Grape Growers’ Zimmerman says mounting prices are causing problems for grape farmers across the province. “Input costs for grape growers are increasing, and specifically labor costs following the increase to minimum wage,” she explains.
According to a 2017 Minimum Wage Impact Assessment commissioned by the Grape Growers organization, a $15 per hour minimum wage will result in an approximate increase of $507 of labor cost per acre. This can add up for growers of any size, and will probably be passed on, ultimately to consumers.
Formusa, too, is worried about the impact of rising costs. “Our biggest challenge is just controlling our costs,” he says. “To add to that, you have the fluctuation of the exchange rate and the uncertainty of what’s going on down south with potential tariff increases.”
Trade Concerns
As Formusa mentioned, produce businesses throughout the North American supply chain are wary of future trade as the North America Free Trade
Agreement (NAFTA) is renegotiated. Few are willing to predict the outcome, but most are trying to remain hopeful the discussions will lead to fair provisions for all three partners—Canada, the United States, and Mexico.
Originally created to increase the flow of goods between the member nations by reducing or eliminating import tariffs, by all accounts trade has risen exponentially since the agreement was put into force in 1994.
“We’re optimistic NAFTA will coalesce and uncertainty in trade will diminish within the next four to six months,” says Furman. “There’s much drama in this regard, but we need to remember that our economy is intrinsically webbed with our American friends. There’s a common goal and interest in ensuring the flow of goods, in and out, continues to run smoothly between the ‘three amigos.’”
“Eventually agriculture will be affected, but it’s hard to say to what degree,” Davidson remarks. “It’s probably not worth worrying about something if we have no clear picture of what it’s going to be.”
Imports and exports
While Ontario supplies most of Canada with fresh produce, the province is also a major international importer and exporter with trade partners across the globe. Ontario’s top five fresh fruit export destinations are the United States, Costa Rica, Cuba, United Arab Emirates, and Trinidad and Tobago. The province primarily imports fresh fruit from the United States, Mexico, Chile, Costa Rica, and Guatemala.
