Ceres Global latest to build Canadian canola plant as oilseed demand spikes (updated)

Ceres Global Ag

25/05/2021 15:16

(Updates with CEO interview)
    By Rod Nickel and Arunima Kumar
    WINNIPEG, Manitoba, May 25 (Reuters) - U.S. agriculture
company Ceres Global Ag Corp  CRP.TO  said on Tuesday it will
build a $350 million canola-crushing facility near the
U.S.-Canadian border in Northgate, Saskatchewan, the latest
project to capitalize on surging oilseed demand.
    Canada is the biggest global producer and exporter of
canola, a rapeseed variant that crushers process into vegetable
oil and meal. Plans for North American refineries to produce
renewable diesel, a clean-burning road fuel that can be made 
from canola oil, has added to interest in the crop.
    Minneapolis-based Ceres said the facility will crush up to
1.1 million tonnes of canola annually and produce 500,000 tonnes
of canola oil, for both food and fuel uses. It will open in
2024.
    The Ceres plant will directly connect to BNSF Railway Co
 BNISF.UL . 
    That will allow it a faster path than other Canadian
facilities to ship canola oil to U.S. refiners and canola meal
to California and New Mexico, where ranchers and feedlots feed
it to cattle, Chief Executive Robert Day said in an interview.
    Cargill Inc  CARG.UL , Viterra Inc and Richardson
International also announced plans this year to expand crushing
in Saskatchewan, the largest Canadian canola-growing province.
 urn:newsml:reuters.com:*:nL1N2MJ1NZ
    Canola does not have U.S. Environmental Protection Agency
approval for use as a feedstock in renewable diesel, although
Day said he expects it to receive that designation before Ceres
opens its plant.
    With so much new crush capacity planned for Saskatchewan,
processors are counting on farmers raising yields or expanding
plantings to increase supply. Canola futures hit an all-time
high this month. 
    Ceres' plant will be far enough away from Saskatchewan
competitors for it to source two-thirds of the plant's canola
from Canada, with the remaining one-third expected mainly from
North Dakota, Day said.

 (Reporting by Rod Nickel in Winnipeg and Arunima Kumar in
Bengaluru; Editing by Shailesh Kuber and Steve Orlofsky)
 ((rod.nickel@tr.com
1 204 230 6043
@RodNickel_Rtrs))