SASKATOON — Another point on the Saskatchewan compass could soon be home to a farmer-owned grain terminal.
North East Terminal Ltd. has been in business in Wadena since 1992. North West Terminal Ltd. is selling shares in a proposed elevator in Unity, Sask.
And now a group of farmers around Gull Lake have announced plans to to set up a company to be called South West Terminal Ltd.
The farmers want to build a 500,000-bushel elevator to serve a large area around Gull Lake, located about 55 kilometres west of Swift Current on the Trans-Canada Highway.
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The farmers involved in the project are currently applying for incorporation as a company and seeking preliminary approval from the Saskatchewan Securities Commission. If all goes well, the company will sell shares to the public and start construction in 1995.
Ernie Sommer, a Gull Lake farmer and chair of the four-member board, said a group of about 20 farmers have been working on the idea for about a year.
During that time, they’ve gained commitments of financial support from about 250 producers, who are willing to put up $100,000 to pay for the costs of incorporation and a feasibility study by an outside consultant.
Sommer said the group has been inspired by the success of farmer-owned terminals at Weyburn and Wadena, as well as the proposed facility in Unity.
Limited selling choices
Farmers in the southwest have limited choices when it comes to selling grain, he said, with only Saskatchewan Wheat Pool and Pioneer Grain Co. having any real presence in the market.
“We’d offer a marketing alternative to all producers in the area of the province, because we’d look further out for our supplies of grain than most elevators,” he said.
He said a lot of area farmers now haul their grain to inland terminals run by AgPro Grain at Moose Jaw and Cargill Ltd. at Rosetown or even Lethbridge, Alta., “so we feel there is room for an operation of this type here.”
While a formal business plan hasn’t been prepared, the group envisions a terminal with a capacity of around 500,000 bushels (about 13,000 tonnes). Depending on the size and the kind of equipment installed, it would likely cost around $4-$6 million, which would be financed by a combination of share proceeds, borrowed funds and an operating agreement with an established grain company.
The exact location of the terminal has yet to be determined. The board has been looking at seven possible sites along the CP Rail main line between Swift Current and Tompkins, about 23 km west of Gull Lake.
