Glacier FarmMedia COVID-19 & the Farm

Viterra to buy Manitoba canola crusher

Revised, June 15 — A “cold-press” canola crushing plant in southeastern Manitoba is the latest acquisition for Canada’s largest grain company.

Viterra announced Monday that it will buy the Associated Proteins plant at Ste. Agathe, Man., about 25 km south of Winnipeg on the west bank of the Red River, for $64 million plus “working capital.”

Pending approval from the federal Competition Bureau, the company said it expects the sale to close June 25.

The Associated Proteins facility has a crush capacity of 1,000 tonnes per day, and “with immediate access to North America’s major rail lines, is well situated to source raw materials domestically and supply North American end-use markets,” Viterra said.

Viterra described the facility on the west side of Ste. Agathe as “a scalable operation with future growth and expansion opportunities to service the growing markets for healthy vegetable oils.”

Unlike convention canola crushing, which uses solvents to extract as much oil as possible from the seed, cold-pressing uses only mechanical expellers, leaving a higher-oil, high-energy meal as its byproduct. The Ste. Agathe plant remains the largest of its kind in the world.

The Regina grain company said it expects “significant growth” in canola oil sales as canola replaces soy oil in food applications.

Karl Gerrand, Viterra’s senior vice-president for food processing, said in an interview from Ste. Agathe Monday that the company is still considering whether to continue cold-pressing or convert the plant to conventional hexane extraction, though he said the company doesn’t foresee any technical roadblocks at the plant if it were to decide on the latter.

Gerrand added, however, that Viterra considers the current operation to be a “premier supplier” of cold-press oil to North America’s health-conscious consumers.

Viterra’s CEO Mayo Schmidt said in a release Monday that the acquisition “bolsters our presence in food processing and complements our position as Canada’s leading canola exporter” and “is consistent with our overall strategy to grow our company’s value-added capabilities.”

“Through this transaction, we will be able to further leverage our value chain to meet increased crush demands and supply an expanding healthy vegetable oil market,” Gerrand said in the same release.

The Ste. Agathe plant’s management and staff have “an impressive track record of execution and we look forward to working together to grow the business and its customer base,” Gerrand said.

The Associated Proteins plant rose in Ste. Agathe in 1998 under the ownership of a Kincardine, Ont. company, Canadian Agra, which pledged to develop markets for its “cold press” canola oil.

Under Canadian Agra’s ownership, however, the Ste. Agathe plant was mothballed without ever getting a bottle of oil on store shelves. Ellis-Don, the general contractor for the plant’s construction, wound up as its owner, and entered a partnership with Associated Proteins in 2004 to restart production.

Associated Proteins took full ownership of the plant in 2005 and by 2006 was considering plans to double its processing capacity to 2,000 tonnes of canola per day.

Gerrand said Monday that Viterra also hasn’t yet made any decisions on whether or when to proceed with expansion, though he reiterated that the facility is “well suited” to do so.

Associated Proteins briefly made headlines outside the business pages for an explosion and fire in one of its press-cake coolers in April last year, temporarily halting production at the plant.

COPA Medallion COPA finalist in 2012, 2014 and 2015.
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