The opening of a new flour mill in Chilliwack, B.C., shows that the Canadian Wheat Board is not an impediment to the development of value-added processing in Western Canada, say officials involved in the project.
Rogers Foods Ltd. officially opened its new 250-tonne-per-day capacity mill April 5, although the facility had actually been operating since late last year.
The new $25 million plant will process roughly 335 tonnes of high quality prairie wheat every day, or about 90,000 tonnes a year, and serve customers in the lower mainland of British Columbia, the U.S. Pacific Northwest region and markets in Asia.
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Representatives from the company and the board say co-operation and support between the two was an important part of the development.
“In no way, shape or form was our experience with the board negative,” said Lew Rossner, vice-president of administration for Rogers Foods Ltd.
“All I’ve been aware of is that they have been supportive and worked with us on any questions that we had.”
CWB officials say the opening of the Chilliwack plant provides further evidence that the flour milling industry in Western Canada is thriving under the CWB marketing system.
The new plant brings to 19 the number of flour mills operating in the West, with daily production of 3,700 tonnes, representing 34 percent of total Canadian capacity. In 1999,there were 15 mills with a combined capacity of 2,625 tonnes, representing about 30 percent of Canadian capacity.
“The board is clearly not an impediment to value-added processing, and the new Rogers mill is a case in point,” said CWB chair Ken Ritter.
“Any mill, regardless of size, can open up wherever they feel is most expedient and most profitable for them.”
While Western Canada accounts for roughly one-third of Canada’s milling capacity, in the United States the comparable grain producing region is home to only about 15 percent of that country’s milling industry, say board officials.
Rossner said Chilliwack was chosen as the location for the mill in order to be close to domestic and foreign markets.
“We are growing our business domestically and on an export basis throughout the Pacific Rim, and Chilliwack provides easy access to all of those markets from an agriculture-friendly venue,” he said.
While the domestic market accounts for about 85 percent of Rogers’ business, the past two decades have seen steady growth in containerized shipments of flour to Asian buyers.
“That is an important and growing part of our business,” said Rossner, although he declined to provide more detail about overseas customers or the value of those shipments.
Jim Thompson, the CWB’s marketing manager for North America, said the board did meet with Rogers to discuss possible sites for the mill.
While the board doesn’t as a matter of policy offer special pricing deals to any individual flour mill, he said, it can offer other incentives to locate in Canada, and in Western Canada specifically. These incentives include an uninterrupted 12-month supply guarantee, competitive pricing based on North American market value, a consistent, high quality product and technical assistance and support through organizations such as the Canadian International Grain Institute.
Thompson said that given the continuing decline in per capita flour consumption in Canada (down two percent in 2004 after a six percent drop in 2003) and the U.S., there probably aren’t any new flour mills on the horizon for a while.
“I would say we’re probably in a pretty balanced situation with supply and demand right now,” he said.
“Would there be a need for another mill at this time? I think you’d be hard pressed to make a case for it at this time.”
Rogers is a subsidiary of Nisshin Flour Milling Inc., part of the largest milling company in Japan. Mitsubishi Corp. is also a major shareholder. Rogers buys mainly hard red spring wheat, along with some soft wheat, to make flour for a variety of products.
The new plant was built in such a way as to easily accommodate a 20 percent increase in capacity. Land is also available to build a second mill of similar size if demand requires further expansion.
