The first length of strawboard has yet to roll out of the press at Isobord Enterprises Inc.’s plant at Elie, Man.
But company officials are already shopping around for other sites for a second, similar $150 million plant.
Isobord’s board of directors won’t decide whether they’ll build another plant until they are certain things are working well at the flagship Elie plant.
Terry Perkins, chief financial officer, said construction is almost finished. The plant should start producing particleboard made from pressed wheat straw and glue in June. Isobord will be at full production by the end of the year, he said.
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“Things are on schedule, and maybe a bit ahead of schedule.”
By fall, the company will determine whether and where it will build the second plant, and start breaking ground next spring. It is compiling a short list of locations.
“If things work, we can make a decision in a hurry then,” said Perkins.
So far, the plant has heard from interested towns in Manitoba, Saskatchewan, Alberta, North Dakota, South Dakota and Kansas. Perkins declined to name specific communities.
Several will be making formal proposals after touring the plant in the past six weeks. Some have been keeping an eye on the company for two or three years, said Perkins.
“They know that we’re serious and they’re very interested in us.”
Building in Manitoba would let the company share some managers and supplies of spare parts, cutting overhead.
But building in the United States would let the company take advantage of the different harvest seasons and use its fleet of high-tech baling equipment at both locations.
Potential suitors need good rail service and a road network, a strong local labor pool and natural gas.
But most importantly, they have to demonstrate they have the support of farmers within 55 kilometres of the potential site, since the plant would need almost 200,000 acres of wheat straw each year.
“We’d want to see a fair commitment for at least half of that before we even consider a particular location as being serious,” said Perkins.
“We can build a plant anywhere in the world, but we want to build it close to the straw, and that’s the real key here.”
This year, farmers around Elie who belong to a straw producers’ co-op will sign up 150,000 acres of straw, enough to produce 300,000 bales.
Isobord had pre-sold 80 percent of its expected production before the plant was built. The company wants to build five or six plants in the next seven or eight years.
