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Editorial: Provincial benefit

There isn’t even a firm proposal on the table and already folks are lining up to argue over where any future soybean-crushing plant should be built in the province.

Among the first out of the gate was a group in western Manitoba, that last year commissioned a feasibility study on the concept of building the plant in that region.

Initially the thought might not seem to make sense — after all, most of the province’s still-small soybean harvest comes from the Red River Valley.

However, this group of business, farm and civic leaders point out the crop is escaping that cradle and steadily marching westward. The region also offers a ready and growing market for soybean meal in the hog sector, they add.

News of the upstarts, it would appear, hasn’t been well received in the spiritual and physical home of soybean production in Manitoba. Many in the Red River Valley point out the lion’s share of the acres remain here and are likely to for the foreseeable future.

Inevitably the Manitoba Pulse and Soybean Growers Association has been pulled into the rivalry, with some quietly suggesting MPSGA has a clear preference in location. The perception has grown strong enough that MPSGA has publicly clarified that, as an organization, it strongly supports building a plant, but remains agnostic about its location.

It’s inevitable that parochial sentiment would creep into any talk of plant location. But right now this looks like a serious case of putting the cart before the horse.

Most analysts will tell you that, for a modern plant of the size and scope necessary to be economically competitive, Manitoba’s total provincial soybean production needs to grow.

In his article, reporter Allan Dawson details that a 3,000-tonne-per-day plant is basically the bare minimum, with anything smaller than that struggling. Even a proposed North Dakota crusher, with a planned size of 3,400 tonnes per day, is considered to be “on the small side.” One plant currently under construction in Brazil is set to process 5,000 tonnes a day.

The nearby North Dakota proposal, which is the most helpful comparison, would absorb about 1.24 million tonnes of soybeans every year. Manitoba is expected to produce a grand total of 2.2 million tonnes of soybeans in 2017, according to StatsCan numbers from its August field crop report.

No company will want to be in a position where it is consuming half the available raw material in any geographic region. If soybean producers want to see a plant on the ground here, growing the annual acres, and protecting that expansion, is the important first step.

For farmers in Manitoba and Saskatchewan, that means agronomic research to perfect the production system for our climate, soils and weed and pest spectrum. It requires a concerted effort and groups like the MPSG are already well down that road, funding and directing research and doing extension work with growers.

Naturally, the association contributed to the WestMan study, as it has considerable knowledge and expertise in the sector; it should be at that table. It’s unfortunate this group, which represents the interests of all growers, has been tainted by the controversy.

As MPSG’s executive director Francois Labelle notes in the news story, the real truth is Manitoba isn’t competing with itself. The province is competing with other provinces, states and far-off countries such as Brazil and China.

He’s also correct when he notes the companies that build these plants are looking at where they’ll get their best return globally. The decision won’t be made in a boardroom in Manitoba; it will be based on finding the best fit for the company’s objectives. Sometimes, the factors that make that determination can be unexpected.

For example, Roquette chose to build its pea protein facility in Portage la Prairie, despite the fact this province produces very few peas relative to Saskatchewan.

Those familiar with the company’s decision say two factors that weighed in were Manitoba’s relatively low-cost hydroelectricity and the province’s robust French-speaking community, which is an attraction to the French company’s managers looking at relocation to North America.

Instead of descending into regionalism, the industry’s best bet is to make Manitoba an attractive destination for any new plant, which will in turn keep soybeans thriving here.

That’s going to require everyone in the sector pulling together, rather than drawing apart.

About the author

Editor

Gord Gilmour is Editor of the Manitoba Co-operator.

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