Monday, November 30, 2015

Tribunal considers integrated tomato processing

The tribunal is pondering what to do about an application to establish the first integrated tomato growing and processing business, a joint venture of Art Brouwer and his Eau Farms Ltd. and Highbury-Canco Corp.

The Ontario Processing Vegetable Growers Marketing Board has turned down an application from their joint venture, called Integrated Farming Ltd., to grow about eight tonnes of tomatoes next summer.

It sees the joint venture as a ploy to reduce the cost of tomatoes for Highbury-Canco.

But Highbury-Canco president Sam Diab testified Monday that the reason is to explore new marketing ventures that will increase sales, mainly by exploiting survey findings that consumers prefer made in Canada tomato products with the tomatoes coming direct from local farms to their store shelves.

He said this is separate from another Highbury-Canco goal of pursuing large-volume sales of tomato paste, both in Canada for export. As part of that goal, Highbury-Canco has been asking the marketing board and the Ontario Farm Products Marketing Commission to approve creation of a fourth pricing category for processing tomatoes at $12 to $15 per tonne below the prevailing contract prices.

But the board thinks the joint venture proposal is simply another Highbury-Casco attempt to get a lower price for tomatoes and it’s for that reason alone that it rejected the application for a licence to grow next summer.

The tomato paste proposal is still under discussion among the Ontario Farm Products Marketing Commission, Highbury-Canco and the marketing board. Their next meeting is Friday.

Under close questioning from two members of the panel for the Ontario Agriculture, Food and Rural Affairs Appeals Tribunal – Marthanne Robson and Arnold Strub - the marketing board’s general manager John Mumford said the board assumes that Highbury would use its share of profits from the joint venture company to lower its cost of procuring tomatoes.

Strub noted that Integrated Farming Limited could use its profits any way it chooses, and not just to lower tomato prices.

Robson learned from Mumford that the board has no objection to a joint processor-producer venture if it’s a sole owner, not a partnership. Thus Lakeview Vegetable Processing grows and processes carrots, but the profits are all stay with the sole owner.

DeBrouwer testified that the joint venture is “a deal made in heaven” and that he was immediately enthused when he was approached by Diab in January.

His benefits are reduced risks, lower costs for bulk-purchased inputs such as trucking, fertilizers and pesticides and a greater likelihood that he will be able to expand production.

Diab said Highbury benefits by learning much more about the details involved in growing tomatoes and by providing services such as currency hedging. He said it also gives Highbury a legitimate reason to advertise that its tomato products come directly from its fields to customers.

Mumford said under questioning by Strub that he believes many other vegetable processing companies are watching this venture closely, especially if they think it presents a way to lower crop input costs.

That could, he said, undermine the entire structure of orderly marketing for the processing-vegetable industry.

Highbury-Canco was formed in 2014 to take over the Heinz tomato ketchup facilities in Leamington. It was one of five plants Heinz closed and Mumford said it was a closure the board anticipated, yet was surprised by the timing.

Heinz helped Highbury establish itself, including provision of a letter of credit so it could qualify for a processor licence from the marketing board.

Highbury contracted with 10 growers, each with an equal share, for the 2015 crop.

When the board refused to licence Integrated Farming Limited to grow tomatoes this year, it was left with 2.5 million plants and so contracted with Bert DeBrouwer, an uncle of Art DeBrouwer, and three other extended-family members and companies to plant the seedlings.

Diab said he did not contract with Art DeBrouwer’s Eau Farms Ltd., the joint-venture partner in Integrated Farming Limited, because the board was suggesting that Highbury-Casco could contract for its needs with Eau Farms and didn’t need to establish Integrated Farming Ltd.

Diab said he objected to the board telling him with whom he should contract. DeBrouwer said he had hoped that he would get the contract, but didn’t know the reason for Highbury’s choice of his uncle, nor did he ask.

The tribunal is likely to issue a decision before the end of the year.

Wednesday, November 25, 2015

Maple Leaf laying off 400

Maple Leaf Foods laying off 400 salaried employees, most of them before the end of the year.

President and chief executive Michael McCain said the staff can be trimmed now that major transitions have been completed, including closure of a number of meat-processing facilities to consolidate them in a new plant at Hamilton.

McCain said the focus now will be on cutting costs.

I guess he needs every penny he can squeeze out of the business to pay his ex-wife's record-breaking alimony judgement.

The company says “people affected will be treated fairly and respectfully, consistent with the company's values and history in implementing organizational change.”

Slow cooking meat is better

The slow-cooking movement is getting a boost from new research that indicates it’s high-temperature barbequing and pan-frying meat that poses a risk of cancer.

I guess that means I can tell my wife I'm not going to barbecue any more. Good luck with that!

Cooking meat at a lower temperature may reduce the risk of creating chemical compounds that could be carcinogenic,  says a team of researchers at the University of Texas. Their findings are published this month in the latest issue of t he scientific journal Cancer.

Earlier this month the World Health Organization said processed meats are carcinogenic and fresh red meat are probably carcinogenic, particularly when they are barbecued or pan-fried.

The new study, conducted by scientists at the MD Anderson Cancer Center at the University of Texas, concluded that cooking techniques such as barbecuing and pan-frying are known to result in the formation of carcinogens that can increase the risk of renal cell carcinoma (RCC), and some people have certain genetic mutations that make them more susceptible to the harmful compounds.

Einwechter fined $70,00 in worker death

Einwechter Ltd. has been fined $70,000 in the death of a 30-year veteran employee who suffocated in a bin of soybeans in March, 2014.

President Jim Einwechter entered a guilty plea in Kitchener court this week and expressed remorse for the death.

Justice Gary Hearn noted that the company has workplace safety policies and procedures, but they were not followed after Gary Rush, who was in charge of the grain elevator near New Dundee, climbed in to fix a jam.

The augur was shut down and he told employees to turn it back on in about 10 minutes. They did, but an hour later noticed that Hearn was missing.

It took from 5 p.m. to 1 a.m. and help from emergency crews to find him, his leg caught in the augur and dead from asphyxiation.

Einwechter’s lawyer said he is “extremely remorseful”.

Justice Hearn said the victim impact statements from Rush’s wife and two children, who were in court, “are extremely thoughtful and compelling.”

At the family’s request, their victim impact statements were not read out in court. Hearn said “I appreciate (that) your loss is great.”

Prosecutor Dale Ives said there is nothing in this situation to suggest that the company, which employs nine people, was wilfully negligent.

The company was set up in 1937 to haul livestock and grain. The Einwechters’ extended family includes the founder of Challenger Freight, one of the largest trucking companies in the province.

Cronins win outstanding farmer award

Mike and Amy Cronin of Bluevale are joint winners of the national award as Canada’s best young farmers.

They share the award with Patrick and Cherylynn Bos of Alberta.

Amy is chairman of the Ontario Pork Producers Marketing Board.

She and Mike both grew up on dairy farms, but now run an international operation that has 17,000 sows in barns in Ontario and the United States.

They built the first crate-free farrowing system in North America in 2014.

Patrick and Cherylynn Bos operate a herd of 1,400 dairy goats in Alberta and have their own cow and goat-milk and cheese processing business called Rock Ridge Dairy.