The Government has put 50,000 dollars on the table to find out whether a group of Hawke’s Bay growers can buy the McCain Foods vegetable factory in Hastings and run it themselves, giving the region’s pea, bean, corn and carrot suppliers a slim chance to keep their industry alive before the plant shuts early next year.
Agriculture Minister Todd McClay announced the funding on Friday, describing it as the first stage of a feasibility study that will test whether a grower-led purchase of the site could ever stack up commercially. “The Government is committing $50,000 for the first stage of a feasibility study to assess what is required for a grower-led purchase of the site to be commercially viable,” McClay said, in comments reported by RNZ.
He also acknowledged the strain the closure has placed on the region. “I know this is a difficult time for the more than 100 Hawke’s Bay growers impacted by the site’s closure and the rural communities they belong to,” he said.
The money is modest against the scale of what a buyout would involve, but it matters because of the clock. McCain plans to stop processing at Hastings in late January 2027, and once the factory falls silent the specialised freezing and packing machinery could be packed up and shipped overseas. If that happens, the option of a grower takeover effectively disappears, because rebuilding that processing capacity from scratch would be far beyond what a farmer cooperative could afford. The feasibility funding is meant to get hard numbers in front of growers while the plant is still intact and a sale of the site is being negotiated.
McCain, a Canadian-owned multinational, confirmed in late May that it could not pause the closure, telling RNZ the commercial sale process for the site was already underway. The company said it had reviewed the operation and “considered a range of options to strengthen the long-term position of the site” but was “unable to identify a sustainable pathway under the current model”. McCain ANZ agriculture director Josh Opas said the company would honour existing grower contracts through the current season, while making clear it would not keep the factory running beyond that.
For the growers, the decision lands hard. The Hastings plant has been the anchor for a network of more than 100 vegetable farms that supply peas, beans, sweetcorn and carrots, and many of those operations have built their cropping rotations, machinery and seasonal labour around the factory’s contracts. Lose the processor and the crops have nowhere to go, because frozen vegetables of this kind cannot simply be redirected to the fresh market or trucked to another plant without enormous cost.
That is why a core of farmers has been pushing the takeover idea since at least mid-May. Central Hawke’s Bay farmer Alistair Setter, who crops 180 hectares, told RNZ there was real appetite to step in. “There’s a lot of desire among farmers like myself and other industry participants to have a go at trying to save it,” he said. Hugh Ritchie, a pea grower who has supplied McCain for more than 30 years, has argued the whole food production chain needs to be put under the microscope to understand why a plant that turns out food people clearly want cannot be made to pay.
Central Hawke’s Bay Mayor Will Foley summed up the frustration that has spread well beyond the farm gate. “It doesn’t seem right that we can’t produce that food and sell it locally and for export, all at a success,” he said. Foley was one of the local leaders who earlier asked McCain for an eight week pause on the closure so the buyout plan could be tested, a request the company turned down.
The feasibility study now has to answer the questions that will decide whether the idea is anything more than goodwill. A grower cooperative would need to know what McCain wants for the site, how much working capital a year-round processing business requires, whether the existing customer contracts and export channels can be retained or rebuilt, and whether enough growers will commit volume to keep the lines full. It would also have to confront the same cost pressures that drove McCain out, including energy, labour and the price squeeze that runs all the way through to the supermarket shelf.
The Hastings situation is not happening in isolation. The closure follows Heinz Wattie’s decision to shut four plants, and together the two cases have fed a wider unease about the future of food processing in New Zealand, a sector that turns the country’s farm output into the products that fill freezers and pantries. Each plant that closes narrows the options for growers and pushes the country a little further towards exporting raw produce and importing the finished goods made from it.
A grower-owned processor would be a different animal from a multinational subsidiary. Rather than answering to a head office on another continent weighing Hastings against plants in Canada or Europe, the business would be owned by the people whose livelihoods depend on it staying open, which changes the calculation about what counts as an acceptable return. Whether that difference is enough to overcome the economics that defeated McCain is exactly what the 50,000 dollars is meant to find out.
The next few months will be decisive. The study needs to deliver answers well before the January shutdown, because once the machinery is gone, so is the chance to keep a century of vegetable growing in the region tied to a local factory.
Do you think a grower cooperative can succeed where a multinational gave up? Should the Government back the buyout further if the study stacks up? Share your thoughts in the comments below.
This article was written by AI, briefed to report the facts, hopefully without some of the bias people bring to the job 🙂
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