Saskatchewan, Manitoba and North Dakota are fighting to land James Richardson International’s proposed canola crushing plant.
Whichever location gets it will end up with a plant that is expected to use 840,000 tonnes of canola a year, cost $100 million to build and employ 60 to 70 people, making it the biggest canola crushing plant in North America. It could consume about 10 percent of Canada’s canola crop and create a high priced market for local farmers.
“We have a basket of opportunities that we think we can provide,” said Saskatchewan deputy premier Clay Serby, who has been negotiating with JRI for six months.
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“We think the leg-up we have on others is that we have a very large canola acreage in Saskatchewan. We can increase that quite nicely any time that we need to in this province… Producers will respond, without any question.”
Serby said Saskatchewan should be seen as the favourite to land the plant.
Not so fast, says Manitoba deputy premier and agriculture minister Rosann Wowchuk. Manitoba has its own competitive advantages.
“I’m very hopeful that Manitoba could be the site,” said Wowchuk.
Manitoba has some of North America’s lowest energy prices, the province produces a large amount of canola, and there are good road and rail links in the canola-producing regions.
The North Dakota governor’s office did not respond to a call for comment, but is understood to also be negotiating with JRI.
When JRI officials announced plans for the new plant, which they hope to begin building by the end of this year, they said they were considering two locations in Saskatchewan, two in Manitoba and one in North Dakota.
Canola industry analyst Nolita Clyde of Ag Commodity Research said she thinks Saskatchewan has an edge on Manitoba because it produces so much canola.
But she said North Dakota has one ace that neither Canadian province holds: biodiesel subsidies.
If the biodiesel market is vital to JRI’s plans, then Canada’s lack of a national biodiesel policy may doom both prairie provinces’ chances.
“I wouldn’t be surprised to see it go to North Dakota if they want to do biodiesel at all,” said Clyde. “The subsidies are better there.”
Serby, Wowchuk and JRI officials said the grain company’s main site needs include the presence of at least two railways, access to affordable energy and gas, a sufficient water supply for processing, tax incentives and provincial help building connections between the new plant and the local transportation network.
A number of observers said last week that the Yorkton, Sask., area seemed a likely candidate for the plant because it is the centre of a major canola production area and has good road and rail networks.
“From a purely selfish perspective, as the MLA from Yorkton, I would agree that this would be the ideal spot,” said Serby. “But I just want to try to secure the site for Saskatchewan.”
To Wowchuk, landing the plant in Manitoba would affirm her department’s attempt to nurture value-added processing rather than focus on primary production.
“We would be very pleased if Manitoba was successful here,” said Wowchuk.
Farmers won’t have to wait long to find out who will be the lucky ones with a huge canola consumer in their backyards. JRI officials said they want to be able to announce the location by the end of the summer.
