The Ford government is reviewing Canada’s $3-billion food terminal — and independent grocers are worried

The Ford government is reviewing Canada’s $3-billion food terminal — and independent grocers are worried

As Steve Bamford walks through the crowded halls of the Ontario Food Terminal, his first concern is keeping visitors out of harm’s way.

“Watch it. They move pretty fast,” said Bamford as a cart stacked high with cases of tomatoes gets wheeled down a central pathway in the massive Etobicoke warehouse complex.

But these days, Bamford is even more concerned about the future of the terminal, which sees more than $ 3 billion of wholesale produce pass through every year, making it the biggest fruit, vegetable and flower market in Canada, and the third biggest by sales in North America, after Los Angeles and New York.

Established in 1954 as an alternative to the crowded, often-chaotic area around the St. Lawrence Market and the Esplanade, the terminal brings together wholesalers, farmers, and retailers ranging from corner stores to smaller, independent chains such as Longo’s and Rabba. (Larger chains, such as Loblaws, have their own distribution networks and typically don’t use the terminal.)

In the 343-page provincial budget released April 11, there were two short paragraphs announcing that the Ontario government would be conducting a review of the terminal, which it owns. That caught the attention of Bamford, other wholesalers and hundreds of farmers who sell their wares at the market, many of whom fear the provincial government could be looking to sell or move the market, or break it up into smaller regional centres. Any of those moves, they say, could hurt farmers, wholesalers and independent grocery stores. It could also, they add, end up meaning higher prices for consumers.

The worst-case scenario, suggested John Russell, president of wholesaler J.E. Russell produce, would be seeing the terminal land sold off, with no centralized replacement for smaller retailers to buy their produce straight from farmers and wholesalers.

“That would mean the death of independent retailers in eastern Canada,” said Russell. “Having the terminal here, with everybody in one place, allows them the opportunity to compete on price with the big chains.”

At Vaughan-based retail chain Longo’s, up to 70 per cent of the produce on the shelves comes from the terminal, says vice president Mike Longo. Having access to all of the wholesalers and farmers at once helps give retailers access to better quality and keeps prices lower, Longo said.

“If you didn’t have it consolidated, you wouldn’t have the same level of competition, and prices would go up. That would definitely have an impact on the consumer,” said Longo. “It would hurt the smaller independents, which are what make this such a great, interesting city.”

In an email to the Star, provincial agriculture minister Ernie Hardeman stressed that the government hasn’t made any decisions, and would be consulting with the terminal’s tenants and customers.

“The government is looking at opportunities to make it even better and ensure its long-term success,” wrote Hardeman, who also mentioned the possibility of greater use of technology, and possible expansion.

Still, asked specifically about whether he’d rule out the terminal being sold to a private operator who might raise rents, or the land being sold to a developer, Hardeman was noncommittal.

“We are just beginning consultations on how we can ensure the long-term success of the Food Terminal. Our goal is to ensure that we have a Food Terminal that will be strong and successful 5, 10 and 50 years down the road,” Hardeman wrote.

While the government says it’s committed to a strong and successful terminal, it also reiterated in the budget that it plans to sell off real estate which is “no longer needed to deliver government programs, generate revenue and save taxpayers’ dollars.”

Malcolm Bird, a University of Winnipeg political scientist who has studied the terminal, strongly suspects the terminal is something the government would like to sell.

“Somebody thinks they can monetize this asset,” said Bird, whose masters thesis at York University was on the history of the terminal. It is more than likely not the first time a provincial government has taken a run at potentially selling the terminal, Bird suggested. But anyone who tries to do it would face plenty of opposition.

“They’ll get blowback from farmers. They’ll certainly get blowback from the wholesalers, who have invested millions of dollars in their units,” said Bird.

If that monetization means selling it off, the 40 acres of land the terminal sits on would be a prime target for developers, said Avi Behar, president of Behar Group Realty. Already, the terminal is virtually surrounded by condo towers. He estimates the land could fetch anywhere between $ 1 million and $ 5 million per acre in a sale, for a total value of up to $ 200 million, and it could easily be turned into a mixed use development including more condos, some retail shops and even some office towers.

“It’s a very desirable location. It’s close to transit. It’s right by the lake. And there’s much more intensification in that area, and there are more services,” said Behar.

Moving or changing the terminal would be one thing. But breaking it up into smaller centres or getting rid of it entirely is something Lorenzo Scala — owner of the Tomato King wholesaler — hopes never happens.

“If it disappears, what happens to the small businesses who buy here, and the farmers who sell here? Is that what we’re all about in Ontario? If it ever came, it would be a sad day.”

TORONTO STAR

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