Story Posted: September 20, 2007

Cargill to double processing capacity at Clavet

Cargill announces plans to double its processing capacity at its Clavet facility. Once this new plant is added the total canola crushing capacity at this facility will be 1.5 million tones per year. The new plant will be operational in November of 2008. Increased consumption of specialty oils (zero trans fat) and generic canola oil in U.S. and abroad is one of the main reasons Cargill is increasing its crush capacity.

(Copyright The Leader-Post (Regina) 2007) Aug 29, 2007 Cassandra Kyle

SASKATOON -- Cargill Ltd. announced plans Tuesday to double its canola processing capacity in Saskatchewan with a second plant in Clavet.

The company says the new canola processing plant will be built adjacent to the existing plant, which began operations in 1996.

Cargill would not say how much the new plant will cost, but it will create 25 new jobs, boosting Cargill's total employment to 150 full-time equivalent employees in the community about 30 kilometres east of Saskatoon.

Already boasting the largest plant of its kind in Western Canada, the new Clavet plant will increase Saskatchewan production to 1.5 million tonnes annually, with both plants processing 750,000 tonnes each year. A plan to expand the existing facility by 25 per cent, announced in July 2006, has been scrapped in favour of the new plant.

"After we started analysing the cost for the additional tonnage and what that would require, we said it makes more sense to build a new stand-alone plant right beside the existing plant rather than trying to tweak our existing facility," said Ken Stone, Cargill's Canadian oilseed manager, from Winnipeg. "It's a sizable stake in the province."

The company holds several long-term agreements to supply major food customers with canola oil, and with the popularity of specialty oils on the rise, such as high oleic canola oils that are low in saturated fat and have zero trans fat, the new plant will help meet demand. In addition to forecast North American needs, overseas buyers from Asia and Europe are playing a growing role in the market as well. Stone said the new plant will allow Cargill to participate in the growth of the market well into the future.

And with Saskatchewan holding more than half of western Canadian canola acres, Cargill expects that number to grow as the sector expands. Just this year, Saskatchewan farmers seeded a record 7.2 million acres of canola, according to a Statistics Canada survey, up nearly 20 per cent from the year before. When it comes to the central location of the site, Stone says it has advantages.

"When we first looked at construction at Clavet we did a pretty exhaustive search in Western Canada and really believed in the growth of the acres that would occur and the production that would occur in Saskatchewan. And then when it came time to expand or try to build somewhere else, we kept coming back to (the fact that) we believe we've got a very, very good site, if not the best site in Western Canada," he said. "We have access to railways, it's in the centre of production and we believe that there will be continued growth of the acres and the oilseed canola production in Saskatchewan in the years to come."

Cargill also believes that as Saskatchewan demand for biofuel products grows, the company's role will develop in that industry as well. Judie Dyck, executive director of the Saskatchewan Biofuels Development Council, said confidence in Saskatchewan canola is leading to larger projects.

CanWest News Service

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