Ontario 2017 Tomato Agreement

Ontario 2017 Tomato Agreement

Weeks after the province made the controversial decision to take over tomato pricing negotiations, an agreement between farmers and processors has been reached for the 2017 growing season.
Former minister of agriculture Elmer Buchanan, who was appointed by the Ontario government to lead negotiations for farmers, said the deal is a continuation of the 2016 pricing contract.
 
According to information released on the OPVG website, Elmer Buchanan stated “an agreement has been reached on 15 March 2017 for the 2017 processing tomato crop with ConAgra Foods Canada Inc., Highbury Canco Corporation and Sun-Brite Foods Inc. The existing M.O.U. signed in 2016 regarding pricing is still in effect and 2016 contract tonnage will be maintained. 
As with any successful negotiations, both sides came to the table and were willing to compromise to reach an agreement. This resulted in a successful deal that will benefit the industry.
I thank all parties for their hard work and look forward with our continued work together as we move ahead with further negotiations.”
 
Farmers are not pleased with the deal, according to tomato grower Francis Dobbelaar, who is also the former chairperson of the Ontario Processing Vegetable Growers board. He said he discussed the agreement with several growers, who describe it as a "horrible" deal.
"They're upset about it," Dobbelaar said, outlining how the deal is excellent for processors and it never would have been approved by the Vegetable Growers board.
"They got a real good deal, probably the best deal in North America," he said.
Minister of Agriculture and Rural Affairs Jeff Leal applauded the deal with three major tomato processors ConAgra Foods Canada Inc., Highbury Canco Corporation and Sun-Brite Foods Inc.
"I appreciate their hard work during the negotiating process to ensure a deal was reached for the parties involved," Leal said.
 

The agreement between Ontario growers and tomato processors for the 2017 growing season is expected to drop the price tomato farmers are paid as their yields increase.
The agreement maintains the contracted tonnage of 2016 and follows the five-year pricing agreement set by growers and processors last year. Final prices, however, have not yet been set, as the Ontario processing tomato price is based on the California Tomato Growers Association price plus Ontario considerations, such as the value of the dollar and productivity.
Though the CTGA price is not yet set (as of 29 March), the productivity section of the Ontario agreement has – and it includes a discount over last year’s price for extra yield.
 
Under the new price adjustment, for each one ton increase in yield, starting at 39 up to 40 tons per measured acre (about 88.5 mT/ha), a discount of 0.5% per ton will apply. For each one ton increase in yield from 40 to 45 tons per measured acre (90 up to 101 mT/ha), the price will be discounted by 1%. Over 45 net tons per measured acre (101 mT/ha), a price discount will apply of 1.5% per ton. The price decreases incrementally as yield increases incrementally.
The formula for productivity has decreased from last year. For example, from 39 to 40 tons last year, there was no decrease, but this year there is a discount of 0.5% per ton. Some slight increases in payment for replants and transplants are now included.
 
Presented below is the 2017 tomato agreement that reflect the changes agreed with ConAgra Foods Canada Inc., with Sun-Brite Foods Inc. and with Highbury Canco Corporation.