Medicine Hat facility | Closure comes as Archer Daniels Midland realigns operations
A century of flour milling operations will end in Medicine Hat when Archer Daniels Midland closes its landmark facility at the end of May.
The mill’s 40 employees were told of the plan at the end of January. Although it was unwelcome news, it was not entirely unexpected.
“We had suspected it was coming for about the last seven years,” said Ben Hermann, a 33-year employee at the mill.
“They kept trying to move equipment to Calgary, but customers didn’t like the Calgary flour. They preferred our flour.”
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Jackie Anderson, spokesperson for ADM in Decatur, Illinois, said the company is closing the mill to optimize its milling operations.
“The decision had nothing to do with the quality of work being done in Medicine Hat,” she said in an email.
She said customers will continue to be served from ADM’s Calgary mill, where warehouse space and more packaging capability will be added to accommodate the changes.
The Medicine Hat mill will be gradually idled and then closed at the end of May, Anderson added.
“We are considering our options beyond that.”
Hermann, who is the unit chair for United Food and Commercial Workers Local 1118, acknowledged ADM would likely be reluctant to sell the mill to a competitor, but he doesn’t want to rule it out.
“We are sort of hoping somebody might step in and buy the place because we’re profitable and all of our customers like us and our product,” he said.
“There’s a lot of pride and effort in our work.”
Hermann said ADM officials told employees that the larger Calgary plant was not running at capacity, which was one of the reasons for the change.
As well, the Calgary plant can process hard red spring wheat, soft wheat and rye, while the Medicine Hat facility processes only hard red spring.
He said the mill has been recognized in the past for its ability to extract up to 80 percent value from each kernel of wheat.
It produces 12 products ranging from various types of flour to bran, wheat germ, wheat granules and feed.
The current employee contract expires at the end of February, and Hermann’s union duties will now entail severance package arrangements and other assistance to employees.
“It’s slowly starting to sink in. Some of the guys, they are in their 50s, so it’s sort of hard to step out and find another job. Not too many places are looking for 50-year-old people,” he said.
“And we’re all pretty close knit. We’ve worked together for years.”
Lisa Kowalchuk, executive director of the Medicine Hat Chamber of Commerce, said the unemployment rate in the region is low, which bodes well for mill workers who will soon be looking for jobs.
However, news of the closure was disappointing.
“It is disheartening when you see a business close after they’ve been in existence for 100 years,” Kowalchuk said.
“It’s certainly not something that we want to see, but we also understand that certain businesses have to make business decisions and we certainly can’t comment as to what affected their decisions or what had transpired to come to that conclusion.
“It obviously does have an economic impact on our community.”
ADM declined to provide data on the capacity and output of the mill, but Hermann said it produced 390 tonnes of product per day for customers in British Columbia, Quebec and Alberta.
The facility has a rail car siding and there are two gas wells on the property.
ADM has owned the plant since 1992. It began its life in 1912 as Ogilvie Flour Mills Co., which was well known for its Five Roses Flour brand.
ADM reported second quarter earnings Feb. 5 of $510 million, or 77 cents per share. Much of that came through its oilseed crushing operations, which include a plant in Lloydminster, Alta.
