Northgate welcomed as another marketing option

An $80 million grain terminal and rail export service in southern Sask. is expected to encourage all grain companies to sharpen their pencils

Cameron Nordin can’t wait until the first trains start hauling grain and canola out of a new rail terminal at Northgate, Saskatchewan, destined for U.S. markets.

Right now, most of the crops from his southeast Saskatchewan farm near Oxbow are trucked about 60 miles east to a Cargill elevator at Elva, Manitoba. He has other options too, at Carnduff and Estevan, but both of those elevators are still 45 minutes to an hour drive away. Once the new 2.5-million bushel Northgate grain terminal serviced by BNSF (Burlington Northern Santa Fe) Railway is fully operational later next year it will be one more very handy marketing option.

“And aside from being handy to our farm, we won’t have to haul grain uphill to get to an elevator,” says Nordin, who along with his brother crop about 7,000 acres about six miles east of Northgate. “It’s not a big issue but it does make it nice if you don’t have to climb out a river valley when hauling grain.

“I am delaying my marketing as long as I can this year and hopefully we can move some commodities through Northgate later this year.”

Northgate Commodity Logistics Hub

Curt Larsen (left) is the general manager at Northgate Terminal. Cameron Nordin farms near Oxbow, Sask.

Curt Larsen (left) is the general manager at Northgate Terminal. Cameron Nordin farms near Oxbow, Sask.

The Northgate project, officially known as the Northgate Commodity Logistics Hub, has stirred up a fair bit of interest among farmers in southern Saskatchewan and Manitoba. It is expected the grain terminal will serve as a marketing option for farmers within a 150 to 200 kilometre trading area. Northgate isn’t just a shipping point, the company will be buying grains, oilseeds and pulses for its customers in the U.S. and Mexico, as well as offshore.

Developed by a Canadian investment company — Ceres Global Ag Corp. —Northgate is roughly an $80 million rail terminal project built adjacent to the North Dakota border where at one time there was a hamlet of Northgate, Saskatchewan. Highway 9, which runs north and south along the east side of Saskatchewan, and passes through the southeast communities of Broadview, Carlyle and Alameda, comes to a border crossing at Northgate, Saskatchewan and carries on to Northgate, North Dakota connecting with U.S. highways leading to the interstate highway about 60 miles south at Minot.

While CN Rail at one time had a branch line running to Northgate, Sask., it has long been abandoned. Ceres Global Ag is building the grain terminal near where the Northgate hamlet once stood, and laying about a mile long rail spurline south to the border where it connects with a BNSF branch line which then travels south to the vast BNSF rail network across the U.S.

“We hope to be moving some grain from southern Saskatchewan into the U.S. before the end of 2014,” says Curt Larsen, general manager at the Northgate terminal. “Once the customs office is established we plan to move between 50 and 70 rail cars per week into the U.S.”

Southern Prairie farmers will be able to haul commodities to a temporary transloading facility at Northgate destined for U.S. markets — which basically means they will unload trucks directly into waiting rail cars. That transloading facility is built and tested and ready to load rail cars.

The permanent grain terminal will be a combination of concrete and steel elevators with 2.5 million bushel capacity.

The permanent grain terminal will be a combination of concrete and steel elevators with 2.5 million bushel capacity.

In the meantime, workers from a 100-person crew camp on the Northgate property are busy building the permanent grain terminal, which will be a combination of concrete and steel elevators with 2.5-million bushel capacity. FWS Industrial of Winnipeg, a specialist in slipform concrete structures is the lead contractor on the project.

With the crew working all winter, Larsen says the target is to have the permanent grain terminal operational by October 2015. Along with grain storage, Northgate will also have two cleaning lines — one for grains and one for oilseeds. Once that permanent facility is in place, Northgate expects to load two unit trains or about 220 rail cars per week, carrying an estimated 800,000 bushels of grains, oilseeds and pulse crops weekly to U.S. and other export markets.

More than just grain

But the overall Northgate project isn’t just about grain. Ceres Global has built two, seven-mile long loop tracks (see image at top of page) that run parallel on the Northgate property. On one side of the loop will be the grain elevators and loading facility and on the other side of the loop will be an equally important “energy” loading facility that will load rail cars with crude oil and natural gas products also bound for U.S. markets.

“It is a diversification plan,” says Pat Bracken, CEO and board chairman at Ceres Global Ag. He is based in Minnesota. As the company looked at the project and the potential of being able to connect directly to the U.S. through the BNSF rail, they realized there were two important Canadian industries that Northgate could service — the agriculture and the energy industries.

“Canadian farmers experienced a serious bottleneck with rail services last year in trying to move grain to market,” says Bracken. “And there is significant oil production in southern Saskatchewan that all has to be trucked from the oil fields to rail lines. Our Northgate facility will be of value to both of these industries.”

Crews are currently building the energy side of Northgate with plans to have a temporary transloading facility that can handle about 15,000 barrels of energy products per day, leading up to a permanent loading facility that will be able to handle up to 60,000 barrels per day when completed next year.

Tied to U.S. markets

What appeals to farmers such as Cameron Nordin is that Northgate will serve as another marketing option in the southern Saskatchewan, southern Manitoba region.

GM Curt Larsen, is also one of the grain buyers working for Northgate. Larsen farmed himself in Saskatchewan for many years, served as a facilities manager for ConAgra grain for a several years and was one of the original market advisers with the Western Canadian FarmLink Marketing services.

The main man on the grain buying side is Jason Labossiere, who has also been around the Saskatchewan grain industry for a number of years.

An important part of the whole marketing program offered by Northgate and Ceres Global Ag is its built-in connection to the U.S. market. Ceres also owns the U.S. based Riverland Ag Corp. Riverland owns 10 grain storage and handling facilities in Minnesota, New York, Wisconsin and Port Colborne, Ontario.

“Riverland already has a well established marketing network in place,” says Larsen. “They have markets across the U.S., Mexico as well as offshore that can all be supplied with high quality Canadian grains and oilseeds. So we will be buying here to supply commodities to Riverland customers. I don’t doubt that we will be very competitive with other grain buyers across the Prairies.”

And competition in the marketplace is a good thing, says Nordin. “I am anxious to see what prices and services Northgate can offer,” he says. “I believe as a farmer it is going to help me even if I don’t deliver a particular commodity to Northgate. The fact they are here and providing these services will encourage all grain companies in the southern Prairies to sharpen their pencils.”

Nordin who is also a local councilor with the Rural Municipality of Enniskillen, does encourage all farmers, as well as all oil companies to use the main Highway 9 as much as possible to access the Northgate site, reducing the traffic pressure on municipal roads.

Northgate isn’t planning to offer any agronomy services or retail centre for agriculture input products. Although Larsen says it plans to handle bulk commodities for both the agriculture and oil and gas industries. “We have plenty of room on our site to set up bulk handling facilities,” he says. “Once we are fully operational I can see opportunity for farmers to haul in a load of grain to elevator and be able to haul home a load of fertilizer.”

Farmers looking for Northgate marketing information can contact Curt Larsen at 306-861-5075 or Jason Labossiere at 306-861-7543.

About the author

Field Editor

Lee Hart is editor of Cattleman’s Corner based in Calgary.

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