The British Columbia fruit industry is facing a major crisis as the BC Tree Fruits Cooperative has officially filed for creditor protection. Premier David Eby has announced millions in additional funding to support the struggling industry, which has been hit hard by a series of challenges, including severe weather and financial difficulties.
The co-operative, which has been providing storage and packing services for farmers for almost a century, is now in a precarious position with more than $58 million in liabilities. The petition filed in B.C. Supreme Court shows that the co-op received a repayment notice last week related to over $50 million in debts to the Canadian Imperial Bank of Canada. The co-op is now “non-compliant” with the loan agreements to CIBC, leading to the decision to file for creditor protection.
The recent severe weather patterns in British Columbia have further exacerbated the situation for the fruit industry. The petition states that the stone fruit crops were damaged by unusually severe weather this year, resulting in a significant reduction in harvest volumes. Cherries saw an 85 to 90 percent reduction in volume, while all other stone fruit harvests were reduced to zero. This unexpected crop reduction was the final tipping point for the already struggling BC Tree Fruits Cooperative.
In response to the crisis, the province is closely monitoring the creditor protection process to ensure that key assets are protected and that services for farmers can continue. Premier David Eby and Agriculture Minister Pam Alexis held a news conference in Penticton to announce supports for farmers and discuss the ongoing efforts to assist growers during this challenging time.
The BC Tree Fruits Cooperative had been facing challenges for many years, including governance issues and significant debt. The decision to wind up operations was not taken lightly, and efforts are being made to maximize recovery for all stakeholders. The co-op and its subsidiaries had over $111 million in assets as of last year, but also had more than $58 million in liabilities, including debts to CIBC and amounts owing to growers and other creditors.
The hearing in B.C. Supreme Court will determine the next steps for the BC Tree Fruits Cooperative, including the approval of interim financing and a comeback hearing on August 23. The co-op is seeking a stay of proceedings and remedies to address the financial crisis it is facing. The industry is looking towards finding solutions to support growers and ensure the sustainability of the fruit industry in British Columbia.