North West Terminal suspends elevator operation and grain purchases
By Kelvin Heppner
realagriculture.com
The board of directors for a large farmer-owned grain elevator in western Saskatchewan has decided to idle its facility as a result of negative margins that it anticipates will continue into next year.
North West Terminal Ltd. (NWT) at Unity, Sask. is suspending all purchases of grain, and has cancelled its elevator license with the Canadian Grain Commission, as of Sept. 18, 2024.
“Significant headwinds in the grain industry have resulted in negative margins for the grain division the past several years and are expected to continue into 2025,” the company says, in a Sept. 18 notice.
NWT says its inland terminal at Unity will remain closed indefinitely — until grain industry margins improve, or the elevator is sold. The elevator is one of the largest grain handling facilities in Western Canada, with total storage capacity of 2.3 million bushels (63,000 MT) and a 150-car rail siding with access to both CN and CPKC’s rail networks.
Operations are continuing at NWT’s distillation facility located at the same site.
In the meantime, NWT’s board has engaged FTI Capital Advisors Canada as a strategic advisor to determine next steps that are in the best interests of NWT and its farmer-shareholders.
“The temporary idling of the grain elevator is a necessary step during these turbulent times,” says NWT’s president Brad Sperle, who farms near Unity. “We feel it is in the best interests of NWT and stakeholders to idle the elevator and focus efforts on the distillery business while the strategic review process is underway.”
The company had temporarily laid off nine of its 29 staff in March of this year, with the intent of calling staff back to work in August ahead of the harvest season.
The company’s financial struggles have been evident in its earnings reports, as it reported a total comprehensive loss of $10.1 million for the fiscal year that ended October 31, 2023, and losses of over $3 million in the six-month period ending April 30, 2024 — the halfway mark for its current fiscal year.
NWT is also a minority owner of Alliance Seed Corp. in Winnipeg, Man. and Alliance Grain Terminal at the Port of Vancouver, British Columbia.
According to its website, the company is owned by approximately 1,000 shareholders, the majority of which are area farmers.