Pending July closure of the Spitz sunflower seed plant in Bow Island, announced Feb. 15 by plant owner PepsiCo Inc., came as a shock to its 53 employees and to town and county officials.
By Feb. 22, those officials were following leads to attract another business into the plant and perhaps retain jobs.
Steven Wikkerink, reeve of the County of Forty Mile, said he and Bow Island Mayor Gordon Reynolds have put out feelers to at least one other business that could use the facility to process a different crop.
“They’re kind of ready to move ahead with something and this probably becomes something that’s fairly attractive,” he said.
“If we could get somebody else back in there fairly quick, then PepsiCo doesn’t have to just mothball the place, and we could hopefully get a good percentage of the jobs back.”
Spitz, the sunflower seed brand ubiquitous at ballparks and known for its variety of flavours and resealable packages, was founded in Bow Island in 1982 by southern Alberta farmers Tom and Emmy Droog.
They grew the confectionary brand from initial marketing as birdseed.
The Droogs sold the business to PepsiCo in 2008 in a multi-million dollar deal destined to expand Spitz from 5.4 million kilograms of product per year.
Expand it did. Now PepsiCo wants to grow further and will do so with an existing manufacturing partner in the United States.
“This was a business decision based on an extensive evaluation of the long-term viability of this site and its ability to meet our increasing volume requirements for the brand, which will continue to play an important role in our North American portfolio,” PepsiCo spokesperson Sheri Morgan said in an emailed statement.
“Bow Island is a 30-year-old manufacturing facility and requires significant modernization to maintain our North American product standards and support our long-term Spitz production needs.”
Wikkerink said the Bow Island Spitz plant underwent a major expansion to its shipping area last fall, which seemed to indicate long-term plans. So when the closure announcement came, it was a surprise.
Wikkerink said closure is unlikely to have a major impact on local farmers because most of the raw product came from Manitoba and North Dakota. He speculated that PepsiCo wanted to locate closer to the source of its raw product and economize on shipping.
When the Droogs opened the Bow Island plant, many producers tried the crop and some still grow sunflowers, but the growing season is slightly too short to guarantee good maturity.
“The other challenge that we had growing them here was, sunflowers have the same sclerotinia or mould disease in them that our dry beans in the area do, and so producers that have a fair amount of dry beans already in their rotation, it was really hard to fit the sunflowers in because of the same disease.
“Beans just seemed to be working a lot better so the majority of the guys in our area were opting to grow the beans that they could make work versus a sunflower crop that was always known to be a little bit iffy.”
Darcelle Graham, executive director of the National Sunflower Association of Canada, said PepsiCo sunflower contracts with Manitoba growers will be honored but the delivery point will change to a U.S. location.
She said the association hopes that the company continues to contract Manitoba acres.
“It might be something they’ll consider, just to mitigate weather concerns just in terms of being able to source the product,” said Graham.
“It’s unfortunate to see that they’re not going to remain in Canada but that’s a business decision and we just hope that they remain interested in contracting with Manitoba growers.”
Back in Alberta, Wikkerink said loss of the plant has implications for county taxation, particularly considering the tax base has shrunk in recent years. A federal protection order for sage grouse inhibited gas well activity in the county’s southeast and the downturn in the energy industry caused further reduction.
There are about 3,700 people in the County of Forty Mile and about 2,500 in the town of Bow Island.
“When you have a workforce of 53 people losing their jobs, that’s the real big hit.”
As for the Spitz brand, Morgan said the company is committed to it.