MAYMONT, Sask.-Organic producers will pool their resources and steer clear of heavy debt loads at a new organic seed cleaning and processing plant in this west-central Saskatchewan community.
The Northwest Organic Community Mills Co-operative Ltd. plans to start cleaning seed in December and begin secondary processing early in the new year in the former Maymont school gymnasium.
The cleaning plant and mill will process up to 500,000 bushels of grain, oilseeds and pulses annually.
Total project costs are $455,000, with the new generation co-op planning to raise as much as $326,000 through a share offering.
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The remainder comes from donated labour and supplies and government grants. Grants paid for the feasibility and marketing studies and the creation of a business plan.
The co-op has kept costs to a minimum and avoided bank loans by buying the school for $16,000, refurbishing used cleaning equipment and contributing volunteer labour to the construction.
“If we get $240,000, we are up and going,” said co-op president Dale Beaudoin, an organic farmer at Maymont. The group has already raised $135,000 and plans an aggressive share offering campaign this fall to double that.
With this year’s harvest in the bin, Beaudoin said the 10 members can now focus on completing the installation of bins, elevating legs and dust collectors in the plant.
The next task will be lining up people to do the marketing and plant operation.
Co-op vice president Darryl Amey of Radisson said the plant has a relatively small price tag, similar to the cost of a large, modern combine. Share costs range in price from $300 to $1,000.
“We will try to get this up and running with as little debt as possible,” said Amey.
He said the plant will give organic growers opportunities to pool their grains and fill B-train-sized orders. The plant will also be small enough to offer smaller amounts in bags.
Amey processes all the cereals, peas and lentils from his 160-acre farm at Radisson into products like oat flakes for local consumers.
He hopes this plant can build on his type of operation and is offering his expertise to launch the processing wing.
“This is an opportunity to be involved in what I do at home but far beyond that scale,” he said. “We can work together, pool together to access larger markets. We really see the advantage of working together,” said Amey.
“One individual doesn’t have to wear five different hats. So many in agriculture are doing so many things they’re not suited for.”
Amey, also a member of the provincial Action Committee on the Rural Economy, said this plant fits with that group’s goals to revitalize rural Saskatchewan. It also fulfils his and other growers’ goals of creating rural-based enterprises that take food production back from big business.
“It retains the wealth generated from primary agriculture,” said Amey.
The co-op is not deterred by the failure of the multimillion dollar FarmGro Organic Foods Inc. at Regina last year.
Much has been learned from that plant’s mistakes, said Beaudoin, an investor in that enterprise and an organic cattle and grain producer for 15 years.
“There was too much debt,” he said.
The Maymont plant will maintain a low debt load, with the cleaning plant’s revenues paying the day-to-day operating expenses.
Farmers will maintain ownership of their product until it is sold. Members will bring their crops to the facility and have their own storage bins on site.
Priority will be given to processing members’ grain but the co-op will also offer a fee for service to other organic producers.
Beaudoin noted the plant’s advantages in handling “odds and ends” left in farmers’ bins and in its location close to two major highways and numerous organic producers. The local chapter of the 80-member Organic Crop Improvement Association includes the Maymont region.
Amey said this plant could also play a role in co-ordinating and distributing seed stocks and finding markets for older grain varieties.
There are also opportunities to sell feed grains and screenings to organic livestock producers.
Brian Reiley of Richard, Sask., switched to producing cattle, cereals, lentils, flax and buckwheat organically because he wasn’t making money in conventional agriculture.
He is confident demand will outstrip supply and said the plant will allow producers to get closer to consumers.
“We need to be the middleman to make money,” said Reiley. “The more things you do and the more you take it down the line, the more money you make.”
Beaudoin believes farming’s future lies in value-added crops: “My philosophy is that we should be value-adding to our products rather than expanding our land base.”
The plant will do secondary processing as sales orders come in to maintain fresh product and avoid extended storage. A retail outlet is also planned for the former classrooms, now used for storage.
