GLK Foods announced Shortsville plant will close in mid-September
SHORTSVILLE — The news that the GLK Foods plant in Shortsville will be closing about midway through September came as a shock to village, town of Manchester and Ontario County officials, none of whom said they saw it coming.
In fact, Manchester Supervisor Jeff Gallahan said he only learned of the news from a farmer he was talking to, just days before the company announced Wednesday it was “consolidating” the plant with its operation in Bear Creek, Wisc.
“We’re definitely trying to figure out what’s going on,” said Gallahan, who said his father worked at the plant in the 1940s, which has been in the area for over 100 years. “It’s disappointing, but we’re going to see what we can do to save it.”
The company, formerly known as Great Lakes Kraut, announced the news Thursday, Feb. 8. According to a press release issued by the company — which is how several local officials said they learned of the news — the decision comes as a result of expansion opportunities at the Bear Creek plant and does not reflect the valued commitment and talent of the Shortsville staff.
The plant on Clark Street processes cabbage, which is a key ingredient of sauerkraut. Nearby Phelps pays homage to the food with its annual Sauerkraut Festival.
“This consolidation was an extraordinarily difficult business decision, and we recognize the huge impact it will have on our employees and their families,” said GLK President Ryan M. Downs in the press release.
“We are forever grateful for the hard work and dedication of the Shortsville staff, and we intend to support affected employees, both monetarily and through outplacement services, while they transition and search for new employment,” Downs stated.
Production will continue at the plant through mid-September, the company said. Shipping and receiving will continue through the end of the year.
Many of the employees will be retained through this time, the company said.
Ontario County Economic Developer Mike Manikowski said the consolidation affects between 25 and 40 employees, and county Workforce Development stands ready for assistance.
“We’re going to do everything we can to help these people,” Manikowski said.
The closing will have an impact on the regional agricultural economy and Manikowski is concerned about it, but he said there is time for growers and planters to find other markets.
“Please don’t think cabbage is down in Ontario County,” Manikowski said.
Those are not the feelings of one of the largest cabbage growers in the area. Dale Hemminger, of Hemdale Farms near Seneca Castle, started growing cabbage with his father in 1977. He can remember when there were 20 sauerkraut processing plants in this area where the commercial production of sauerkraut began. Many of those were consolidated over the years into the vastly expanded Shortsville plant. Once that closes, says Hemminger, the small Seneca Foods plant in Geneva will be the only kraut producer left.
Hemminger expects to cut 200 acres from his cabbage planting this year, and knows 20 other farmers who will be similarly effected. Eric Hansen, another farmer from Stanley says he began to back off cabbage acreage 5 years ago and will back off another 50 acres this year. “It will effect us, but kraut is not a huge part of our business anymore,” he says. All of the cabbage they will grow is harvested by hand, and mostly destined for the fresh market sales. Jill Henderson, of Henderson Farms in Penn Yan, says they stopped growing cabbage when they “saw the writing on the wall an year and a half ago.”
Hemminger’s hit is deeper not only because of his larger acreage. He also developed a business of growing cabbage seedlings in greenhouses as “plugs” for other farmers to plant. “I’ve got $50,000 worth of cabbage seed sitting at my office I don’t know what I’m going to do with.” He also has contracted workers scheduled to arrive soon to begin the seeding process.
Beyond these practical challenges, Hemminger invested over $300,000 in the last year alone, building two new greenhouses and buying a tractor specially configured for cabbage. “I wish I could run the clock back on that decision,” says Hemminger. “This was the base of our market. GLK was critical to our base business.”
Hemminger and Hansen both attribute GLK’s move to a difficult business climate here in New York State, especially for agriculture. Hemminger says that one of GLK’s major competitors is based in Ohio, but New York’s minimum wage is 25 percent higher that Ohio’s. “Each line item in production is higher in New York by 5 to 10 percent,” says Hemminger, and that adds up to about a $1 per case higher cost of production in New York. “Companies are voting with their feet and moving out of state. It’s frustrating to see N.Y. being less competitive. This is another nail in the coffin of N.Y. State agriculture.”
The news was especially galling to Hemminger because he learned of it in the same hour Gov. Cuomo announced $50 million in economic aid going to Rochester. Hemminger says spending in the state is out of control, “and Cuomo is spending money like a drunk sailor.”
Hansen calls it “a sad day for the history of sauerkraut in the area. It all started here, but it’s probably not coming back.”
The loss of crop diversity and the industry is a blow, but both farmers say they will figure something out for those acres. “Our families are N.Y. farmers, and we’re going to try to make this work,” asserts Hemminger. “I feel bad for the 50 employees at the plant,” he adds. “Some of them are lifetime friends who are going to be out of work.”
The county Industrial Development Agency had approached the company over the last two years as part of its routine business retention and expansion program, although no response from the company was given, he said.
The IDA had helped the company several years ago, but there is no existing assistance, Manikowski said.
Anecdotally, Manikowski said he had heard the company was doing fine so the consolidation news came as a shock to him as well.
“Personally, I think it’s a mistake, but that’s up to them,” Manikowski said. “This is a private, corporate business decision. I think it’s the wrong one, but I’m not in their shoes.”
Gallahan said the number-one goal is to keep the plant here, but as of Thursday afternoon — a day after the news broke — he said he had yet to hear back from Downs. “If we can’t, we’ll have to cross that bridge when we come to it,” Gallahan said.
There was talk 10 years ago about closing the Shortsville facility, with Downs at one point saying he was “pretty damn sure” the plant would close.