The bureau announced Friday it had filed an application Thursday with the federal Competition Tribunal, seeking an order that grain handler Parrish and Heimbecker sell either its elevator at Moosomin, Sask., or an elevator it now owns about 60 km east, near Virden, Man.

Winnipeg-based, privately-held P+H announced in September it had made a deal to buy all 10 of the primary Prairie grain elevators built by agrifood giant Louis Dreyfus Co. between 1998 and 2003.

Those 10 included Dreyfus’ facility at Virden, along with sites at Aberdeen, Kegworth, Tisdale and Wilkie, Sask., Joffre, Lyalta, and Rycroft, Alta., Dawson Creek, B.C. and Rathwell, Man.

As a result of the deal, which closed Dec. 10, “P+H now controls both grain elevators along a 180-km stretch of the Trans-Canada Highway,” the bureau said.

“Before, the elevators in Moosomin and Virden were close competitors due to their proximity along this stretch of highway,” the bureau said, as the companies “closely monitored each other’s wheat and canola prices and responded to competitive activity from each other by offering farmers better prices.”

The deal “eliminates this rivalry,” meaning “farmers in the corridor between Moosomin and Virden will earn less for their wheat and canola.”

P+H now “has the ability and incentive to unilaterally exercise market power in the relevant markets,” the bureau said in its application. It said P+H already “no longer intends” to follow through on previous plans to expand its rail car spot at Moosomin.

The bureau’s application “seeks to protect farmers near Virden from suffering financially as a result of this transaction,” bureau commissioner Matthew Boswell said in Friday’s release.

‘Limited options’

Grain growers in and around the Virden-to-Moosomin corridor would be “left with limited options,” the bureau said in its application. For those growers, the next closest elevator would be the Viterra site at Fairlight, Sask., about 35 km south of Moosomin.

But that elevator, the bureau said, “is on a secondary road and, due to highway weight restrictions, farmers may pay more to transport their wheat and canola.”

The bureau’s application to the Competition Tribunal also seeks an order blocking P+H from buying any other primary grain elevator in the two “relevant markets” for five years from the date of the order.

No other Dreyfus or P+H elevator is mentioned in the bureau’s application to the tribunal — although in all, six of the Dreyfus sites are about an hour’s drive or less from at least one P+H elevator.

Of those, the closest together are at Tisdale, where Dreyfus and P+H both have elevators.

P+H also has an elevator at Yorkton, Sask., where Dreyfus owns a major canola crushing and refining plant that will continue to accept direct deliveries from canola growers, but the crush plant is not part of the deal with P+H. — Glacier FarmMedia Network

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Louis Dreyfus (LDC) announced Wednesday it has an agreement in place to sell its 10 elevators across Western Canada to Winnipeg grain company Parrish and Heimbecker.

The two privately-held firms said the financial terms are to be kept confidential on this deal, which they expect to close in the fourth quarter of this year.

P+H said the deal will allow it to offer farmer customers “increased access to more competitive offerings in grain trading, handling and merchandising, as well as full-range crop input products backed by leading agronomic solutions.”

Rotterdam-based Dreyfus, the “D” in the “ABCD” group of global grain industry players, has been a direct player in the Prairie grain handling business since 1998, when it announced it would “enhance” its presence in Canada and build its own network of primary elevators.

Over the following five years, that network was built up to include the 10 elevators at Virden and Rathwell, Man., Aberdeen, Kegworth, Tisdale and Wilkie, Sask., Joffre, Lyalta, and Rycroft, Alta. and Dawson Creek, B.C. The elevators run between 21,340 and 53,040 tonnes in capacity.

The deal announced Wednesday, however, will not include LDC’s 10-year-old Yorkton, Sask. canola crushing and refining plant — one of North America’s largest, at a crush capacity of about 3,000 tonnes per day.

LDC will also keep its St. Lawrence River grains and oilseeds terminal, a 292,950-tonne capacity facility it set up in the 1960s at Port Cartier, Que., about 60 km southwest of Sept-Iles.

Growers who deliver to any of the 10 Dreyfus elevators will still be able to use the company’s MyLDC mobile app to manage their contracts with LDC until the deal closes, a Dreyfus spokesperson said. Beyond that date, growers who deliver directly to the Yorkton crush plant will still be able to use the app with no changes to its current offerings.

“P+H has built a great business, an excellent reputation, and their culture and long-term vision are a good fit for LDC employees and farmer customers — a key factor in evaluating the transaction,” Brant Randles, president of LDC’s Calgary-based Canadian arm, said in a separate release.

