Prairie sentinel still stands tall Historic wooden grain elevator in Netley continues to connect farmers to markets By: Martin Cash Posted: 7:14 PM CST Friday, Nov. 24, 2023

Hey there, time traveller!
This article was published 24/11/2023 (1028 days ago), so information in it may no longer be current.

Like every other industry, almost everything about the Prairie grain transportation system has evolved.

A major lurch was required after the shuttering of the Canadian Wheat Board in 2012, but long before that many of the old-fashioned wood grain elevators that dotted the Prairie landscape were being demolished, with service aggregated into fewer mega elevators, sometime 10-to-20 times the size, but requiring ever greater distances for farmers to get their gain to market.

Of the old ones still standing, most have long since been retired from service.

But not the one in the little town of Netley, Man., about 55 kilometres north of Winnipeg. It is still very much in business.

Originally built about 75 years ago by Manitoba Pool Elevators, it became part of Agricore when Manitoba and Alberta pools merged in 1998 to form Agricore which then merged with United Grain Growers to form Agricore United in 2001.

(Agricore United merged with Saskatchewan Pool in 2007 to form Viterra Inc. and in 2011 Viterra was acquired by Glencore plc, a Swiss multinational commodity trading and mining company. This year, U.S.-based Bunge has offered $8 billion to acquire Viterra.)

In 2000, just before Agricore merged with United Grain Growers, the Netley terminal was sold to a local producer named Randy Penner.

Penner wasn’t planning to get into the grain handling business, per se and a condition of his purchase of the elevator was that he could not use it as a third party distribution centre for five years.

He figured the facility – located “downtown” in the old village of Netley — could be used as an off-farm storage facility for his own 3,400 acre Tri-Field Farms nearby.

Unlike its peers, the Netley elevator had received significant improvements in 1986 with the addition of two big steel tanks, a new office and a new scale.

“There was lots of money put into it. It was way too good to be torn down,” said Penner, who retired a year ago as superintendent of the elevator for its current owner, Scoular, a $10-billion agri-business based in Omaha, Neb.

“That’s how I looked at it,” Penner said. “My thoughts were that it would be good for farm storage. I had livestock — a hog barn and turkeys — and I was going to set up a feed mill.”

While the Netley elevator’s contemporaries in places like Arborg, Riverton, Balmoral, Fisher Branch and Clandeboye were demolished, the revival of the abandoned CP rail line that serviced the Netley elevator – which became the 50 kilometre long farmer-owned Lake Line Railroad — gave Netley a bit of a life-line. (Until recently Penner was also involved in ownership of the rail line.)

The Netley terminal has storage capacity for 2,000 tonnes of grain. Such a facility is dwarfed by the new cement terminals now being build that have as much as 45,000 tonnes of storage capacity, capable of loading 150 cars much quicker than Netley elevator could possibly handle.

A few years after he bought the elevator Penner had occasion to see a presentation from a Scoular executive in Saskatoon about one of Scoular’s niche businesses, supplying distillers grain.

“There was lots of money put into it. It was way too good to be torn down”–Randy Penner

Penner made sure he introduced himself and Scoular officials eventually visited and saw the facility. That led to occasional contracts to clean rye that was destined for delivery to Diageo, just a few kilometres north in Gimli.

It eventually led to Scoular buying the terminal in 2016 and it continues to own and operate it today. While Penner retired a year ago, family members continue to work there.

“Since Scoular’s acquisition of the grain elevator in Netley, Manitoba, we have focused on supplying high-quality grain ingredients to niche markets that larger competitors within the region do not focus on,” said Jason McGillivray, merchandiser at Scoular Canada’s headquarters in Calgary. “This has been a successful strategy. Scoular has continued to operate the Netley facility, as well as add value to the local farmers and communities by providing access to markets they might otherwise not participate in.”

While Scoular officials took pains to avoid talking about Diageo specifically, sources in the region openly talk about the fact that local rye producers have a great market for their high quality distiller rye and corn with Diageo’s Crown Royal production plant in Gimli.

At the time of its purchase of the little Netley terminal, Jeff Vipond, Scoular’s then senior marketing manager, said, “Our role is to connect local production to the best market. We give our end-use customers the products they need, when and where they need them, and bring the value of that demand back to growers.”

Penner said, “We’re just trying to keep it local. We all pay taxes here (the elevator has four full-time employees) and spend money in the area. All the other small elevators in the area have shut down. We’re trying to keep a little economic activity in the area.”

martin.cash@freepress.mb.ca