An American crushing firm is making it easier for southern Manitoba farmers to deliver canola to it.
Northstar Agri Industries of Hallock, Minnesota, is building a new 1,500-tonne high-throughput facility at Winkler to receive, store and transload canola. The operation, due to open this fall, will employ two or three people.
“The demand for (canola) seed, we’d say, has almost forced us into a facility up in Manitoba,” Zack Schaefer, Northstar’s senior grain originator, said in an interview Aug. 28.
“We’re building the facility up there to better serve our growers, so they don’t have to deal with as much border issues and paperwork.”
The new facility will be able to unload 17,500 bushels an hour.
Schaefer suspects most farmers will earn more delivering to Winkler than Hallock because Northstar can secure lower freight rates.
Canola delivered to Winkler will be trucked to Hallock, about 115 km away.
Northstar, which is licensed and bonded by the Canadian Grain Commission, opened its 1,100-tonne-a-day canola-crushing plant in 2012 and is expanding to 1,400 tonnes. It purchases more than 400,000 tonnes of canola annually.
The plant has capacity to produce 114 million pounds of food-grade canola oil a year and 289,000 tonnes of meal, much of which goes to feed dairy cattle in the U.S.
Hallock, which is located on the eastern edge of Northern Plains canola production, is able to compete in part because it has a state-of-the-art plant. A stronger American dollar also helps, Schaefer said. “There’s a lot more supply than one plant can use right there.
“The U.S. is a net importer of canola oil, so most of the customers are in the U.S,” he said.
“Customer service is a big thing. Price is a big thing.”
And while there are a number of Canadian crushing plants to compete with, including at Ste. Agathe and Altona, Canada still exports canola seed, Schaefer noted.
The Winkler facility, which will operate Monday to Friday, year round, will feature a high-speed, 17,500-bushel-an-hour unloading system, and serve as a delivery point for Northstar’s Star Growers Premium Priced Contracts.
Farmers who grow from a list of pre-approved, high oil-producing canola varieties, are eligible for a five per cent price premium on the first 25 bushels an acre produced under a Northstar contract, Schaefer said.
The following are the approved varieties: Pioneer 45H29, Pioneer 46H75, InVigor L252, DK 73-75RR, DK74-44BL and Proven VT 530 G.
Under its new Variable-Rate Technology program, canola growers can earn another one per cent. To qualify, farmers have to take grid soil test samples for nutrients, map the results and then apply their fertilizer at the rate required. Variable-rate fertilizing is considered better for the environment because it attempts to match crop needs with the amount of nutrients applied.
“A lot of our (canola) oil customers like sustainability,” Schaefer said. “We’re being front-runners in doing so on the buying side.”
Canadian canola is important to Northstar’s operation. Last year it made up 65 per cent of the company’s supply and most of it came from Manitoba, Schaefer said.
This year Northstar projects about half of the canola it buys will come from Canada and the rest from the U.S. “but that’s yet to be seen,” he added.
Canola production has been flat in Minnesota, but Northstar sees the potential for it to grow there. Meanwhile, canola plantings have increased in bordering North Dakota. This year farmers in Cavalier County, in the Langdon area, seeded 280,000 acres of canola, Schaefer said.