The two companies’ elevator networks have little direct overlap — both have elevators at Tisdale, and P+H has an elevator at Yorkton — although six other LDC sites are about an hour’s drive or less from at least one P+H elevator.

LDC noted the deal’s closing is still subject to “satisfaction of regulatory requirements and customary closing conditions.” A Dreyfus spokesperson confirmed via email that the deal is subject to approval from Canada’s Competition Bureau.

P+H CEO John Heimbecker, in that company’s release, described the deal as “a win-win for farmers seeking a more competitive grain and crop inputs offering as well as for the stakeholders within P+H and LDC who work to support them.

“Acquiring geographically strategic assets from a global leader like LDC makes us better and stronger by an order of magnitude.”

Randles, in LDC’s release, said the company “remain(s) committed to this important market, connecting Canadian growers with local and international food markets with a greater focus on value-added processing.”

Dreyfus, like its fellow majors, has recently been up against reduced profits from sourcing and shipping grains and oilseeds due to burdensome global commodity supplies and the ongoing trade war between the U.S. and China.

The company in May was reported to be considering offering equity stakes to outside investors for the first time in its history. — Glacier FarmMedia Network

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Calgary-based GrainsConnect Canada, itself a joint Prairie grain handling venture between Australia’s GrainCorp and Japan’s Zen-Noh Grain, announced Wednesday it now has a formal 50-50 partnership agreement with P+H to build and operate the Fraser Grain Terminal at Surrey, B.C.

The deal, pending approval from federal competition regulators, calls for GrainsConnect to buy shares in P+H subsidiary Fraser Grain Terminal Ltd. The deal’s specific financial terms weren’t disclosed.

P+H executive vice-president John Heimbecker said Wednesday the new partnership “helps ensure (FGT) is ready for service in 2020.”

FGT, when launched in 2016, was billed as a joint venture between P+H and another privately-held Winnipeg grain firm, Paterson Grain.

P+H said it had explored involvement with Paterson early in the FGT project’s development but applied independently for the project permits; FGT remained wholly owned by P+H throughout that process, the company added.

FGT in November received its project permit from the Vancouver Fraser Port Authority. P+H then said it expected to start construction work on Dec. 3.

The new port terminal’s construction is now expected to take about 24 months, expanding an existing terminal with capacity for about 500,000 tonnes of annual throughput. Demolition of old buildings at the site was approved in June last year.

The expanded terminal is to include about 70,000 tonnes of storage capacity, for combined throughput of over four million tonnes per year, the companies said.

FGT will also have capacity to “rapidly” handle and discharge 120 rail cars and include three ship loader towers, which are expected to cut ship loading times by allowing “simultaneous” loading of multiple holds at about 2,000 tonnes per hour.

Crops loaded into the terminal’s silos would go mainly onto cargo ships, though the site will also have an “integrated” loading facility and container storage site to load rail cars and trucks to move grain to Fraser Valley customers, and containers for export via container terminals such as Deltaport.

FGT is expected to load about 80 bulk vessels a year, or about one to three vessels a week, including Panamax, Supramax and Handy-size vessels.

Most vessels would be fully loaded at FGT, though larger-class Panamaxes would be loaded to the maximum capacity according to guidelines for river draft (depth) and may be topped up later at deepwater terminals.

P+H has previously said FGT, when complete, will “improve loading efficiency, reduce rail shunting and dramatically improve rail car cycle times between the Prairies and metropolitan Vancouver.”

GrainsConnect launched in 2015 and has since built and opened grain elevators at Maymont and Reford in western Saskatchewan, with two more under construction at Vegreville and Huxley, Alta. for opening in spring and fall 2019 respectively.

Klaus Pamminger, GrainsConnect’s board chairman, said in a separate release Wednesday that FGT will connect its four elevators “directly to global customers, providing a highly efficient, integrated end-to-end solution.” — Glacier FarmMedia Network

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Prairie grain handler Parrish and Heimbecker announced Thursday it’s “moving forward” with the Fraser Grain Terminal project as proposed in late 2016, after receiving approval for its project permit last week from the Vancouver Fraser Port Authority.

The new export facility, to be built on port land on the Fraser River at Surrey, is expected to address “two major constraints” in the Prairie grain sector — “limited Western Canada rail capacity, and a shortage of port industrial land for grain handling,” the company said Thursday in a release.

