Ontario needs to change its produce marketing regulations to help enable that.
Ottawa—Canada could be processing a lot more domestically-produced fruits and vegetables rather than much of produce going to the United States, says Ron Lemaire, President of the Canadian Produce Marketing Association (CPMA).
Currently there is limited domestic produce processing capacity in Canada and fixing that would require greater investment in facilities, especially in Ontario, he told the Commons agriculture committee. Ottawa should implement a series of tax-incentive programs to encourage industry to invest in Canada.
Ontario’s regulated commodity model “has created a disincentive to drive innovation and investment” by restricting the movement of produce into processing channels, he said. That forces Ontario growers to ship their produce to American food companies, which results in them receiving only about 35 per cent of the price, due to the logistics and transportation costs.
Processors that might want to set up or expand in Canada also face severe labour shortages and corporate tax structures. The federal government could help with the labour issue, the high cost of inputs and competition from frozen products coming from overseas.
Fruit and vegetable processors are already short about 30,000 workers and to be viable need access to qualified foreign workers and support for automation and innovation.
Meanwhile growers could produce more for the value-added market such as frozen fruit and vegetables, baby food, juices, shredded lettuce, minimally processed salad kits, mini-carrots, purées and others, Lemaire said. A survey in 2020 found 24 per cent of Canadians indicated that they were planning to spend more on frozen produce in 2021.
“We all recognize that the produce sector functions in an extremely competitive market. As commodity prices and volumes drive the success or failure of our sector, the government should examine short-term and direct supply chain opportunities to support and create market opportunities both domestically and internationally.”
As well, federal and provincial regulations must be reviewed to determine opportunities and gaps being created by the unintended consequences of regulated commodity models and production volumes, he said. COVID-19 “has imposed significant new challenges for businesses throughout our supply chain, including the added costs of purchasing personal protective equipment and other health screening tools and equipment, the implementation of safety protocols to allow for social distancing. It is likely processors will face these rules for foreseeable future.
One processor that is doing well is Sliced, based in Wester Canada, Lemaire said. It has control over its production base and “used state-of-the-art technology in their production and their fresh-cut operations so that they could ensure they were processing the vegetables and the fruit product going through in the most effective manner.”
Alex Binkley is a freelance journalist and writes for domestic and international publications about agriculture, food and transportation issues. He’s also the author of two science fiction novels with more in the works.