City officials in Kingston, Ont., fear Chobani is scrapping
plans to build a 947,000-square-foot plant to manufacture its Greek yogourt
here.
The city’s economic development officer, Jeff Garrah, says that
after two years of trying, Chobani is stymied by Canada’s supply-management
system.
Earlier this year Chobani won a court challenge filed by
competitors trying to cancel the lower tariff rate Canadian authorities granted
for its products made in New York State for test marketing in Canada, mainly
with Loblaws, the largest supermarket company.
Meanwhile Chobani opened another new 950,000-square-foot
plant in Idaho. The plans for Idaho and Canada were announced at the same time
two years ago.
The Idaho plant has capacity to produce 4.2 million cases
per week. Idaho is, coincidentally, rapidly expanding milk production both
through new dairy farms and expansions of existing ones.
Ontario’s milk production has been stalled and existing
dairies, represented by the Ontario Dairy Council, have fought the entry of any
competitors. The Ontario government and the farmers’ marketing board have,
however, been supportive of Chobani and other newcomers.
There has always been a question of whether, under supply
management, there would be enough milk to service a large Chobani plant. There
is also considerable rivalry between Ontario and Quebec, the two adjacent and dominant
dairy-producing provinces in Canada.
