Ketchup war has Ontario farmers upping tomato production
Newest ketchup producer, Primo, hopes to create even more demand for tomatoes
Several Essex County farmers and food processors in southwestern Ontario are reaping the benefits of the ongoing ketchup war, sparked last month, not long after food giant French's squeezed its way into the ketchup market.
Canadian consumers spoke out on social media and took action with their loonies by supporting French's new ketchup brand because the American company sources tomatoes grown in Leamington, Ont.
That patriotic response then nudged Canadian-owned Primo Foods to finally dive headfirst into the market with its own product just last week.
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With more companies, big and small, salivating to get their hands on tomatoes grown in agriculturally rich southwestern Ontario, farmers in the region are approaching production levels not seen since Heinz uprooted its Leamington processing plant and moved to the U.S. back in 2014.
When Heinz left, Leamington farmer Dave Epp had to increase production of beans, peas and sweet corn to make a living. But his family is back in the tomato business after signing contracts with two local processors this past year.
"It means the tomato industry is viable again from a farm perspective," he said of the increasing demand for Canadian tomatoes.
Return of the tomato
Epp dusted off his old equipment and once again produced 100 acres of tomatoes last year thanks to a contract with Thomas Canning, another Essex County company that recently delved into tomato paste production. It, like Highbury Canco in Leamington, makes paste used in French's ketchup.
Epp hopes to renew that contract again this year. In the meantime, though, he's just secured a second 100-acre deal with Highbury Canco, the company that took over the Heinz plant and has been growing its tomato paste production — and workforce — ever since.
When Heinz left in 2014, it put nearly 1,000 full-time and part-time employees out of work. Highbury Canco now employs 400.
Tom Keller of Triple K Farms recently landed a deal with Highbury Canco as well. Another victim of the Heinz transplant, he also turned to other vegetable crops.
But, thanks to Canadians wanting to support local growers, he, too, is getting back to growing tomatoes, which is a much more profitable crop.
"It's great that people are willing to support us in Ontario," he told CBC News. "I can make the farm more financially viable."
Props to the processors
Sun-Brite Foods, the parent company of Primo, could also need more tomatoes now that it has dipped its fingers in the ketchup market. If its latest all-Canadian brand of ketchup is a hit, Sun-Brite president Henry Iacobelli said the company could increase production by 50,000 tonnes of tomatoes per year.
Sun-Brite says its tomatoes, labour and packaging are all from Ontario.
His Kingsville facility already contracts about 186,000 tonnes of tomatoes annually. The increase would mean working with seven or eight more growers and adding five to 10 more employees.
"If the demand was there next year and the year after, we could turn around and pack that much," Iacobelli said.
Thomas Canning owner Bill Thomas does not expect to increase tomato processing this year, but that could quickly change as American companies like French's realize the benefits of using tomato paste made in Canada.
Both Thomas and Iacobelli recognize the driving force behind the latest increase in product demand.
"The strength of this whole thing isn't me and it's not French's, it's the consumer," Thomas said. "And I hope the pressure stays on it because it can mean a lot to our community just by going to the store and buying the product."
Building a Canadian brand
The growth in demand for locally grown tomatoes could create an opportunity for Canada to stake a claim in the global production of tomato paste, say growers and processors.
Any Canadian company making tomato paste typically has a difficult time keeping up with other regions, particularly in California, where overhead costs are lower, explained Thomas. Because of the mass production in the Golden State, producers often influence pricing around the world.
"There are some costs here that we have that are higher than what they are in other jurisdictions," Thomas said. "As such, that makes us have to sharpen our pencil pretty good in order to compete in that market. So, the product-of-Canada thing is a bonus for us."
Ontario's tomato industry is poised for success for several reasons, explained Epp, who was the director of the Ontario Processing Vegetable Growers for 15 years. In addition to the Canadian dollar, he applauds farmers and processors for creating a competitive market.
"The industry has has bounced back and the system is doing just fine," he said.