The start of the Ontario asparagus season has brought abundant and high quality supply. Growing conditions have been excellent and, more importantly, the weather during last year's fall season set up the crop perfectly. On a production level, things are looking great.
"Mother Nature was very kind to asparagus growers last year in providing perfect conditions," said Peter Streef of Streef Produce. "Last year's Fall was one of the best we've ever had. The crowns were fed by plenty of moisture and there was no disease pressure, resulting in a super healthy crop. At the end of April into the beginning of May, cold temperatures temporarily slowed the crop, but since then, we've experienced much warmer weather. This caused a big push in the crowns, not just in Ontario, but all over Canada and the US, resulting in heavy duty volumes all across North America."
Market excessively low and growers are leaving product out
The excellent conditions, however, have masked some serious issues facing asparagus growers in Ontario. Growers have likened it to a "perfect storm", where sensational growing conditions have combined with significant downward pressure on the market, at the same time that costs are rising steeply. The market is extremely low because of the abundant supply, to the point where suppliers are saying that everyone is making a loss.
"There is a surplus of asparagus in the market and no one is making any money," Streef said. "If you see asparagus at $1.99, it means that both growers and retailers are losing out, because costs are not below $2.00. It's a very serious situation and there is excellent quality product being left out in the fields. Other growers are just dumping volume onto the market, hoping to get some kind of return. The reality is that fuel has gone up 35 percent this past year, and wages have risen by 30 percent. And now we are stalling because we are not moving any volume."
Ontario's wage reforms hitting small scale farmers
One of the biggest impacts on profitability, according to Streef, is the Ontario government's legislation of a rise in the minimum wage. He points out that it's not the minimum wage itself, but it is in the manner it was introduced, as well as a lack of vision towards the position of Ontario growers in the broader market.
"By lifting the minimum wage, the Ontario government has contributed in taking us out of the market place," Streef observed. "We understand and appreciate that people deserve to be paid fairly and appropriately for their work, but the rise has come so quickly and so steeply that it has given companies very little time to adjust. Another problem is that there are only a handful of provinces that have legislated this increase, so not only are we competing with other countries, but also other Canadian provinces. It has disrupted the market because now costs are too high for us to compete with these other regions. It will only result in companies amalgamating, creating larger corporations, and squeezing the local family farms out. It really needs to be rationalized and introduced more fairly and with local business in mind."
For more information:
Peter Streef
Streef Produce
Tel: +1 (416) 251-6885