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Can Thornloe Cheese be saved again?

Gay Lea Foods cites 'multiple' deficiencies behind plant closure as efforts begin to reopen the iconic Temiskaming cheesemaking business
(Northern Ontario Business file photo)

In 2007, Timiskaming-Cochrane MPP John Vanthof remembers how farmers and communities on the Clay Belt pulled out all the stops to save Thornloe Cheese from closure.

Now once again, the NDP agriculture critic said he fully expects people in this region will rally to prevent the popular Highway 11 roadside attraction and its 35 storefront and factory jobs from vanishing for good.

“Everybody knows Thornloe Cheese; everybody stops there. They’re emblematic of us and of the little train that could. We don’t want to lose that little train.”

Vanthof was responding to the news that the award-winning 83-year-old cheese- and butter-making company had been permanently shuttered by its Mississauga-based owners, food processing giant Gay Lea Foods.

Sources said Thornloe had experienced a series of catastrophic equipment failures this fall, beginning with a cheese curd machine. New equipment had been ordered but the replacement machines were vetoed by Gay Lea management when the price tag approached $11 million.

Gay Lea is attributing the closure to the antiquated state of the factory and its overall performance as not justifying the substantial investment to bring the facility up to modern standards.

Vanthof, a long-time shareholder of Gay Lea going back to his former dairy farming days, said he spoke with company CEO Suzanna Dalrymple early Monday afternoon to set up a meeting with the southern Ontario farmers co-operative to find a way to reopen the facility.

The search will be on, he said, to find someone with expertise and a viable business plan to operate the plant “or reconfigure a different one.”

“If Gay Lea doesn’t want to do it, then we’ll look at someone else willing to do it."

Vanthof said the plant stopped production two weeks ago. Like many in the area, he had heard rumours of a possible closure. As the only milk processor in Temiskaming, Thornloe takes in about 10 per cent of the region’s total milk production.

Vanthof emphasized the importance of keeping the milk production quota at the plant.

“Gay Lea might not want to do that,” he said. “We’re not out to be in a fight with Gay Lea, but we are very willing to fight for business in Northern Ontario, especially in Thornloe Cheese.

Sixteen years ago, Montreal-based food processing giant Parmalat, with aims of closing Thornloe for good, didn’t want to transfer the quota but eventually succumbed to public pressure from a grassroots farmers movement. 

“We didn’t fight for it years ago just to wave and say goodbye.”

Vanthof said he will assist in any way to help Gay Lea or new ownership access any provincial business development funds to restart the business.

Over the decades, Thornloe has faced many challenges to stay open. 

Founded by René Laframboise in the village of Thornloe in 1940, the factory went through a succession of owners, relocation and expansion at its current Highway 11 location, 17 kilometres north of New Liskeard, under the Jubinville family, Balderson Cheese, Ault Foods, Parmalat, and Gencor, a Guelph livestock genetics company, which eventually paved the way for Gay Lea’s acquisition of the business in December 2019.

Mike Langdon, Gay Lea’s vice-president of corporate and co-operative affairs, said the company agonized over its decision, but it was in the best interests of the farmers co-operative of 1,300 dairy farmers across Ontario and Manitoba.

“This was an incredibly tough decision. It's a really sad day for all of us.”

The facility is many decades old — some equipment dating back to the 1940s — and is in need of significant capital investment, something that Gay Lea, he said, was well aware of when it bought Thornloe in 2019.

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Langdon didn’t identify specific operating issues except to say there were “multiple deficiencies identified across the plant,” including the cheese vats, “which were certainly an issue.”

He said the plant was shut down briefly in mid-September to allow cheesemakers from one of Gay Lea’s Manitoba facilities to make a thorough assessment of Thornloe, and outline what would be required to bring it up to “modern food safety and quality standards.”

They reported back that given the plant’s age, condition and the food safety risk, upgrades would require a minimum investment of $10 million, “and likely more.”

That wasn’t something Gay Lea’s directors and management were prepared to do for the long term. The capital upgrades needed “far exceeded the value that this facility could ever produce.”

Over three years, Langdon said they had placed a priority on sales and marketing efforts, on product and manufacturing processes, but just didn’t see the performance to warrant making such a huge capital investment.

“Any food manufacturer looks at each of its sites and determines how they’re performing, and how they fit in with the operating network and how they perform individually. Facilities need to be able to survive on their own merits.

“We worked really hard with our management team, and our board to try to avoid it but, at the end of the day, the gap between the investment required and the value that the facility can produce is just so large that it really becomes tough to justify.”

Knowing Thornloe’s history of coming back from the brink many times, Langdon said Gay Lea would be open to selling the factory. “We would absolutely entertain any conversation with an interested buyer.”

As to the production quota, Langdon said that, too, is negotiable.

“We'd be happy to entertain a discussion about quota attached to Thornloe, should a prospective buyer of the facility step forward. The greater challenge, we believe, is the buyer would have to see a path to invest in the facility, bringing it up to acceptable standards, while being confident it could remain financially viable."

Langdon said their attention now turns to the 35 employees and “treating them with care and compassion and making sure they’re supported financially as they transition to the next step in their careers.”

Gay Lea’s decision doesn’t sit well with James Franks, who works in economic development for the City of Temiskaming Shores.

He had heard from a company source this week that plant equipment failures began about a month ago. New equipment had been ordered, but as costs began to escalate, Gay Lea management vetoed the purchases.

Franks said he had sensed things were not right when the local Gay Lea representative asked that Thornloe not be included on a farm tour at a recent Temiskaming agriculture economic development forum.

The sense of disappointment by convention delegates was so palpable that the tour bus ended up stopping anyway at the Highway 11 storefront.

Franks said the people employed at Thornloe will surely find work in agri-food positions elsewhere in the region, but Temiskaming is losing a regional name-brand producer that is a cornerstone of the area’s emerging agriculture and culinary tourism scene.

The situation, he said, is reminiscent of Parmalat’s acquisition of Thornloe in 1997. Both Parmalat and Gay Lea bought the plant knowing it needed upgrades, the discounted purchasing price being reflective of the shape of the facility.

While he credits Gay Lea for significantly increasing Thornloe's product reach across Ontario, he’s disappointed the company never made the effort to invest in the factory.

He hopes Thornloe can reopen under new sustainable ownership for the long run, "but it may not be easy to find someone to take it over knowing the huge dollars to reopen it.”

Vanthof said he’s supremely confident the Thornloe closure will inspire another rallying cry across the region.

His two social media posts yesterday announcing the Thornloe news “got more traction than almost anything I’ve done in 15 years.

“That tells me people are invested and that might be enough to get Gay Lea to look at the situation. Sometimes keeping it takes a fight.”