By 2017, a new Quebec-based co-operative nitrogen fertilizer plant could be producing urea for customers across Canada and perhaps abroad.
In Quebec City last week during an international co-op summit, Québec’s largest co-operative joined forces with one of the world’s largest fertilizer co-ops in announcing plans to build a $1.2 billion nitrogen fertilizer plant on the south shore of the St. Lawrence River near Trois-Rivieres.
Coop Fédérée is joining forces with the Indian Farmers’ Fertilizer Co-operative to start construction by 2014, assuming permits are obtained, and to start product shipments by 2017.
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Officials involved in the project say it is too early to predict how much product will be produced annually at the proposed plant.
IFFCO, one of the world’s largest fertilizer co-ops with holdings in India, the Middle East, African and South America, will invest $200 million in the proposed plant. Coop Fédérée and the Quebec government also will kick in an undisclosed share of the cost.
Other investors are expected once the approvals and permits are obtained and construction starts in 2014.
“This will be the biggest international co-operative venture ever in Canada,” Coop Fédérée crop products manager André Mercure said in an interview. “It is an opportunity for our 62,000 members, for the Canadian farm community and for our Indian colleagues to benefit.”
He said product from the plant will be sold through CF retail outlets throughout Quebec, Ontario, the Maritimes, Manitoba and Saskatchewan.
Some product also could be shipped to India, which imports seven million tonnes of fertilizer annually.
One of the reasons for the IFFCO decision to join forces with Coop Fédérée in the project is the political and economic stability in Canada as well as the fact that the plant will be on the St. Lawrence River with ocean access.
Alistair Fraser, vice-president of business development for IFFCO Canada, said in an interview that direct exports of fertilizer to India may not be the plan.
The Indian co-op, with annual sales of $5 billion US, has invested in plants around the world.
“In large part, this is a financial hedge rather than a commodity hedge for IFFCO,” he said.
“There are lots of places where fertilizer is available, but if Egyptian fertilizer is coming to Quebec, it might be more logical to have this plant supply that local market and then have Egyptian fertilizer shipped to India,” he said. “There are different possibilities. But with equity in the plant, we can imagine all kinds of equity ratios.”