FGT said on its website it now expects to begin construction work on Dec. 3, putting its target for completion at December 2020.

FGT, when launched in 2016, was billed as a joint venture between P+H and another privately-held, Winnipeg-based firm, Paterson Grain. FGT’s website, however, now bills the venture as a “wholly owned subsidiary” of P+H.

FGT’s plan proposes to add annual throughput of 3.5 million tonnes at the project site. Combined with the existing grain terminal at the site, it would bring its total annual throughput to four million tonnes. The current terminal is a joint venture with Fraser Surrey Docks.

The new terminal is to have three “state-of the art” shiploaders and a fully-enclosed above-ground conveying system, the company said.

Crops loaded into the terminal’s silos would go mainly onto cargo ships, though the site will also have an “integrated” loading facility and container storage site to load rail cars and trucks to move grain to Fraser Valley customers, and containers for export via container terminals such as Deltaport.

FGT is expected to load about 80 bulk vessels a year, or about one to three vessels a week, including Panamax, Supramax and Handy-size vessels, the company said.

Most vessels would be fully loaded at FGT, though larger-class Panamaxes would be loaded to the maximum capacity according to guidelines for river draft (depth) and may be topped up later at deepwater terminals.

Once the new terminal is up and running, the site’s existing facility will convert to handle only “pelleted protein products” and its existing mobile shiploader would be decommissioned.

The “modern design” of the new facility and shiploaders is expected to limit noise and dust from grain handling and will also replace an “aging and obsolete” warehouse on vacant port land that hasn’t been used for more than two years, FGT said.

“The leading design that P+H chose will improve regional efficiency and safety, and help reduce dust and noise in the local community,” Randy Roller of FWS, P+H’s designer and construction contractor, said in P+H’s release.

The new site will include a semi-loop rail track, realign an existing rail track and extend three existing rail holding tracks northeast of the main site, to reduce shunting during unloading, the company said.

A P+H representative said in 2016 the terminal will connect directly with Canadian National, Canadian Pacific, BNSF and Southern Railway of British Columbia lines.

In all, P+H said Thursday, the FGT project is expected to extend existing rail loading areas and allow for high-speed rail car unloading, which would “improve loading efficiency, reduce rail shunting and dramatically improve rail car cycle times between the Prairies and metropolitan Vancouver.”

FGT noted exports of grains and specialty crops have increased since 2014 “with China and India becoming increasingly important destinations for Canadian products.”

“With so much of our grain exports going to Asia, anything that improves the speed of delivery is good for all Canadians,” Manitoba’s Agriculture Minister Ralph Eichler said in P+H’s release Thursday.

“FGT provides desperately needed western export capacity for our farmers to reach global markets, one that will have a significant and positive impact locally and around the world,” Saskatchewan Premier Scott Moe said in the same release. — Glacier FarmMedia Network

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The company announced Aug. 1 it will put up a new facility in the RM of Gilbert Plains, with 25,000 to 30,000 tonnes of storage capacity and a loop track for a 150-rail car spot connecting to Canadian National Railway’s (CN) line.

By comparison, the company’s existing site at Dutton, on the CN line about 40 km west of Dauphin on Highway 5, between Gilbert Plains and Grandview, sports 16,600 tonnes of storage capacity and a 56-car spot.

The new facility, which P+H said it will name Grand Plains, is expected to offer farmers a receiving capacity of 550 tonnes per hour, with load-out capacity of 1,500 tonnes per hour.

Grand Plains’ new crop input centre is expected to include a 6,000-tonne capacity bulk fertilizer shed, with up to 250 tonnes per hour of blending capability. A chemical storage shed and a new grain drying system will also be set up at the site, the company said.

On-site seed treating facilities will also be available, the company said, to serve the “direct-to-grower” market and to supply P+H’s existing ag input centre at Swan River, Man., about 150 km northwest of Dutton.

A firm timeline hasn’t yet been set for Grand Plains’ construction, but Crystal Baker, the company’s general manager at Dutton, said P+H hopes to start building in the spring.

The existing Dutton site, built up around a traditional-style wooden elevator, will continue to operate at least until Grand Plains is built, Baker said.

Past that, the company has no plans to sell the older site but specific plans haven’t yet been made for its future use.

“Our investment in the Grand Plains location is key to bringing complete crop input and grain solutions to growers in the Parkland region,” John Heimbecker, president of P+H’s grain division, said in a release.

“The facility will not only provide crop input products and services, it will also expand the grain marketing opportunities for farmers in this area.”

