Friday, August 21, 2020
CapitalPress.com 3
NORPAC reaches $4.5 million settlement deal with growers
By MATEUSZ PERKOWSKI
Capital Press
About 100 farmer-members of
the NORPAC cooperative would
be paid $4.5 million for last year’s
crop deliveries under a proposed
settlement deal with the bankrupt
food processor.
The cooperative has submit-
ted the compromise agreement for
approval to U.S. Bankruptcy Judge
Peter McKittrick, who is sched-
uled to hear the matter on Sept. 11.
Earlier this year, the coopera-
tive — now called North Pacific
Canners & Packers after selling
its name and intellectual property
— filed a lawsuit against several
growers who demanded payments
for 2019 crops.
The complaint sought a dec-
laration that 10 farmer-members
Capital Press File
Workers at NORPAC Foods prepare onions for processing. Under a
settlement deal, the cooperative will pay some compensation to
member farms for crop deliveries.
weren’t entitled to any payment for
last year’s crop deliveries because
as cooperative owners they’re sub-
ordinate to all other creditors who
are owed money by NORPAC.
The
10
farmer-members
claimed to be owed $2.3 million
for corn, bean, cauliflower and
broccoli crops that were secured
with agricultural liens, which
would place them at the front of
the line for repayment.
However, the lawsuit was con-
sidered a test case that would affect
NORPAC’s other farmer-members
with similar bankruptcy claims,
which the cooperative estimated to
be worth between $16 million and
$18 million.
The farmer-members filed a
countersuit arguing they were no
longer barred from filing agricul-
tural liens against NORPAC after
it became a “debtor in possession”
and “failed to operate as a cooper-
ative” after filing for bankruptcy
last year.
To further complicate matters, a
committee representing unsecured
creditors wanted to file a test law-
suit against the 10 farmer-mem-
bers seeking repayment of $5.3
million they’d received in past
crop payments, which would also
have implications for NORPAC’s
other growers.
Under the proposed settle-
ment, the litigation between NOR-
PAC, farmer-members and unse-
cured creditors will be dropped
if growers who would receive
85% of the deal’s $4.5 million
economic value opt-in to the
agreement.
The settlement deal should be
approved because the litigation
involves “novel issues of Oregon
law and the Bankruptcy Code,
untested Oregon statutory provi-
sions, a complex web of corporate
documents and agreements, and
detailed factual issues for each of
the Named Defendants,” according
to the cooperative.
Pandemic expected to
Inslee sets up COVID-19 fund for farmworkers
fuel more dairy volatility By DON JENKINS
not in the country legally and
Capital Press
By CAROL RYAN DUMAS
Capital Press
The COVID-19 pan-
demic has taken dairy mar-
kets on a wild ride, and it’s
not over yet, an economist
says, adding that a sec-
ond wave of the pandemic
will likely cause more
volatility.
Dairy is notoriously
price inelastic, meaning that
small changes in demand
or supply can cause large
price movements, Peter
Vitaliano, chief econo-
mist for National Milk Pro-
ducers Federation, said in
the latest “Dairy Defined”
podcast.
“We’ve seen over the
last several months an
unprecedented series of
major changes in both sup-
ply and demand that have
whipsawed prices both
down and up,” he said.
Prices are now heading
back down again, obey-
ing the laws of supply and
demand, he said.
The start of the pan-
demic brought a sudden
loss of demand, particu-
larly from foodservice as
consumers shifted away
from restaurants, shopped
more at supermarkets and
ate at home, he said.
“But the increase in
retail sales did not over-
come the loss of foodser-
vice sales,” causing prices
to drop, he said.
That lost demand hap-
pened at
the same
time dairy
f a r m -
ers were
expanding
milk pro-
duction,
Peter
further
Vitaliano
depress-
ing prices, he said.
Dairy cooperatives and
farmers responded quickly
with significantly lower
production. At the same
time, the federal gov-
ernment stepped in with
large-scale purchases of
dairy products, expanding
demand and sending prices
upward.
A second wave of the
pandemic is now starting
to affect foodservice again.
Government purchases are
continuing but not with the
same initial rush. Farm-
ers are starting to expand
milk production, and some
of the supply measures are
coming off, he said.
Now schools are look-
ing at not reopening fully
in person. That’s cast-
ing an additional negative
on the situation as school
milk purchases will likely
be smaller than normal, he
said.
“So the bottom line is
we have seen ... record-
high monthly increases
(and) monthly high record
decreases in a number of
the major pricing catego-
ries,” he said.
