B.C. Tree Fruits Cooperative files for creditor protection

A group that has provided storage and packing services for British Columbia fruit growers for almost 90 years has filed for creditor protection after receiving a bank repayment notice.

A statement from the B.C. Tree Fruits Cooperative issued Monday says the decision to file for creditor protection stems from the group's "liquidity crisis," with stone fruit crops damaged by weather identified as "the final tipping point" in a series of factors.

The co-operative announced last month that it was shutting down due to "extremely low" estimated fruit volumes, and "difficult market and financial conditions."

It says the group received a notice from the Canadian Imperial Bank of Commerce last Tuesday demanding repayment of debt, then filed for creditor protection in B.C. Supreme Court on Monday in an effort to "maximize recovery for all stakeholders."

A hearing is scheduled in Vancouver on Tuesday, and the group says it's seeking a stay of all proceedings against the co-operative for 10 days, the appointment of a monitor, approval of interim financing, and the scheduling of a subsequent hearing.

WATCH | Kelowna farmer laments loss of B.C. Tree Fruits co-operative:

'Devastating': Kelowna farmer laments loss of B.C. Tree Fruits co-operative

4 months ago

Duration 10:19

Jennifer Deol of There and Back Again Farms had to remove peach trees from her Okanagan farm after a cold snap all but destroyed the stone fruit harvest in the region. Now, she says the region's farmers are reeling from the shutdown of the Tree Fruits co-operative.

An extreme cold spell in January wiped out almost all of B.C.'s peaches, apricots and nectarines for the year and severely damaged cherry orchards. 

Fruit-growing regions of the southern Interior saw several days of frigid temperatures that killed off active buds in trees that had only just begun to recover from the 2021 heat dome and had gone through a harsh winter in 2022.

Former board member alleges power struggle

A former co-operative board member said the board's decision to close the business was made amid a power struggle for control and member discontent over its management. 

Amarjit Lalli, an apple grower in the Okanagan, said Tuesday that the co-op's board "didn't want to give up control of the organization" at a special general meeting, so they decided to shut the organization down instead.

Lalli said some apple growers were so disenchanted with the board that they didn't provide crop estimates to the co-op last month because they felt "the company was being mismanaged and their fruit was mishandled last year," and some had switched to private fruit packers.

"It's been mismanaged and the overhead is way too high. So the margin that we have is quite small, whereas with the private packers, what happens is they're getting relatively the same price as we are and in some cases more, but their overhead is quite low, so their margins are quite a bit higher and that's why they're thriving." 

Lawyers and representatives for the co-operative did not immediately respond to requests for comment.

Assistance for fruit farmers

On Tuesday, the province announced a variety of programs to assist farmers across the province whose businesses have been ravaged by natural disasters and other difficult circumstances for several consecutive years.

Premier David Eby said he's asked the federal government for subsidy frameworks taking place in Washington state, where the federal and state governments are heavily subsidizing their farmers. He also says that farmers are at the whims of "profiteering" grocery retailers.

"Our farmers are expected to compete on what's been called a level playing field … when it's clearly not a level playing field," he said. "One group of farmers is being subsidized, and one isn't. If there's a level playing field, our farmers can compete with the best in the world."

The provincial AgriStability fund will be improved, increasing compensation from 80 to 90 per cent, as well as doubling the cap for the 2024 growing season, said Eby.

"Our estimates are that this will amount to about a $15 million direct payment to farmers to support them with their immediate costs and compensation claims related to loss of crops," he said.

"We are putting in place an additional $5 million tree fruit climate resiliency program, which centres around technologies that are needed to prevent crop loss due to climate events."

This would include things like crop covers and fans, he said.

There will be an exemption to the tree fruit sector so that crops this year can be picked, processed and stored to minimize losses related to the closure of the co-op, he added.

Farmers can also receive advanced payment and have 75 per cent of their anticipated final claim in as little as 15 business days, Agriculture and Food Minister Pam Alexis said.

Farmers can apply for supports for the 2024 season until April 2025.

The province has also worked with private packers and other stakeholders to ensure tree fruit growers can complete this year's harvest, she said.

Over 60,000 bins of fruit will be shipped to other packing houses, according to the province.

Jennifer Deol, the co-owner of There and Back Again Farms in Kelowna, said she was appreciative of the premier and the minister making time to talk to farmers — but said the measures fell short of helping her in her time of need.

"I'm having a really hard time understanding how this is going to help a co-operative farmer like me, with the shutting down of the B.C. Tree Fruit Cooperative, get access to bins now, get access to storage, the food safety, all of that that comes with farming," she told CBC's On The Coast.

Deol said many of the grants announced by the province on Tuesday go to larger farmers, and smaller farmers like her will be left in the lurch and may have to turn to private packers — an idea she finds "ludicrous," saying private packers were one of the reasons the co-operative went under.

On The Coast8:00New measures announced for B.C. farmers

Guest host Belle Puri checks back in with There and Back Again Farms owner Jennifer Deol about whether the supports announced by B.C. will be beneficial enough for small family farmers, and what measures she hopes to see soon.

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