Canola crushing aspirations announced

The WA Government has entered exclusive lease negotiations with Cargill Australia for the canola crush plant, in a joint statement released by the company and Premier Roger Cook.

This is almost a year after GrainCorp also announced WA as the preferred location for a new canola crushing plant.

"This is a hugely exciting project for Kwinana and for WA - expanding our local processing capacity, creating local jobs and positioning our State in the clean biofuel market," Mr Cook said.

"My government will now work closely with Cargill to progress this project and ensure we provide the land and support to keep Kwinana at the heart of our State's industrial future."

Cargill Australia managing director Zsolt Kocza said his company was committed to working closely with the government to ensure the project progresses, subject to regulatory approvals.

"We see a range of benefits including adding processing capacity to Australia and the ability to process Western Australian canola to oil and meal which will service the domestic and export oil and meal markets besides supplying to the emerging biofuel market both in Australia and internationally," Mr Kocza said.

"Cargill has been in discussions with several parties regarding this potential crush plant facility in Kwinana, including CBH Group, with how their existing supply chain may be able to support accumulation and export connections for the plant."

In an email sent to WA graingrowers last Thursday, CBH Group said following early stage discussions with Cargill, it would continue to move forward to assess the opportunity.

"CBH welcomes this development which provides the opportunity for a canola crushing plant to be located next to one of our critical supply chain assets," said the email signed by chief executive Ben Macnamara.

"In line with our purpose to create sustainable value for WA growers, CBH is open to considering opportunities that provide growers with market optionality that utilises our supply chain."

The news of the potential Cargill-run crushing plant was greeted with enthusiasm by Grain Industry Association of Western Australia (GIWA) executive officer Peter Nash.

"GIWA welcomes news of this potential new crush plant in WA," Mr Nash said.

"Canola is a very important part of our farming system and currently the vast majority of the State's canola production is exported as raw grain for crushing in Europe.

"Crushing more of that domestically has multiple benefits including employment opportunities during both the construction and operating phase of the crush plant.

"It would also create a sizeable local supply of canola oil to help stimulate and support a biofuel industry in WA, and it would help underpin long-term demand for canola which is important for our growers.

"With both GrainCorp and Cargill having now announced plans for potential new crush plants in WA, it is clear there is strong interest in this sector."

Farm Weekly believes the next stages being undertaken by Cargill include working with engineers, soil testing, transport discussions and budget planning, before the long-term lease application will be lodged.

This is expected within six months.