Apart from Dutton, P+H’s grain handling space in the region includes elevators at Yorkton, Sask., about 140 km west; near Strathclair, Man., about 160 km south; at Moosomin, Sask., about 200 km southwest; and at Gladstone, Man., about 210 km southeast.

Other major grain handling players active in Manitoba’s northwest include Richardson Pioneer, at Dauphin and Swan River; Cargill, at Dauphin; and Viterra, at Roblin. — Glacier FarmMedia Network

CORRECTION, Aug. 17, 2018 — An earlier version of this article incorrectly quoted the Dauphin Herald newspaper as quoting P+H staff that the Grand Plains facility would be up, rather than started, as early as May next year. We regret the error.

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Privately-held P+H announced Tuesday it will build a new 46,000-tonne capacity grain elevator and crop input centre at Viking, about 120 km southeast of Edmonton.

The Viking site will tie into Canadian National Railway (CN) track with a 150-car loop track, and will also include a 25,000-tonne dry bulk fertilizer shed and chemical storage facility.

P+H, which broke ground at the new site earlier this month, expects to create 20 new jobs locally and “expand new inputs and grain merchandising opportunities for area farmers,” company president John Heimbecker said in a release.

A company spokesperson said the Viking facility is expected to be completed in early 2019.

P+H said it expects the Viking site to expand grain marketing services and to provide support for the four crop input retail facilities it bought in the region early this year.

Those facilities — at Sedgewick, Wainwright, St. Paul and Marwayne — came to P+H through a divestiture ordered by the federal Competition Bureau as a condition of approval for Agrium’s Crop Production Services (CPS) arm to buy Andrukow Group Solutions, an independent crop retail chain.

CPS had owned the Marwayne and St. Paul stores while the Sedgewick and Wainwright stores were part of the Andrukow chain. Viking is in the middle of the same 200-km-diameter area between Edmonton and Lloydminster as the four facilities.

Agrium’s consent agreement with the Competition Bureau blocks CPS from buying any similar ag retail and/or fertilizer assets in the Andrukow chain’s catchment area for three years — and from buying back the four divested sites for 10 years.

Heimbecker said the company “expect(s) the economic spinoffs from the local construction crews to be significant to the Viking area over the next two years.” — AGCanada.com Network

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Agriculture Minister Lawrence MacAulay on Thursday announced a $10 million “repayable investment” in the project from the AgriInnovation program, part of the Growing Forward 2 ag policy funding framework.

AgriInnovation is meant to back research and development work into new products, processes and practices for the ag and agrifood sectors, as well as projects to help commercialize those new developments. The program runs through to the end of March 2018.

At Hamilton, the program will help fund “exciting new technologies that will improve consumer confidence in wheat products,” MacAulay said.

P+H’s new “state-of-the-art” plant, the government said, will have a built-in traceability feature that’s expected to help the company identify specific product batches in case of a product recall.

The company also plans to use “the latest” technology in wheat cleaning, “to improve food safety by doing a better job of removing impurities before milling.”

Already Ontario’s biggest and Canada’s second-biggest flour miller by capacity, P+H expects to quadruple its wheat procurement from producers and add 16 full-time jobs with the new mill, the government said.

The company last December picked up a $5 million investment for the mill project from Ontario’s Food and Beverage Growth Fund. P+H itself is investing $40 million to build the mill, near its existing twin-domed grain terminal at Hamilton’s Pier 10.

The province said at that time the expansion of P+H’s Hamilton site is expected to allow the company to process 25 per cent more grain and boost its annual intake of Ontario wheat by more than 10 per cent.

The company already operates Ontario flour mills at Cambridge, Acton and Hanover, plus mills at Montreal, Halifax, Lethbridge and Saskatoon.

The company’s product lines include hard red spring wheat flour for breads, soft winter wheat flour for cakes and cookies, semolina for pasta, organic flour, rye flour and atta flour for chappati. Its Parrheim plant at Saskatoon also mills pea fractions and barley beta-glucan.

Derek Jamieson, president of P+H’s milling group, said in Thursday’s release the federal funds will support his group’s “ongoing commitment to food safety, innovation, productivity and quality” and help it “to continue to grow with our customers and support the sustainable growth of the baking industry in Canada.”

Local MP Bob Bratina said the company’s project “adds to our remarkable agricultural sector and provides the kind of development cities require for sustainable, recession-proof economies.” — AGCanada.com Network

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