Plant an­nounce­ments build lo­cal econ­omy

Moose Jaw Express.com - - Front Page - By Ron Wal­ter For Moose Jaw Ex­press

A lot of eye­brows were raised when the Prov­ince of Saskatchewan and Cargill teamed up to build the Sask­ferco ni­tro­gen fer­til­izer plant at Belle Plaine in 1984.

The $435 mil­lion in­vest­ment with the Con­ser­va­tive gov­ern­ment foot­ing 49 per cent of the bill caused more raised eye­brows.

When Yara, owner since 2008, an­nounced the other day it will more than dou­ble pro­duc­tion at the plant, it was just an­other solid good news busi­ness story of the day.

Back in the 1980s, a mil­lion dol­lar in­vest­ment in Saskatchewan was a pretty big deal — not just be­cause dol­lars were worth more then ei­ther. Busi­ness just wasn’t mak­ing big in­vest­ments in Saskatchewan. To get the plant here, the Saskatchewan gov­ern­ment had to buy into the deal.

That is no longer the case. Saskatchewan re­sources and the global need for them have caused a bliz­zard of in­vest­ments from all over the world to fill mar­ket needs around the globe

Yara paid $1.6 bil­lion — a 267 per cent gain on the prov­ince’s in­vest­ment — for the plant in 2008. Now, the Nor­we­gian­based Yara will ba­si­cally build a new plant be­side the ex­ist­ing fa­cil­ity at Belle Plaine.

The Sask­ferco plant was state of the art 22 years ago when it was built. It used one-quar­ter less nat­u­ral gas than older com­pet­ing plants in Canada. No doubt the Yara ex­pan­sion will take the tech­no­log­i­cal ef­fi­cien­cies even fur­ther.

Cur­rently Yara pro­duces 1.1 mil­lion tonnes an­nu­ally of urea fer­til­izer. The ex­pan­sion will in­crease pro­duc­tion by 1.3 mil­lion tonnes.

The Yara an­nounce­ment is a mixed bag for Moose Jaw. Hun­dreds of con­struc­tion jobs will be cre­ated in the years un­til 2016 when the pro­duc­tion starts and dozens of new jobs will be cre­ated.

That is great news for the lo­cal and provin­cial econ­omy, but presents a chal­lenge to lo­cal busi­ness. Where will th­ese peo­ple stay? The city rental va­cancy rate is at a low now and the ex­pand­ing sup­ply of new res­i­den­tial lots can’t keep up with de­mand from builders. As some­one said re­cently, those are nice prob­lems to have, given our slow-growth-no-growth past.

An­other an­nounce­ment re­flected the strength of the agri­cul­tural sec­tor in this part of Saskatchewan. The an­nounce­ment team­ing up Agro­corp In­ter­na­tional of Asia, Mc­Dougall Acres and other in­vestors in a ma­jor pulse pro­cess­ing plant in Moose Jaw in­di­cates just how the agri­cul­tural pro­cess­ing in­dus­try holds op­por­tu­ni­ties.

While the new plant on the CNR line in Moose Jaw will have ca­pac­ity to han­dle pulse crops, canola and the for­mer wheat board crops like wheat will be part of the op­er­a­tion here.

Con­struc­tion will be com­pleted later this year on the high through­out pro­ces­sor that will em­ploy up to 20 peo­ple.

Agro­corp is a $1 bil­lion an­nual op­er­a­tion with con­nec­tions around the world. To have the com­pany in­vest here is a true catch.

And this in­vest­ment builds on the grain in­dus­try in­fra­struc­ture in Moose Jaw, long known for its role in the grain busi­ness.

Ron Wal­ter can be reached at ron­joy@sask­tel.net

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