An Alberta biodiesel plant has switched focus and is now producing food grade canola oil.
Fame Biorefinery has given up on plans to build as many as a dozen six to 10 million litre biodiesel plants in Western Canada.
The one million litre pilot plant it built four years ago in Airdrie, Alta., is now producing cold pressed canola oil for two Alberta retailers.
The facility produced 100,000 litres of biodiesel before it was repurposed last summer.
Labour costs made operating the pilot plant at full capacity unprofitable. The biorefinery needed to be 10 times bigger to be commercially viable, but there was no appetite in the investment community for that kind of project.
“We found the capital markets just aren’t interested right now in doing that,” said company president Keith Jones.
So the decision was made last summer to change the business plan by using the former biodiesel plant to manufacture a product called Vibrant Cold Pressed Canola Oil.
“What we’re really doing with this product is we’re trying to go directly after the extra virgin olive oil market and try to claw back some of that share for Canadian farmers,” said Jones.
Canada imports more than 33 million litres of olive oil annually.
Market research determined that many Canadian consumers stock their cupboards with two types of oil — regular canola oil for frying and olive oil for salad dressings, dips and marinades.
Jones believes cold pressed canola oil offers distinct advantages over olive oil. He contends consumers prefer the flavour and it contains half of the saturated fat and 10 times the omega 3 levels of olive oil.
Vibrant Cold Pressed Canola Oil is available at Calgary Co-op and Sunterra Market in Calgary. Fame Biorefinery is in discussions with other retailers.
The product retails for $12.99 for a 500 millilitre bottle, but the introductory price is $9.99 to stimulate consumer interest in the oil.
Conventional canola oil sells for $3 to $7 per bottle while olive oil retails for $6 to $20.
Jones said other manufacturers of cold pressed canola oil have had trouble keeping their costs down.
“We found we can actually produce it quite a bit cheaper because we have some different technology we’ve developed,” he said.
Retailers originally wanted the product to be produced with certified organic canola, but that proved difficult to find.
The two lots the company could find contained a high proportion of stinkweed, redroot pigweed and buckwheat, which changed the flavour profile.
The six farmer members of Fame Biorefinery’s 12 member investment team provide the plant with genetically modified canola.
The pilot plant has the capacity to produce 1.5 million litres of canola oil annually, but the plant isn’t operating at full capacity because the company is still in the beginning stages of marketing this new product.
Jones said the plan is to build a commercial-scale 15 million litre biorefinery in Airdrie once capital markets regain their appetite for such projects.
It will produce a variety of products including biodiesel and cold pressed canola oil. A plant that size would require up to 40,000 tonnes of canola seed per year.