Washington farmworkers
forced to isolate by COVID-
19 will be eligible for paid
medical leave beginning next
week.
Gov. Jay Inslee issued a
proclamation Aug. 13 allow-
ing domestic and foreign
farmworkers to collect ben-
efits, even if they wouldn’t
normally qualify. Paid leave
will encourage workers to
quarantine, rather than risk
infecting co-workers, Inslee
said.
“We have heard about
folks who have been unable
or unwilling to isolate, even
though they were positive
because they had to feed
their family,” Inslee said
at a press conference in
Olympia.
Earlier in the day, Inslee
went to Okanogan County
in north-central Washington
and met with local officials,
growers and farmworker
representatives. COVID-19
cases there have soared in
recent weeks. Two infected
Gebbers Farms workers, one
from Mexico and one from
Jamaica, have died.
Okanogan Public Health
on Aug. 14 encouraged all
county residents to be tested.
The tests are free. A National
Guard unit will go the county
to help with testing.
Inslee said he hoped more
testing, better access to med-
ical care and paid leave will
slow the rate of infection in
Okanogan County, espe-
TVW
Washington Gov. Jay Inslee speaks at a press confer-
ence Aug. 13 in Olympia. Inslee has set up a fund to give
farmworkers sick with or exposed to COVID-19 paid
medical leave.
cially among farmworkers in
labor-intensive agriculture.
“You recognize that in the
real world, there isn’t some-
thing called zero risk. If
we’re going to eat, there is
going to be some risk. And
it’s a hard thing to realize,
but it is the circumstance,”
he said.
Farmworkers
infected
with COVID-19 or quar-
antined because they’ve
been exposed will be eli-
gible for up to $860 over
two weeks, according to the
proclamation.
Employers will pay work-
ers and be reimbursed from
a $3 million fund, a gover-
nor’s spokeswoman said.
The money will come from
the federal CARES Act. For-
eign workers, as well as U.S.
workers, are eligible.
United Farm Workers
Forecasters: Odds improve for La Nina weather pattern by fall
By DON JENKINS
Capital Press
Odds increasingly favor
a La Nina weather pattern
taking hold by fall, upping
the chances for a cold and
wet Northwest winter, the
National Weather Service’s
Climate Prediction Center
says.
The center pegged at
60% the chances of a La
Nina prevailing in Novem-
ber, December and Janu-
ary. A month ago, the cen-
ter put the chances at 53%.
Since then, the Pacific
Ocean has resumed a cool-
ing trend that started last
spring but paused in June
and early July, according to
the center.
A
cooler-than-aver-
age
ocean,
especially
along the equator in the
mid-Pacific, triggers atmo-
spheric changes to form a
La Nina.
Its opposite, El Nino, is
cased by higher-than-aver-
age ocean-surface tempera-
tures and is linked to warm
Northwest winters and
below-average snowpacks.
Currently, the ocean and
atmosphere temperatures
are neutral, indicating nei-
ther a La Nina nor El Nino.
The center predicted
a 36% chance conditions
will still be neutral next
winter. The center rated
the chances of an El Nino
forming at only 4%.
The last La Nina reigned
in the winter of 2017-18.
Washington’s
snowpack
that winter was 113% of
normal.
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National Vice President Erik
Nicholson said paid leave
will keep the agricultural
workforce healthier. “It’s in
all of our interest,” he said.
“It’s been something
we’ve been advocating for
for months. It’s been a big
hole,” Nicholson said. “It
(the lack of paid leave) has
been putting workers in a
horrible situation in making
a decision they never should
have had to make.”
The Inslee administration
also has set aside $40 mil-
lion from the CARES Act for
payments to people who are
not eligible for federal stimu-
lus checks.
Some 38,000 people will
receive $1,000 checks in
October, totaling $38 mil-
lion. The other $2 million
will go to a contractor and at
least five subcontractors for
distributing the money. The
state has not yet picked the
contractor.
“This immigrant relief
fund is going to help work-
ers who are the backbone of
our agricultural economy and
many other parts of our econ-
omy,” Inslee said.
Okanogan
County’s
infection rate in the past 14
days has been 395 COVID-
19 cases per 100,000 peo-
ple, county health officials
reported Aug. 14. The rate
is roughly triple the state
average.
Before his Olympia press
conference, Inslee held a sep-
arate phone call with report-
ers to talk about his trip to
Okanogan County. “It’s no
secret that labor-intensive
agriculture presents environ-
ments that are just ripe for
high transmission rates,” he
said.
Lowering transmission
rates will require workers
taking precautions off the
job, Inslee said.
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