Manitoba Pulse & Soybean Growers (MPSG) supports efforts to attract a soybean-crushing plant to Manitoba, but is neutral on where it’s built, says association executive director Francois Labelle.
“We want to see a facility built in Manitoba,” Labelle said in an interview Sept. 29. “That has been our position since we first started talking about this in 2014. We want to make sure Manitoba works together to make that happen. That’s what we need to have. There are different thoughts about how it should happen, but it’s really the builder that will decide (the location).”
The MPSG issued a news release last week with the same message, partly in response to rumours it has a preferred location.
Westman Opportunities Leadership Group (WOLG), which has the backing of the Keystone Agricultural Producers, MPSG and a number of municipalities, has been working for almost a year to build the case for a soybean-crushing plant in western Manitoba.
A Manitoba farmer tweeted Sept. 18 that he’d heard the MPSG board wanted a plant built in eastern Manitoba.
“OMG. Just build it! Help every MB farm’s basis!” the tweet read.
The rumour is wrong, Labelle said.
The MPSG represents all Manitoba’s pulse and soybean growers, chair Jason Voth said in a news release.
“The possibility of a crush plant is an encouraging topic and we’re working hard on the research and market development side to shed light on the correct path,” he said. “MPSG is sitting at the soybean crush table to make sure the plant gets built in Manitoba. We are not here to choose a specific location or take sides. We are involved because we have a deep understanding of the subject matter and are happy to share it.”
Even though soybean plantings and production have been growing dramatically in Manitoba more of both is needed to attract a plant, which would cost at least $400 million to build, Labelle said.
“I can’t expand on that enough,” he said. “Even though we are producing lots of soybeans we’re not in a position yet that somebody is going to jump out and build a plant.
“No company is going to buy all the beans, so you need a fair acreage.
“I think one of the things people miss is it’s not whether it’s going to be built in Brandon, or Portage or Winnipeg or Altona that really counts. It’s whether it will be built in Manitoba, whether it will be built in China, whether it will be built in Brazil. When you spend $400 million you’re going to look where you get your best return in the world.”
However, Manitoba does have some advantages, including the demand for soybean meal from its hog producers, Labelle added.
In June the MPSG held a seminar “to deliver industry knowledge and expertise” to groups interested in a Manitoba soybean facility,” the MPSG said in its release.
The WOLG, agriculture consultant Mark Rowe and Manitoba Agriculture officials attended. Rowe had information on plant operating costs, energy demands and the high volume of processing required to be profitable.
“To go from a 2,000-tonne (a day crush) plant to a 3,000 it’s in the $10- to $15-a-tonne margin improvement,” Labelle said.
A proposed North Dakota soybean plant will crush 3,400 tonnes a day (1.24 million tonnes a year operating at full capacity), which is considered small. A 5,000-tonne-a-day plant is being built in Brazil, he added.
Earlier this year Manitoba Agricultural Services Corporation (MASC) estimated Manitoba farmers insured a record 2.3 million tonnes of soybeans. Assuming five-year average yields of 38 bushels an acre (1.02 tonnes an acre) that’s 2.3 million tonnes of production — not quite double the volume needed by a 3,400-tonne-a-day plant. But Manitoba soybean yields are expected to be slightly below average this year.
In May 2015 a study prepared for the MPSG and Soy 20/20 concluded Manitoba soybean production could sustain a 2,000-tonne-a-day soybean-crushing plant, in part because of poor and expensive rail service to export soybeans and import soybean meal.
Since then, rail service has improved and the grain industry hopes western Canadian-grown soybeans will be included under the maximum revenue entitlement, resulting in lower rail shipping costs.
Manitoba soybean plantings of just 18,419 acres in 2000, have exploded, increasing 125-fold.
Insured plantings nearly tripled in 2001 and increased again in 2002 and 2003, fell in 2004 and 2005, increased in 2006, fell in 2007 and since then have gone up every year.
Plantings this year were up 39 per cent from 2016’s record.
Last year average insured soybean yields in Manitoba set a record at 42 bushels an acre.
For many years soybeans have been Manitoba’s third-biggest crop behind canola and wheat, respectively. But MASC projects for the first time crop-insured soybean acres had exceeded insured acres of red spring wheat — MASC’s biggest wheat category, which covers varieties in the Canada Western Red Spring wheat class.