The federal and Alberta governments are set to cover over $22 million in costs related to the construction of Cavendish Farms’ new potato processing plant at Lethbridge.
The two levels of government on Monday announced $20 million for the City of Lethbridge for related municipal infrastructure developments, through the federal/provincial Clean Water and Wastewater Fund and Alberta’s Capital Plan.
Through the federal/provincial Growing Forward 2 funding framework, the two governments will also put up $1.88 million for pre-engineering studies and “other purposes,” the province said.
Alberta’s economic development and trade ministry has also pledged over $1 million through its Community and Regional Economic Support program, going toward the Lethbridge Agri-food Processing Capacity Development project and the Lethbridge Airport Master Plan.
The funding for the infrastructure upgrades in Lethbridge’s Sherring Industrial Park follows talks between the city and the province after the plant’s construction was announced in December.
Moncton-based Cavendish, the potato arm of J.D. Irving Ltd., announced at that time it would build a $360 million frozen potato processing plant to more than double its Lethbridge capacity and replace the aging York Farms plant there.
The new plant, expected to be complete by summer 2019, would replace a 142,000-square foot plant that has operated since the mid-1950s. Cavendish bought the facility from Maple Leaf Foods in 2012.
Monday’s announcement was made during the official groundbreaking for the new plant, which is expected to create demand for an additional 9,000 acres of potatoes, the province said, pegging the crop’s per-acre value in the $3,500 to $4,000 range.
Cavendish is one of several major players in southern Alberta’s potato market. McCain Foods has a plant at Coaldale, about 15 km east of Lethbridge, while Lamb Weston and Frito Lay Canada operate plants at Taber, about 50 km east.
McCain in July announced capacity expansion work at the Coaldale french fry plant, to be completed this fall, as part of that company’s “global capacity investment program.” — AGCanada.com Network