One year to the day after it shipped its first unit train of western Canadian grain, GrainsConnect signed a joint venture agreement to build a new export terminal at the Port of Vancouver.
The company, which is itself a joint venture between Australian grain giant GrainCorp and Japanese co-operative Zen-Noh Grain, is rapidly establishing a footprint in western Canadian agriculture.
The 50-50 joint venture is with Parrish & Heimbecker. Together they are building the Fraser Grain Terminal, which is expected to have the capacity to export four million tonnes of grains, oilseeds and pulses per year.
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“They were building a facility that had excess capacity, so I think they were looking for the right partner and we were fortunate enough to be that partner,” said GrainsConnect president Warren Stow.
“They were looking for tonnes and we had tonnes and we were eager to partner with them.”
The project is scheduled for completion in December 2020.
Finding spare capacity at the Port of Vancouver is exceedingly difficult. Fraser Grain Terminal will be the second new grain export terminal built at the port since the 1960s.
“This is super exciting for us to have the opportunity to have west coast capacity,” said Stow.
“It feels really good for us.”
GrainsConnect owns inland grain terminals in Maymont, Sask., and Redford, Sask., and will open two more in Vegreville, Alta., and Huxley, Alta., in 2019.
Those four facilities combined will be able to supply the Vancouver terminal with one to 1.5 million tonnes of grain annually. GrainsConnect’s share of the export terminal’s capacity is two million tonnes, so there is room to grow.
“It does give us the opportunity to expand that footprint if that’s the way we choose to go,” said Stow.
The company is currently shipping crops south, east and west. Once the terminal is constructed, almost all of the product will be flowing west to markets in China, Japan and Southeast Asia.
The grain will be marketed by the parent companies. Zen-Noh is the biggest consumer of canola meal and feedgrains in Japan while GrainCorp is “extremely strong” in shipping milling wheat to Southeast Asia, is the fourth largest maltster in the world and is also a big player in the feed barley trade.
Stow said the export terminal will give the company one of the most efficient supply chains in Western Canada.
GrainsConnect’s inland terminals are all equipped with loop track systems, the company has its own private cars and those cars will be unloaded directly into storage at the Fraser Grain Terminal, which is located at one of the least congested areas of the port.
Each inland terminal will have its own set of cars. A round trip to the West Coast and back is expected to take seven to 10 days.
Stow believes that GrainsConnect’s inland terminals will not be as affected as others when the weather gets miserably cold because they employ the power-on model of grain loading.
That is where the rail cars are left attached to the engine throughout the loading process, which means there will be no delays in powering up and getting air pressure to the brakes. That was one of the big problems during the 2013-14 rail crisis.
A 130-car unit train can be loaded in 10 hours using that system.
