CALGARY – There is strong growth potential for the Canadian flour milling industry if it is innovative and efficient, an American flour milling industry expert said last week.
If Canadian per capita consumption of flour grew just half a kilogram from its current 60 kg level during the next 12 years, it would create a 26 percent increase in the milling sector, Morton Sosland told a Canadian Wheat Board-organized conference on value-added industry.
The editor-in-chief of the industry bible Milling and Baking News said such growth, conservative by recent expansion levels in the United States, is possible if consumers continue to look to grains-based foods for healthy eating, and if the industry is creative.
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A key will be “the success of the industry in developing new products,” he said.
Such a growth in demand would increase Canadian flour production by 370,000 tonnes to 2.18 million tonnes by 2010.
However, Sosland warned the Canadian flour-milling industry, now two-thirds foreign owned, not to expand with the assumption that excess production can be shipped to the United States.
“I assume that Canadian investors in new cereal grain processing facilities would want to look mainly to markets south of your border,” he said. “All I could add to such thinking is that U.S. millers don’t see the need for Canadian supplies and will certainly be mean competitors.”
Both Canada and the U.S. have lost most of their export markets in recent years because of subsidized competition, primarily from the European Union.
Meanwhile, he said that after decades of decline, the American flour milling industry now is booming and expanding, creating new domestic markets for wheat and preparing for major investments.
The American industry expert attributed the boom to a changing ethnic population, different consumer eating habits and a decision by the U.S. government in 1990 to encourage Americans to dramatically increase their consumption of grain-based foods as part of a healthy diet.
In the past quarter century, U.S. flour sales have increased 74 percent to 17.6 million tonnes. Since 1985, the growth has escalated far faster than demand has risen in neighboring countries, including Canada.
Sosland said he gives the American flour industry little of the credit.
Instead, growing demand for flour-based “ethnic” foods like pizza and tortillas, steady population increases and the new government nutrition seal-of-approval have made grain-based products popular.
There has been no greater turn-around than in the demand for bread, he said.
“Prior to the 1970s, bread often was seen as a food to be shunned,” he said. “Mothers were ashamed to feed it to their children. The nearly absolute reversal of that attitude is a great miracle. It is the cornerstone of consumption growth.”
Sosland told the wheat board conference that the domestic milling industry holds out the promise of being a growth area for the wheat sector for the foreseeable future.
