GrainCorp to spend $30m on Canadian JV

Agribusiness GrainCorp has established a joint venture with Japan’s Zen-Noh Grain to operate grain receival sites in Canada.

The 50/50 joint venture, announced on December 14, will be based in Calgary, Canada, and plans to operate grain receival sites across Alberta and Saskatchewan.

GrainCorp says the sites will be part of a fully-integrated supply chain for the origination, marketing, storage, handling, distribution and exporting of Canadian grain and oilseed.

To support the start-up phase of the project, GrainCorp will contribute A$30m over the next two years.

The JV will also source $60m in funding from financial institutions.

“This is an exciting opportunity to partner with one of the world’s most respected agricultural organisations and deepen our relationships with our international customers by growing our grain origination capability,” GrainCorp boss Mark Palmquist said.

“The joint venture will leverage GrainCorp’s existing Canadian footprint, including our Calgary Marketing office and Canadian Malting Company operations; plus Zen-Noh Group’s significant experience and customer relationships in exporting agricultural commodities from North America to Japan and other Asian destinations.

“A key part of GrainCorp’s value proposition for international customers is to have a multiorigin offering, so that we are in a position to offer a solution for a broader range of requirements.

“This gives us greater relevance and a broader platform to engage with the
customer, creating more opportunities to offer our services.

“Of course, the new business also benefits grain and oilseed growers in the Canadian Prairies, by providing an independent and alternative pathway to market,” he added.

“We are pleased to be involved in this project with GrainCorp,” Zen-Noh Grain president John Williams said.

“This is a good opportunity to grow our business in Canada with a trusted partner. It allows us to strengthen further our ability to supply our customers in Japan and Asia and we look forward to a bright future for the joint venture.”