Ceres Global Ag plans to complement its existing Saskatchewan terminal with more elevators in Western Canada
Ceres Global Ag is looking to expand its presence in the North American grain business by adding new elevator locations on the Prairies and developing new partnerships with existing grain companies.
Chief executive officer Robert Day said his company is looking at a number of potential new western Canadian elevator locations in an effort to enhance grain origination efforts and augment volumes already flowing through the Northgate Terminal, Ceres’ first and only prairie elevator.
“What we’re all about is serving our key customers … and in order to do that more effectively, it’s important to have a more diversified origination base,” Day said.
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“To do that, we need to have a bigger presence in the heartland of Western Canada.”
Day said Northgate’s grain volumes have increased steadily since the elevator became fully commissioned two years ago on the Saskatchewan-North Dakota border.
The Northgate Terminal already handles 450,000 to 500,000 tonnes of grain, pulses and oilseeds per year.
Ceres management said volumes at Northgate could grow as high as 600,000 tonnes per year without any additional capital outlay.
However, the company would like to expand its Canadian presence, either through new partnerships or by adding new Ceres-owned facilities, he said.
As far as potential new locations, “we’re looking at a couple of options and potentially some partnering opportunities as well with some companies that already have a network,” Day said.
“I’d say it’s probably more likely that we’ll have additional Ceres elevators representing our network, but really, the goal is to consistently provide our customers with the quality and service that they require and I think that can be achieved through either partnerships or by owning more facilities ourselves.”
Day said Ceres’ first elevator — Northgate — has benefited from its unique location, just a few hundred metres north of the Canada-U.S. border.
The Northgate site is served by American rail carrier BNSF, which runs trains across the international border and provides a direct link to the BNSF network in the United States.
“When we started (at Northgate) there were many unknowns because trade flows had never really moved in this direction on a consistent basis before,” he said.
“Canada’s crops had never been connected directly to a U.S. railroad.”
However, as new market opportunities have emerged, Ceres officials have recognized the merits of expanding into new production areas.
“North of the border is a big part of where we see our future expansion,” Day said.
“We want to significantly grow in Western Canada, as far as our ability to handle and merchandise our core products: spring wheat, durum, canola and oats.”
Day said Ceres would like to move more grain through Canadian export gateways, a scenario that would require the company to negotiate commercial port capacity at Vancouver, Prince Rupert or Thunder Bay.
“How you get access to (Canadian ports) — that’s certainly a more complicated question,” Day said.
“But in general, I would say that we’re happy to see new port investments in British Columbia and because that’s happening, we think we’ll have an opportunity to get access to port capacity.”
Day said Ceres will continue to look for opportunities to develop new markets and build stronger relationships with western Canadian farmers.
“With a more diversified origination base in Canada, I think we’ll be able to do that on a broader scale.”
