Food Processing Industry

Table FPI-1. Value of Food and Beverage Product Exports from Saskatchewan, 1995-2000 (in millions of dollars)

Canadian Plains Research Center

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Saskatchewan’s agricultural industry is best known for the production and export of cereal grains, oilseeds, pulses and livestock—hence the long-held stereotype of its being the “wheat province.” Less well known is that Saskatchewan boasts a small yet rapidly growing food processing industry. According to Saskatchewan Agriculture, Food and Rural Revitalization, in 2002 the largest processing and manufacturing sector in the province was the food and beverage industry, which accounted for approximately one-third of all manufacturing shipments. Over the period 1995-2000, the value of food and beverage shipments increased by 54%, from $1,172 million to $1,807 million (see Table FPI-1). More than fifty processors actively export processed food products from the province. Total exports from the sector increased by 125% between 1995 and 2001 (from $14.6 million to $32.9 million). The United States, Japan, the Pacific Rim and Mexico are key markets for food and beverage exports. Recent information (2004) from the Saskatchewan Food Processors Association reveals that the approximately 300 food processors in Saskatchewan employ more than 7,000 people, have an annual payroll of more than $225 million, and post annual shipments in excess of approximately $2 billion.

The food and beverage processing sector is characterized by having a high proportion of very small companies, with over 70% employing fewer than ten people, and approximately 40% fewer than five. More than half of the processors are located in rural Saskatchewan; but a few large meat processing companies, a similar number of cereal, oilseed and pulse processors, and a large dairy products manufacturer, mostly located in or near Saskatoon, dominate the industry with respect to the number of employees and the value of total shipments. Although Saskatchewan will remain distant from major markets for processed products, if it can develop a stronger entrepreneurial and value-added processing culture it can look forward to continued growth in both the size and the complexity of its food processing industry. Its pristine environment and access to a wide variety of high-quality raw materials, combined with relatively low production costs, support industry development. To assist in this development, the Food Centre was established in 1997 at the University of Saskatchewan. It is a partnership between the government of Saskatchewan, the University and the Saskatchewan Food Processors Association. Its mandate is to work with small and intermediate-sized processors to develop food products and assist in business development, including processing technologies and marketing.

Robert Tyler