2.
• There was no change in pricing for green and wax beans for this year in the agreement reached with Bonduelle Ontario Inc.
• In the beet agreement with Del Monte Canada Inc. the minimum for each ton is $179.19 for No. 1 (one inch to 1 5/8 inches); $149.14 for No. 2 (1 5/8 inches to 2½ inches); $109.07 for No. 3 (2½ to 3 inches); $63.44 for No. 4 (3 inches to 3¾ inches; and $63.44 for over 3¾ inches). The beet prices for this year are up five per cent compared to last year, Krueger says.
• In the sweet corn agreement with Bonduelle Ontario Inc. the price will be $111.25 per ton, up $8.75 per ton from 2012.
• For the green pea agreement with Bonduelle, all tenderometer categories increased by about $13 per ton.
• In the cucumber agreement with Hartung Brothers the minimum for each ton this year is $840 for No. 1 (5/8 inches to 1 1/16 inches); $342 for No. 2 (1 1/16 inches to 1½ inches); $222 for 1½ to 2 inches); $20 for 2 inches to 2 1/8 inches); and $20 for nubs and crooks. The split-planting premium to be paid on deliveries beginning Aug. 8 is now 7.5 per cent up from five per cent previously. The downy mildew reimbursement is now $20 per ton up from $14 per ton. Seed prices have increased to $2.70 per 1,000 up from $2.48 per 1,000. The cucumber prices are up about five per cent over last year, Krueger says. BF