Kraft Heinz to bring its ketchup production back to Canada

It’s a battle fought with bottles to squeeze, one garden barbecue at a time.

The Great Canadian Ketchup War is back again.

Six years after it retired its century-old plant in Leamington, Ontario, and moved manufacturing to the U.S. – a move that resulted in a consumer boycott and allowed a competitor to grab a big chunk of the market – Kraft Heinz announced. Tuesday that his iconic ketchup brand will be produced again in Canada.

Starting in 2021, Heinz ketchup production for the Canadian consumer market will be moved to an existing Heinz plant in Montreal. The facility includes a new $ 17 million ketchup production line, partially funded by a $ 2 million loan from the Quebec government.

“It was the right time to bring this great brand back to Canada,” said Av Maharaj, managing director of Kraft Heinz. For now, the plant will use tomatoes from US suppliers with whom the company is contracted, but within a year or two Kraft Heinz hopes to use Canadian tomatoes to make ketchup in Montreal, Maharaj said.

Maharaj admitted that it was not ideal for the brand to have left Canada in the first place, a move that allowed competitor French to leap into the void and devour market share in the once monolithic world of ketchup sales.

“It was a shame to close the plant at that time,” said Maharaj, who pointed out that several Kraft products are still made in Leamington from local tomatoes – including Kraft BBQ Sauces and Classico Pasta Sauces – after the company sold his plant there in Highbury Canco.

Scott Holland, a resident of Leamington, who wrote a book about the history of the Heinz processing plant for its 100th anniversary in 2009, said news of the iconic product’s return to Canadian production was spreading like wildfire. oil in the city. But, he added, both tomato growers and ordinary citizens are baffled as to why the company would not want to return to Leamington.

“Why would you renovate a factory in Montreal when you could do it where tomatoes are grown? This is the land of tomatoes, “Holland said.

In a city where nearly everyone knows someone in the tomato processing industry, Heinz’s 2014 move still stings, Holland said.

“People are still upset. Maybe not more than five or six years ago, but they are still upset. If people find out they’re not using Leamington tomatoes, they won’t come back, at least not around here, “said Holland, who worked at the plant during his student years. His grandparents also worked there, one as a guard and one as foreman in the mustard production area.

“My wife switched to French when Heinz left. It won’t come back. His father worked at the factory, “Holland said.

In the wake of Heinz’s 2014 move, French’s rushed out and started making its ketchup in Canada, from tomatoes grown largely by farmers near Leamington. This allowed him to slap a Canadian flag on his bottles and provided the marketing opportunity of a lifetime. Now, one of the world’s largest consumer products giants is reacting, said branding expert David Kincaid.

“They saw this as a lost ball on the brand side and decided to correct it,” said Kincaid, founder and CEO of Level5 Brand Strategy.

Kincaid likened Heinz’s decision to withdraw its production from Canada to something widely regarded as one of the greatest marketing disasters of all time.

“Strategically, this is exactly like New Coke. You’ve given your customers a reason to question the core value of your product, ”Kincaid said.

Since the move in 2014, Heinz has seen its share of the ketchup market rise from well over 80% to a still substantial 75%. Most of that loss was at the hands of the French, said Sylvain Charlebois, director of Dalhousie University’s Agri-food Analytics Lab.

Bringing production back to Canada was something Kraft Heinz had to do, Charlebois said.

“Maple leaf is everywhere in the ketchup aisle. Heinz was one of the only ones that wasn’t made in Canada, ”Charlebois said.