Many of Manitoba’s hog barns are surrounded by soybean fields, but the soymeal inside them may have come from hundreds of miles away in the U.S.
That prompted Keystone Agricultural Producers members at their recent summer advisory meeting here to support the Brandon Chamber of Commerce’s efforts to encourage industry to construct a soybean-processing plant in the region.
“I advocate for any value adding that we can add to the province. I think that it is good for farmers and if there is the opportunity with the Brandon Chamber of Commerce to advocate on behalf of this, I think we should (support the resolution),” said Dustin Williams, a Souris-area producer who moved the resolution.
“With the expanding soybean acres in Manitoba and probably into Saskatchewan here shortly, I think Brandon is a good region for this and I think that it is fitting that we are here today in Brandon to pass this resolution,” said seconder Simon Ellis, who farms just north of Wawanesa.
The Brandon Chamber of Commerce had been advocating to attract the development of a processing facility two years ago.
“I think the resolution that was adopted at the KAP meeting was based on a project that was undertaken a few years ago. There hasn’t been a lot of activity on it at this point,” said Terry Burgess, Brandon Chamber of Commerce president. However, Burgess says they are happy to see any commitment by KAP to support growth in the region.
“The desire to encourage agribusiness in WestMan and in Brandon is truly appreciated. I think collectively if we can put our heads together and work together, perhaps we can make a difference on some of these larger projects,” Burgess said.
While the idea of a processing plant had general support, the location didn’t necessarily.
“I would like to support this resolution, my problem is, what about Carman? What about Winnipeg? What about Dauphin?” said Ernie Sirski of Dauphin, who was also a director of the Manitoba Pulse and Soybean Growers. “I want this soybean-crushing plant to be in Manitoba. That is my first and foremost, but I will have trouble supporting this resolution with a named location.”
Williams, who spoke on behalf of KAP’s District 7, said they aren’t necessarily tied to the Brandon location but rather saw movement on the project by the Chamber of Commerce and wanted to get behind it.
“Our thinking was that because the Brandon Chamber has had movement on this that we should align with it rather than try to create a grassroots movement to put it somewhere else in the province,” Williams said.
In an interview, Manitoba Pulse and Soybean Growers executive director Francois Labelle said the MPSG also supports the concept and will support any community that looks to pursue the project.
“The association has taken the position that we want to see this in Manitoba; that is our goal. After that we will not take position on any specific location,” Labelle said.
“When we consider the high percentage of our soybeans that goes for export and in turn we import large amounts of soymeal for our animal-feeding industry, it would only make sense to process locally,” Labelle said.
In 2014, the MPSG contracted Mercantile Consulting Venture Inc., to conduct a feasibility study on bringing a soybean crush facility to Manitoba, which was released in March 2015.
The report concluded construction of a crushing plant would produce several net benefits for the province.
Soybean producers would have easier access to markets with the ability to bypass rail freight. Livestock producers would also gain a local protein feed supply at competitive prices.
A large-scale facility would create a number of local economic benefits, both by keeping margins within provincial borders and spinoff effects through additional tax income and construction in the building phase.
The feasibility states that the facility could create a pre-tax benefit of approximately $190 million annually.
“For the study a location needed to be used as a reference point for freight calculations etc. This by no means was highlighting or identifying the best location for a facility,” Labelle said.
The feasibility study examined Elm Creek as a location and took into account its proximity to production, rail lines, feed mills and end-users.
The location was noted to create strong competitive advantage due to the distance to U.S. crushing plants.
“A final selection of a location will need a much more in-depth feasibility study to identify rail service, road access, labour availability, supply of product and easy access to market for the meal,” Labelle said.
The report recommended it would be best if the plant were a ‘switch plant,’ designed to crush both soybean and canola, to allow the maximization of potential crush margins.
“This option still keeps the soybean crush margins obtained from Manitoba soybeans in the province, and maintains all of the positive aspects for grain and livestock producers,” stated the report.
Labelle said the study was conducted to get a better idea of what needs to be considered in order to bring a plant to fruition but they have no commitment to a set location or timeline at this point.
“We just want to see this happen in Manitoba, that is what is important. We partnered on the study to get people talking and get the interest in a facility and are hopeful it will happen in the future.”