Little more than a month ago, Ontario premier and agriculture minister Kathleen Wynne issued a bold challenge to Ontario’s agriculture and food industry.
“I’m challenging Ontario’s agri-food industry to double its growth rate and create more than 120,000 jobs by 2020,” she told a Toronto food summit.
“I’ve always believed in the enormous potential of this sector.”
Well, make that goal 120,740 new jobs.
Last week, H.J. Heinz Co., now owned by Brazilian and American investors, announced it will close its 100-year-old ketchup plant in Leamington, Ont., next year, throwing 740 plant employees out of work in a town of 12,000.
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Fifty farmers in this southwestern Ontario area will be forced to look at growing lower-return crops. They now have sales of more than $1 million a year and are dependent on Heinz to buy their tomato production.
It is a blow for the community, for the farm community and for the Ontario Liberal government’s dreams of a food industry revival.
It is also a setback for the province’s food processing sector, which has been hollowed out over the past decade as Ontario lost its status as Canada’s largest agricultural province.
“It clearly is a setback, but we are still the No. 1 industry in the province,” Ontario Federation of Agriculture president Mark Wales said.He was raised in the Leamington area, and his parents both worked for Heinz in the 1940s.
“For sure it is a kick in the shins for the government goal for industry expansion,” he said.
“This is one of the things that happens when you don’t have head offices in the country. They have no loyalty beyond the bottom line.”
That’s the kicker.
Ontario’s food processing industry is largely the victim of international market forces.
Foreign owners will move production to where wages are lower (not Ontario), a strong Canadian dollar has diminished competitiveness in export markets and labour shortages often plague the Ontario industry, despite the fact that thousands of seasonal workers lose their jobs with plant closings. As well, the weakening or end of marketing boards has left farmers with almost no power in this high-stakes market chess game.
International capitalism calls the shots.
The irony of the Heinz closing is that one of the buyers of the iconic company is American billionaire capitalist nice guy Warren Buffett, who regularly laments the growing gap between the rich and poor. Tell that to 740 unemployed workers.
Local, provincial and federal governments have little control over capital movements or far-away owners.
Wales insists that the provincial government can pursue its industry expansion goals with incentives for processors.
“It’s vital the Ontario agri-food industry work with government to develop a strategy for domestic food processing so Ontario agriculture and food production continues to thrive, drive economic activity and meet premier Wynne’s challenge to increase growth,” he said in a statement after the Heinz announcement
However, that horse seems to have left the barn.
Government actions to support industry are often subject to trade challenge, and governments are tending to shy away from intervention.
Consider the Heinz announcement a harbinger for the continued decline of Canada’s food processing industry.
