Minneapolis grain dealer Ceres Global Ag has made a deal to take its Prairie elevator network a step further northwest.
The company announced Thursday it has an agreement in place to buy Cargill’s elevator and “associated assets” at Nicklen Siding, about 30 km north of Tisdale in northeastern Saskatchewan.
The elevator, on Canadian National Railway (CN) track near the intersection of Highways 35 and 335, has handling capacity of about 13,100 tonnes after its expansion from about 5,700 in 1999.
Terms of Ceres’ deal with privately-held Cargill weren’t disclosed, except that Ceres plans to pay for the purchase with “existing working capital”and the two companies expect to close the sale by the end of August.
Ceres said it will also assume Cargill’s open grain purchase contracts and the elevator’s current staff will continue to work for Ceres.
Ceres’ Prairie grain handling and processing assets so far include the Manitoba facilities it took over when it bought Delmar Commodities in August last year, plus its grain export terminal on the U.S. border at Northgate, Sask., southeast of Estevan.
Its Canadian assets also include a terminal on the Welland Canal at Port Colborne, Ont.; 25 per cent of Saskatchewan shortline Stewart Southern Railway; and a 17 per cent stake in Canterra Seeds.
Its U.S. grain operations include a Lake Superior terminal at Duluth, grain terminals at Minneapolis and Shakopee, Minn. and a joint venture with Consolidated Grain and Barge in a terminal at Savage, Minn.
With the Cargill deal, “we take another meaningful step in our broader strategy to increase core product origination directly from growers in important regions,” Ceres CEO Robert Day said in the company’s release Thursday.
The northern Saskatchewan region, he said, “is critical for Ceres due to the highly efficient grower community, its product mix and competitive access to our terminal assets and customers.”
The deal would also effectively take Cargill out of northeastern Saskatchewan as a grain handler. The agrifood firm’s next closest elevators for growers in that part of the province are at Yorkton or at Clavet, just southeast of Saskatoon. — Glacier FarmMedia Network