By Sarah Pittman and Naomi Christensen
In the Edmonton Journal, The Province, Winnipeg Free Press and Leader-Post

December 12, 2017

A major opportunity – the kind rarely seen in the agriculture industry – is sprouting up on the Prairies: plant ingredient processing.

Global demand for plant ingredients is escalating. International firms have assessed the Canadian Prairies as the perfect place to meet this appetite and are already beginning to invest hundreds of millions of dollars here. Getting in on the ground floor will position Western Canada to dominate the global plant ingredient industry. It is an opportunity we would be foolish not to build on.

If the Prairie provinces want to truly capitalize on this opportunity, they need to work together. Each province could independently create a small plant ingredient industry, but a pan-Prairie industry would be a major global player.

North American and European consumers are looking for green and sustainable sources of protein and emerging markets are increasingly more able to afford protein.

Crops of all kinds can be split into different components, like protein, fibre and starch. These components are used in nearly every kind of processed food – even beverages. They are also increasingly being incorporated into pet food, animal and fish feed, pharmaceuticals and personal care and cosmetic products. The demand for plant-based protein alone is already valued at more than US$8 billion and growing rapidly; and this is only one of the ingredients that can be extracted from crops.

A new Canada West Foundation report, Sprouted: the plant ingredient opportunity taking root on the Prairies, notes that together, the Prairies have advantages that make the region an attractive place to invest in plant ingredient processing.

The crops in high demand for ingredient processing are already grown in large volumes. Canada is the world’s largest producer of dry peas and canola. Pulse production is on the rise in all parts of Alberta. Saskatchewan grows about 95 per cent of Canadian lentils. Manitoba produces high volumes of canola and wheat. The Prairies house a network of crop science and food processing-related research centres working on more efficient ways to extract fractions from crops and new ways to incorporate the fractions into products. The region has good transportation infrastructure facilitating exports.

Unlike most products, it actually makes sense to process ingredients closer to where the raw inputs come from, instead of at the end market; it costs less to ship a specific ingredient than the entire unprocessed plant, and processing at the source cuts down on waste.

Another huge advantage is being located next to the largest market for plant-based ingredients: the United States. In 2015, North America was the biggest market for plant protein, making up 35 per cent of global demand. Of the 247 kilotonnes of plant protein consumed in North America, nearly 80 per cent was in the U.S. Our preferential trade access and relatively short shipping distance to the U.S. is already attracting international plant ingredient processors to set up shop in the Prairies.

This is a real opportunity with a real market. Both foreign and domestic companies have noticed our competitive advantages, with new plant ingredient processing factories being announced in the last year. For example, Alberta-based W.A. Grains is building a fractionation facility in Bowden, and crops from Alberta are also sourced as inputs for some Saskatchewan ingredient processing facilities.

There are still challenges to overcome. While research has advanced, it is still difficult for some crops to be processed into ingredients efficiently on a commercial scale. Transportation can be expensive, especially when small volumes of an ingredient are shipped. But challenges can be overcome, particularly when industry and government make a concerted effort to do so.

To help this industry grow, government should make it a priority, with a real commitment of resources and support. Industry should continue to lead research and investment in this field. When industry and government work towards dominating the plant ingredient market, success will follow.

The Prairies cannot afford to be complacent – this is a real chance to diversify our economic strength in agriculture. The provinces can either compete with each other, or combine strengths and compete with the world to reap even greater rewards.

Sarah Pittman is a policy analyst and Naomi Christensen is a senior policy analyst at the Canada West Foundation. They are co-authors, along with Carlo Dade, of Sprouted: The plant ingredient opportunity taking root on the Prairies