Farmer-led Seed Co-op Positioned For Growth

Take a group of entrepreneurial growers, add an industry on the cusp of major growth and mix in a rebranding strategy with the goal to expand into international markets and you have the recipe for a farmer-led success story.

Over the past several years, Alberta Seed Processors (ASP) has taken its decades old co-operative and created a more cohesive, forward-thinking organization that offers more opportunities for growers to meet the needs of local and global markets.

“We used to be known as the Alberta Association of Co-op Seed Cleaning Plants and, on top of being a mouthful, it didn’t really describe the scope of what we were doing,” says Kelly Wheeler, vice-president and director of ASP. “Today we are very diversified — we do a lot of exporting, we treat seed, we grow seed and much more.”

Although still a critical part of its market, ASP has expanded its business from basic seed cleaning to exporting specialty grains and pulses, offering producer car loading sites, processing for grain brokers and expanding distribution sites for seed growers and companies.

The group of 67 independent farmerowned grain processing co-ops are scattered throughout Alberta and into British Columbia’s Peace region. In 2016/17, ASP processed 44 million bushels of seed and grain. Thirty-three million bushels were processed for farm seed, with more than six million processed for the pedigreed market. Almost 10 million bushels were processed for export or for upgrading of domestic commodity grains/ pulses and oilseeds.

More than $17 million has been spent over the past four years upgrading facilities. Upgrades include the installation of optical sorting and legal-for-trade weighing systems that can manage even the biggest transport trucks. In the last five years, Strathmore, Enchant and Lougheed locations have built new state-of-the-art facilities, with new plants in Bashaw and Taber currently under construction.

“It’s really the growers and plant managers who have driven our growth,” says Wheeler, a farmer himself. “They are all about creating new opportunities and adding value to what we do. Through ongoing investment we are able to continually upgrade our facilities and processes to meet the needs of growers in our community.”

Part of the rebranding was a vision to create seed and grain processing opportunities for both the local and global markets. As advocates for growers, ASP has used the size of its business to its advantage in order to get a seat at the table with government ministers and to have representation in industry round tables. Because of the volume of seed ASP processes and treats, its opinion on industry issues holds weight.

Successful expansion for Strathmore facility

Wheeler chairs the board of the Strathmore plant, which is just one of ASP’s recent success stories. Recognizing the inefficiencies of its original 40-year-old plant, a new facility was built that’s capable of cleaning seed at 1,200 bushels per hour. To meet export demand, the facility added sea-can loading capabilities.

And with the increasing popularity of cropping lentils in this region of the province, the Strathmore plant also includes cleaning capacity for 600,000 bushels of lentils.

“While the core of our business is cleaning seed for local farmer members, we knew it was time to grow with changing markets,” says Wheeler.

“Our Strathmore facility is owned by a group of forward looking growers who wanted to move into exporting, add in specialty crop cleaning and also move further into pedigreed seed and malt processing,” says Wheeler. “We had to adapt our technology to accommodate these changing market demands.”

Keith Reynolds is the plant manager at the Strathmore facility and says that working as part of a co-operative offers many advantages, including the ability to market as a group, manage benefits on a group basis and the ability to share information with others, not only within the same industry, but in the same province. He says the expansion of the Strathmore plant was developed with future growth in mind.

“We built the Strathmore facility bigger than what we need today, to plan for more and new business,” says Reynolds. “We needed to modernize and we wanted to include more than just seed cleaning,” he added. “The sea-can loading area is now in full operation, and we have included technology that will be able to clean hybrid grain when it comes into production. We are well positioned to participate in the market today and into the future.”

With its upgraded facilities, the Strathmore plant is getting more attention from grain companies, says Reynolds. And the commercial treating business has also expanded. “In 2017 we started growing certified seed,” he adds. “That was a big change for us but we now are involved in the seed production business from the beginning to the end of the season. We are able to load and export domestically and internationally.”

Diversified growth

All member co-ops within this network of seed and grain processing professionals have a rural community focus and are as individualized as the needs of their local growers — some sell hay tarps, others sell pet food, while others sell insurance.

Bill Chapman, crop business development specialist with Alberta Agriculture and Forestry, works with ASP as a technical advisor to help the boards of directors identify new opportunities and help determine some of the best uses for expansion dollars. He says, however, that most new ideas come from local boards.

“In addition to the expansion at Strathmore, we have had several other regional success stories in recent years,” says Chapman. “At the Stony Plain facility, the board invested in oats cleaning and clipping equipment for the horse market,” he says. “It added a robotic bagger that has increased the handling capacity. It’s buying grain for containerized sales from local members and has ramped up seed treating operations. The ability to market grain to customers internationally is unique for this area.”

At the Westlock facility, the board invested in pedigreed seed cleaning and handling equipment. “Westlock handles seed for local and regional growers — anyone within a 100-mile radius of the facility,” says Chapman. “It now has 19 pedigreed seed growers cleaning and retailing seed from its operation.”

Westlock is now selling seven different crop types and, over the past several years, has scaled up for size, now processing over 800,000 bushels of pedigreed seed, and with storage facilities on site. “Westlock responded to the market and has upgraded many times,” says Chapman. “The facility has overhauled its treating capacity so that it can treat and load a Super B truck in 45 minutes.”

The farmer-owners of the Warburg facilities have recently diversified to sell pulses and forage seed, along with their original cereal cleaning business. They identified the need to be able to clean a combination of forage and cereals for their local market, which includes a large number of cow-calf operations.

“The common denominator for these three facilities, and other ASP co-ops that have expanded in the past few years, is that they all have great board members who have the foresight to evaluate these different opportunities,” says Chapman.

“They are continually investing their earnings into new projects, paying out smaller dividends while still growing the business. These sites are committed to growth and committed to making their local businesses work.” cover story

“We have a very diverse province when it comes to growing conditions — be that different altitude, soil, weather or hours of daylight,” says Wheeler. “Every region has its own specific facility, but by always looking for unique opportunities and combining our knowledge as a co-op on a provincial level, we are able to invest back into the business where it’s needed to increase our capacity and capabilities overall.” FF