OTTAWA (Staff) – Prairie grain companies are poised to invest more than $1 billion to revitalize their handling systems during the next decade, according to Cargill Ltd. president Kerry Hawkins.
The money will be spent to upgrade and build a core system of elevators to replace the existing, broader-based handling system, he said.
“I think by the year 2005, we won’t have more than 600 elevators in Western Canada from close to 1,500 now,” he said. “Those 600 are going to be handling twice as much grain as they do today, so we’re talking big-time money here. We are talking a billion plus.”
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Hawkins was commenting after he gave a speech to the Canada Grains Council semi-annual meeting that called for government and the industry to work toward a doubling of capacity within the decade.
This is the “vision” of the seven major grain companies, supported by Ottawa, he said.
To get there, the companies must be willing to invest heavily in new country and terminal elevators and the government must be willing to end the regulatory and policy uncertainty that now restrains their investment decisions, he said.
Hawkins predicted more co-operation and policy agreement among such traditional political adversaries as Cargill and the prairie pools.
Pressure to end uncertainties
On issues as varied as grain transportation subsidies and regulation, he predicted more industry agreement. And it will mean more industry pressure on the federal government to end the subsidy, marketing and regulation uncertainties, he said.
“I don’t think any of us are looking for grants or help,” he said. “I would adamantly oppose any government assistance with this …. But if we can get everyone in the industry to agree on what we want, we then will have the ability to say to politicians and decision-makers ‘this is what we want. If you aren’t prepared to accept it and give it to us, then get out of there and let someone else in’.”
He told the grains council that if governments and the industry make the investments and policy changes needed to allow Canada to take advantage of growing markets, the future is bright for prairie farmers.
