“I think that this year, because of the kind of moisture problems we’ve had, I think we’re going to have to go farther afield and probably more into that Manitoba marketplace than we would normally do.”
– Curt Vossen
Abreak in the endless downpours plaguing Saskatchewan recently lasted just long enough for Richardson International to inaugurate its new $170-million oilseed plant near Yorkton.
However, just minutes after the speeches and ribbon cutting were over, the skies opened up with another bone-drenching gusher that even knocked out power downtown.
But this spring’s nightmarishly wet weather won’t pose a setback for Richardson International’s flagship plant, according to president Curt Vossen, who was on hand for the ceremonies.
“I think that this year, because of the kind of moisture problems we’ve had, I think we’re going to have to go farther afield and probably more into that Manitoba marketplace than we would normally do,” said Vossen, during a question-and-answer period.
In drawing up plans for the facility that began in 2006, which has an identical twin owned by Louis Dreyfus Canada Ltd. (LDM) also in Yorkton that opened last fall, canola for the plant was to be sourced mainly within 100 km from the plant, as well as “pockets” and “backhaul” areas farther away.
Doubters have questioned whether there would be enough canola to feed both plants when plans were announced by both companies on the same day four years ago, but Vossen insisted that their location in the top canola-growing area of the Prairies will mean ample supplies for both.
“I have been asked that question many times over the last four years,” he said. “We did the numbers, we looked at the grid of the catchment area. Also, because of where it’s located relative to seaboard, it’s the least attractive for exporting the product out of Canada as a raw material.”
Two Class 1 railways serving Yorkton, along with “great” road infrastructure consisting of three converging highways, means that “without doubt, or any equivocation” there will be plenty of canola for two plants, he added.
This spring’s “unprecedented” deluge has hit the Yorkton area especially hard, but the grain giant’s vertically integrated operations across the Prairies mean that Richardson will be able to draw enough canola from relatively drier areas in Manitoba and Alberta to keep the plant running.
“We still think this is a 15-million-plus-acre crop in Canada this year, after you take into account the unseeded acreage and the drownout and washout areas right across the Prairies,” said Vossen, adding that the figure is still high, even if it is down from the 16 million to 18 million acres previously predicted.
“I think the acreage is well sustainable for the crushing industry.”
Farmers with seeded acres will benefit from higher yields due to adequate moisture, and prices will be pulled upward by the additional crushing capacity which will create significant new demand for raw materials, he added.
The plant, with its own rail siding and 375 brand-new, leased cars, can crush 2,400 tonnes of oilseeds per day or 840,000 tonnes of grain per year. With 70 full-time employees, it is currently running at 50 per cent capacity as shipping side automation details are perfected.
Oil is mainly destined for the North American market, where demand for canola oil as a healthier frying option has been growing by three per cent a year. Partially refined products such as super de-gummed oil will find markets in the Far East, added Vossen.
Canola meal shipments are already going out, mainly to the United States dairy market where the co-product of canola oil production is highly valued as a milk-production-boosting feed supplement.
In his comments, Hartley Richardson, chairman, and seventh-generation heir of the 153-year-old company, said that the company’s decision to go ahead with the state-of-the-art plant even amid the “storm clouds” of financial crisis in 2008-09, shows its commitment to the Canadian industry.
“My grandmother told me that it does help when you have a little grain dust in your blood,” said Richardson.
“It is that confidence in this industry that got us through good years and bad years, as it has for all the producers and customers that we deal with.” [email protected]