Mushroom farmers face steep COVID-19 losses

Farmers urge Ottawa to establish emergency fund to help them weather the restaurant closures forced by the pandemic

Canadian mushroom farmers say the COVID-19 pandemic has been devastating for many operations, with losses totalling $6.5 million.

In a letter addressing Prime Minister Justin Trudeau and federal ministers last week, Mushrooms Canada wrote that the industry will face losses of an additional $400,000 for every week the economy remains stagnant.

It said mushroom farms are experiencing production losses of 30 to 50 percent. Operations that largely supply the food service industry, such as restaurants, are experiencing heavier losses than those who mostly supply retailers.

“Every week is challenging,” said Mike Medeiros, co-owner of Carleton Mushroom Farm Sales in Osgoode, Ont.

Medeiros, who is also a board member with Mushrooms Canada, said the operation has experienced production losses of 35 percent because of restaurant and food business closures.

He said the company has managed to divert some production to retail, but it’s been a challenge. For instance, the assembly line is slower because of physical distancing, and newly hired employees need time for training.

As well, it’s difficult to meet retailers’ smaller packaging requirements. It’s easier to sell in bulk to food service companies, he said.

“We’ve lost 20 full-time and part-time staff who have opted to stay home,” Medeiros said. “We’ve hired people, but we have to train them. It has been frustrating.”

“We’ve lost 20 full-time and part-time staff who have opted to stay home. We’ve hired people, but we have to train them. It has been frustrating.” – Mike Medeiros | Carleton Mushroom Farm Sales photo

Garth Mclean, vice-president of marketing and sales with Farmers’ Fresh Mushrooms in Abbotsford, B.C., said food service sales are down 70 percent, though retail sales have increased by 15 to 25 percent.

He said the company has reduced production slightly.

“It’s been a daily adjustment,” he said. “It’s better now because things have calmed down, but the first couple of weeks was a real roller coaster.”

He speculated there might be a shortage of mushrooms in the fall if things return to normal then. The situation might force smaller farms to close given the financial constraints, he said.

At Carleton, Medeiros said the company has had to reduce production.

He said companies that rely on temporary foreign workers have had to increase costs.

They are spending more on hotel rooms, for example, to ensure workers are physically distant. Only a certain number of people can live in one home.

As well, farmers are paying more for transportation services, he said. Buses are now carrying fewer workers than before.

The federal government has introduced a program to help farmers pay for quarantine costs when temporary foreign workers arrive. The problem, Medeiros said, is the program doesn’t cover the extra costs after the quarantine program ends.

“We need support for everyone in the agriculture industry,” he said. “Farmers need labour and business risk management help. We’ve been asking for it and the government is neglecting it.”

The federal government has introduced a program that lets farmers defer interest payments and access additional lines of credit, but farm organizations want actions to go a step further.

The Canadian Federation of Agriculture (CFA) is requesting the government establish a $2.6 billion emergency fund for agriculture.

Mary Robinson, president of the CFA, said farmers need financial assurances that they won’t face bankruptcies.

She has said previously the food supply chain could collapse without financial help.

“We’ve been watching our government announce new assistance for many other sectors almost daily since the pandemic began, and farmers are appalled as they watch an essential service and critical infrastructure, such as food production and processing, being largely ignored,” Robinson said in a news release on April 30.

In its letter, Mushrooms Canada said farmers don’t qualify for the various government programs.

It said emergency funding is required to help farmers during the financially difficult time. As well, it wants a working group established to promote Canadian food products at grocery stores; an immigration, refugee and citizen liaison to work with producers to help with temporary foreign workers; and a carbon tax exemption so farmers can be competitive with the United States.

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