A flax processing plant will eventually re-open in Brandon, but it may take another couple months to get Shape Foods up and running, said owner Jim Downey.
“We’ve been busy with getting the plant ready to get back into production…. We’ve still got a considerable ways to go,” said Downey, a former provincial cabinet minister under Gary Filmon’s Conservative government in the 1990s.
When Downey bought Shape Foods this summer, he was hoping the crushing and oil bottling plant would be running by September. But he now believes they’ll be bottling flax oil by late 2009 or early 2010.
Downey and three other investors purchased the assets of Shape Foods for $5.1 million, the winning bid in a receivership auction.
The previous owners of Shape Foods, which was founded in Burnaby, B.C., spent $1.7 million to build and equip a 6,300 sq. metre plant in Brandon that produced its first flax oil in December 2007.
When fully operational, the plant was capable of processing 20 tonnes of flax per day.
The company touted its new processing technology, which kept the flaxseed oil shelf-stable for one year, and it promoted the health benefits of the omega 3 fatty acids in flax oil.
But Shape Foods went into receivership in October 2008 when Vanguard Credit Union of Brandon called a $4.5 million loan, putting Shape’s 60 employees out of work.
Shape Foods’ previous owners put most of their marketing eggs in the U.S. basket, Downey said. The new enterprise will concentrate more on domestic sales.
“The initial plan (when Shape first opened) was to go into the high-end U.S. market,” said Downey. “We have some product and you’ll see a lot more of it shortly in the Manitoba market.”
The Canadian focus doesn’t mean the company will ignore international opportunities, said Downey, who added the recent controversy in Europe over GM flax shouldn’t affect Shape Foods’ sales.
“I’m not at all worried about our brand because of our quality control and the type of product we have,” he said.
Farmers have contacted Shape Foods to grow flax for the company, Downey said, but he’s not ready to contract acres just yet.
“At this point, until we get a little better handle on what the demand will be, we aren’t being overly aggressive (buying flax).”