Ceres Global Ag Corp. has suspended plans to build a canola crush plant and refinery along the Canada-U.S. border at Northgate, Saskatchewan.
The publicly-traded company says it has decided to halt the project “due to a variety of factors, including but not limited to, inflationary pressures resulting in higher costs than initially projected and shifting macroeconomic conditions,” the company said, in a statement issued June 24.
Originally announced in May 2021, with an estimated price tag of US$350 million, the Ceres canola processing facility was intended to process 1.1 million tonnes of canola annually, producing more than 500 thousand tonnes of canola oil each year.
Unlike other crush plants in Western Canada, the facility’s direct access across the border to the BNSF railroad network was seen as an opportunity for both originating canola from the U.S. and for shipping processed oil and meal directly into the U.S. market or to U.S. ports.
Ceres now says it expects to face a charge in the range of $25 to $30 million for terminating an equipment design and supply contract.
“Ceres intends to continue to explore avenues to pursue a canola crush project of some form in the future, but there is no guarantee that such a project will come to fruition or would be similar to the previously announced project,” the company said.
Ceres is headquartered in Minneapolis, Minnesota, and together with its affiliated companies, operates 13 locations across Saskatchewan, Manitoba, Ontario, and Minnesota, including a small soybean crush plant in southern Manitoba.
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