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u.s.-canada trade

Burlington, Ont.-based fruit and vegetable producer Ippolito Group is an extensive, cross-border grower-packer-shipper.

Consider that quotidian package of spinach on the produce shelf.

Judge the greenness of the leaf. Decide on its freshness. We take it so much for granted. What you don't see are the cross-border trade issues, high-tech tracking and tightened U.S. immigration enforcement in every leaf.

In the produce business, "We joke around that you never know what you're waking up to," says Steve Dimen, co-chief operating officer of Burlington, Ont.-based fruit and vegetable producer Ippolito Group.

Mother Nature's changing temperament is a given, "whether it's drought, and then you go from that to this year there's been too much rain. Fields have been flooded out, and canals have overflowed.

"We actually had so much rain, we couldn't handle it in a lot of the California areas. And now all of a sudden, you're hearing about the fires throughout California."

What is equally uncertain now is the temperament of trading partners, namely the current American administration bringing Canada and Mexico back to the negotiating table over the North American free-trade agreement and concerns in the produce sector of possible seasonal tariffs. This would create a hurdle for Canadian growers and packers who distribute produce to the U.S. during Canada's growing season.

"I wish I could say it went like clockwork. Every day is a new day," Mr. Dimen says.

Ippolito has grown alongside the increased complexities of food politics and logistics. It began as a mom-and-pop produce wholesaler in Hamilton during the Depression era. By the 1960s, it had moved into a larger facility, with packaged spinach being one of its main lines of business. It makes the Queen Victoria brand of packaged spinach and salad products. Other major products include Brussels sprouts, leeks and asparagus.

By the late 1990s and early 2000s, it had become an extensive, cross-border enterprise.

It now grows a large amount of its produce in California and Arizona. Some is also grown elsewhere in North America, including in Ontario and Quebec when in season. Ippolito then ships much of that to Burlington for processing, while also doing some of its packaging and prepping in the States.

"Ippolito doesn't actually own any farms in Ontario. We just have growing partners who we've worked with for generations, and many of them grow just for Ippolito. For example, we have a growing partner in Orangeville that grows about 700 acres of spinach for us," Mr. Dimen says.

The company then ships the produce via its own trucking company, making Ippolito what the industry calls a grower-packer-shipper, all in one. This helps eliminate some uncertainties, such as not enough year-round crops or, say, a third-party trucking company failing to show up when a perishable produce shipment is ready for delivery.

But talk of potential seasonal tariffs are a danger. "That's been bounced around lately, and that would obviously have a large impact on the Canadian market place," Mr. Dimen says.

Currently, there are anti-dumping measures requiring appropriate data to resolve a dispute if, say, U.S. growers felt that Canada was importing too much spinach during its growing season. A seasonality tariff would be easier for the U.S. to impose, says Ron Lemaire, president of the Canadian Produce Marketing Association, "and it would make it perhaps too easy to apply a duty that may not be factual."

The produce association and the companies it represents "are not in favour of any model that would reintroduce any tariffs or changes to the countervailing or anti-dumping model that we current operate within," he says.

This is all occurring at a time when cross-border logistics and shipment tracking technology have leapt ahead in speed and ease, with the use of newer electronic tracking and documentation. "We see very little physical delay with the trucks at the border," says Ted Russon, operations manager of Ippolito Transportation.

"The truck can not proceed to the border unless it is cleared before it gets there. So, you have to have all of your paperwork in order. It has to be accepted not only by the broker [that is, the middle man between grower and grocer], but by Canada and U.S. customs before the truck can proceed to the border point. Technology has really helped us there," Mr. Russon says.

New technology can also track produce throughout its entire shipment. This include records of the temperature in which the produce was stored throughout its journey. "You can get live updates on a truck that's on the road for five days from California. You can look at any point in time and tell what the temperature of the trailer is," Mr. Dimen says.

This level of technology is simply how the produce sector now operates, says the produce association's Mr. Lemaire.

"The only way you can maintain a cost centre that Canadians are looking for is by adopting it [the technology and efficiencies]. And as more adopt it, the cost drops," he says.

Then there is the continual shortage of labour where labour is needed most, in the more southern parts of the United States. Tighter enforcement of Mexican workers' credentials is not helping to ease the shortage in the industry, and adds a level of potential hurdles.

"Obviously there's a heightened sense of security down there with U.S. border patrol, with border stops on the highway. You do have that," Mr. Dimen says. "I've been there quite a few times when they've literally set up a roadblock on the highway, and they are checking for papers."

He added: "I wouldn't say it's disruptive at this point in time. It's just more steps in the process."

The industry, though, is still, at heart, about crops and fields, dirt and soil. Yet now climate change is another dramatic way in which the produce business is altering. "Even here in Southern Ontario, the weather patterns in our eyes have definitely been changing over the years," Mr. Dimen says, noting the severity of storms in recent memory. "We've noticed over the years the amount of storms – and larger storms – have really increased."

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