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A day after a growers’ cooperative that has served farmers for nearly a century filed for creditor protection, citing liabilities of more than $58 million, Prime Minister David Eby announced millions of dollars in additional financial aid for British Columbia’s struggling fruit industry.

Eby said at a news conference Tuesday that the fate of BC Tree Fruits Cooperative, which provided storage and packing services to farmers, is now in the hands of a judge.

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A petition filed with the Supreme Court of British Columbia shows that the cooperative received a demand for repayment of more than $50 million in debt to the Canadian Imperial Bank of Commerce last week.

The cooperative’s application shows that it is “not complying” with the loan agreements with CIBC.

In a statement, the cooperative said the decision to seek creditor protection was due to the group’s “liquidity crisis”, adding that the damage to this year’s stone fruit crop due to unusually bad weather was the “final turning point” in a series of factors.

In mid-January, freezing temperatures prevailed for several days in the interior, killing buds on trees that had just recovered from the heatwave of 2021 and had endured a harsh winter in 2022.

The petition states that the cherry harvest has been reduced by 85 to 90 percent, while all other stone fruit harvests have been “reduced to zero.”

The petition states that CIBC “supports” the cooperative’s restructuring under the Companies’ Creditors Arrangement Act, which allows insolvent companies with more than $5 million in debt to restructure their operations and temporarily fend off collection attempts.

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While the cooperative’s lawyers appeared in court on Tuesday, Eby and British Columbia Agriculture Minister Pam Alexis held a press conference in Penticton to announce support measures for farmers.

Eby said he has called on the federal government to help the province’s farmers and has written to Prime Minister Justin Trudeau asking for help in this “urgent moment.”

“We need their help,” Eby said. “We are facing a crisis like this. We deserve the same treatment as farmers in Saskatchewan, Ontario, Manitoba and Alberta. The crops are different here, the needs are different here and we need a federal government that responds to that.”

He said that, among other things, he wanted the federal government to suspend farmers’ repayments of advance loans for two years.

“Farmers cannot afford to make these payments at the moment,” he said.

Eby said adjustments to the province’s AgriStability program will provide farmers with an additional $15 million in compensation for crop losses and also announced an additional $5 million for a “fruit tree climate resilience program.”

He said the province is also temporarily exempting farmers from the requirement that fruit processed on a property must also be grown there.

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The cooperative announced last month that it would close due to “extremely low” estimated fruit volumes and “difficult market and financial conditions.”

The crisis, the petition states, has been “building up over many years”.

The aim of applying for creditor protection in court is to “maximize repayment for all parties involved,” the group said in a statement.

The application filed to open the case shows that the co-op and a subsidiary owned more than $111 million in assets last year, including several properties, but a property in Kelowna valued at $21 million is currently for sale.

The petition states that the cooperative and its subsidiaries had liabilities of more than $58 million last year, including debts to CIBC as well as amounts owed to growers and other creditors.

Eby said Tuesday the province would monitor the creditor protection proceedings “closely” and consider what could be done to ensure “key assets are protected” or whether the services it previously provided could continue during the proceedings.

“The cooperative has faced some major challenges. It has had some governance issues that the province has tried to support with some resources, and it is obviously struggling with significant debt,” he said.

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“I’m sure it was not an easy decision for the board to cease operations. From the provincial government’s perspective, it was quite sudden and now we are in a situation where it is going to court and we will make sure that we do everything we can to protect the farmers while recognizing that the cooperative is now in this legal process.”

Eby said British Columbia producers also face unfair competition from subsidized produce imported from the United States and “extortion” from grocery retailers.

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