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How climate change is costing you in the vegetable aisle

Oppenheimer CEO John Anderson on Peruvian rains, California snowfall and why hurricanes drive up the cost of trucking


 
A still life of food. (Photograph by Liam Mogan)

(Photograph by Liam Mogan)

Founded in 1858, the Oppenheimer Group is one of North America’s largest importers of fresh fruits and vegetables, operating in 27 countries (many know it by its nickname, Oppy). John Anderson joined the company 43 years ago, working his way up from warehouse staffer to president and CEO. The position has given him unique insight into weather, climate shifts and extreme events that affect the supply of food in locations through North, Central and South America. While Anderson doesn’t pretend to be a climatologist, his recent experience with extreme weather suggests things are getting worse. He spoke recently with Maclean’s writer Michael Friscolanti.


Q: How is climate change affecting your business?

A: I wouldn’t go out and call it global warming; I would call it climate change. We have seen a lot of shifts in weather and I have to be honest with you: most of the events we see are not warmer but colder weather, and rainier weather in areas where you normally don’t get that. I would say we’re seeing more events that are impacting our crops around the world than what we’ve seen in the past.

Q: Colder temperatures and rainier weather may not be what many people assume when they think of climate change.

A: Because we’re in so many countries and have so many products, we will see a climate event here and there. But over the last year, I think we saw one everywhere—and mostly to do with either hail or rain or cold. We saw the odd one where it was drier than normal or warmer than normal and the crops came earlier. That happened in Chile, for example, and then Peru turned around and got really rainy and cold. We had those extremes.

Q: Can you provide some specific examples? What types of weather events did you deal with this year?

A: In B.C., for example, we’re in the greenhouse business in a big way. It was pretty wet and cold here last year and we had lots of snow, so therefore it pushed off the start of some of our greenhouse crops by about three to four weeks. So that affects your ability to take care of your customers in the marketplace. And during the wintertime, we would get products out of Mexico, and Mexico had cold and wet weather as well. We ended up with a 20 to 25 per cent less crop yield that we were able to harvest and sell to customers.

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Q: Other examples?

A: We have greenhouse operations in California, and the same thing: they had lots of cold weather and snow in the mountains of California. We got hit pretty hard with the berry crops in California because we had the second-wettest winter ever recorded in California, after all the droughts we had. All three regions in California—northern, middle and south—all kind of collided together at the same time in terms of production. And then we had a heavy rain on top of it all, so we had an abundance of extra crop that was not in good condition, not good quality… New Zealand was hit by heavy rain and winds and that affected both our apple crops and our kiwi crops. The new gold kiwi and green kiwi were down overall about 20 per cent due to the weather. Same with the apples; they got hit by hail and also lots of rain and were down by 20-odd percent in terms of volumes. A lot of impacts in all the different locations.

Q: What challenges does this kind of severe weather bring?

A: It affects your ability to get sufficient crop yields to be able to satisfy the customers you promised product to, in the right quality and condition. And then, of course, you finance and put money into the ground with all these crops, so it affects your ability to get that money back.

Q: What does it mean for the average customer walking into their grocery store?

A: You’re going to get a shortage because of weather-related issues, and it’s going to cause the price to go up. Or you’re going to get a situation where there is better than normal weather, the crop is high, and the price will go down because there is an abundance of supply. You can have both of those effects.

Q: Was there a particular crop this year where the price really fluctuated?

A: The biggest one I would have seen price-wise was imported grapes. The California crop, because it was still in drought at the end of last year, before the rains of this year hit, the crops stayed long. Normally it’s out by December, but it hung on right through January. At the same time, you had Peru and Chile end up being three to four weeks earlier than normal, so all three of them collided at the market at the same time. We saw a 40 per cent reduction in price. To be honest with you, a lot of product ended up getting dumped. It was sent to the dump and never got sold.

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Q: Is the weather affecting not just the crop cycle, but your ability to transport it?

A: Sure. The hurricanes had impact on the transportation this year. We use a lot of truck transportation, obviously, to get our products around. With the Texas and Florida hurricanes, the government hired a huge amount of trucks just to sit and be able to transport supplies: water and food. As a result of that, it shorted up the truck supply to be able to move fresh produce, and of course the cost of getting trucks went way up.

Q: Is there a particular crop you’re worried about this year because of extreme weather?

A: Not that I can see right now, today. We’re coming off a tough season with product out of Asia, where there is a lot of typhoons. A lot of the Christmas-type oranges got hit by rain, and that’s been a bit of a problem for us just getting supply. It hasn’t affected the price. And right now, it’s looking like a normal season out of Chile, Peru and California, so the berry crops at the moment seem to be okay.

Q: You’ve worked at The Oppenheimer Group for 43 years now. How drastic has the weather change been?

A: It’s more volatile now. I would see weather events in the past; in those 20-odd countries, I might see three or four weather events in a year. This year, we saw it in every one. We see weather events in much more locations, more frequently, than we did then.

Q: Where do you see things in 10 years?

A: Climate is going to have an impact on us that we’re not exactly sure of at this point. I think as one area closes up, another one will open. If it is actually global warming, you will actually see more areas under which you can grow product. If it’s global cooling we’re looking at—and who knows?—there will be less areas to be able to grow product in, so that will have an opposite impact. The cost of labour is also going to have a major impact on our ability to feed people in the future. The cost of labour is going up through the roof, and the markets are just not giving the returns at this point in time to replace that. A combination of the two—climate change and labour costs—are going to make things more difficult.

This interview has been edited for length


 

How climate change is costing you in the vegetable aisle

  1. When the cost of a barrel of oil was going down the cost at the pump kept rising.

    One thing a market based economy and green tax plans have in common, greed.

  2. Well most humans eat plants in general all the time.. Very little meat.

    They just don’t realize it

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