Canadian Food Business
Cluster impacts the value-added sector in Saskatchewan and across Canada
Text by Hermione Wilson
The Agri-Food Innovation Cluster (AgFIC) was designed by scientists to fill the gaps that were impeding research and innovation and ultimately industry growth. Formed in 2015 by the University of Saskatchewan, POS Bio-Sciences and the Saskatchewan Food Industry Development Centre (or simply the Sk. Food Centre), AgFIC serves clients across the province of Saskatchewan, Canada and even overseas as a virtual cluster and guide through the innovation to commercialization pipeline.
Rather than working as individual organizations, the three founding members of AgFIC combine their expertise and infrastructure to help walk agri-food companies through the various stages of research and scale-up to reach the commercialization stage faster. The cluster is also exploring emerging technologies that will support industry growth five to 10 years into the future. AgFIC provides companies access to a team of experts and infrastructure tailored to meet their needs, and provides the needed project management leadership to expedite solutions and commercialization.
“The University of Saskatchewan provides a lot of leadership for this cluster,” says Michael Nickerson, Associate Professor and Ministry of Agriculture Strategic Research Chair, and Editor-in-Chief of this magazine. “Its advanced equipment and technical expertise helps drive technology, and provides both the fundamental and applied research needed to understand issues and support the scale-up phases at POS Bio-Sciences and the Sk. Food Centre.”
The university complements the work of POS Bio-Sciences, which focuses on ingredient processing, process development, fractionation and toll processing. “We focus on developing high-value ingredients for our clients, to add significant value to their processes,” says Rick Green, Vice-President of Technology for POS Bio-Sciences. “Sometimes we help clients develop new ingredients, and then work with the Sk. Food Centre to enhance their utilization in food products,” he says. From there, the Sk. Food Centre focuses on product development, safety and quality, as well as providing companies with training and incubation suites to help better facilitate commercialization.
“It’s nice to be able to have the scientists from all the different platforms available at the beginning so that you can tailor your ingredient or your application with the right ingredients, with all of the technical expertise you need,” says Shannon Hood-Niefer, Vice-President of Innovation at the Sk. Food Centre. The concept is that if all the scientists have access to all of the information and can provide advice or expertise at the beginning of a project, it would shorten up the time frame.
“Most people that are coming into this cluster are accessing the cluster because they know what we’re good at, and we’re good at pulses and ingredients grown in Saskatchewan, or working with ingredients that aren’t necessarily corn and soy,” Hood-Niefer says. “Within that it can be a vehicle to promote Saskatchewan ingredients or Saskatchewan products, but not necessarily; really only when it works.”
The Value-added Strategy
AgFIC plays a part in the a larger value-added strategy for Saskatchewan’s agriculture and agri-food sector, because it places an emphasis on strong partnership between the government of Saskatchewan and the research sector that includes 136 organizations focused specifically on agricultural biosciences.
When Saskatchewan first laid out its strategy for the value-added agriculture and agri-food sector in 2012, it set a goal of increasing revenue from $4 billion to $6 billion by 2020. That value-added strategy focuses on ensuring that Saskatchewan businesses remain competitive and benefit from growth opportunities, that innovative new technologies and uses for local crop ingredients are developed and commercialized, that international trade is encouraged and companies have access to global markets, and that new investment is attracted to the province.
“We are working with businesses, other levels of government and a number of economic partners to develop an agri-value strategy custom-made for Saskatchewan,” says Stevyn Arnt, Senior Strategic Lead for Value-Added Agriculture with the Ministry of the Economy. The Saskatchewan Ministries of the Economy and Agriculture work closely together to identify and attract companies to the province and work with existing operations to help them expand, Arnt says.
“Saskatchewan is a world leader in production of pulses, mustard and canola that will provide a great deal of potential to develop agri-value projects in the coming years,” he says. Saskatchewan is Canada’s number one agri-food exporter with more than 40 per cent of the country’s farmland, and has grown into the largest exporter of lentils and dried peas in the world. The province currently crushes half of the canola it produces, which is expected to grow to 19 million acres in the near future. It is anticipated that additional canola crush will come as trade agreements like Trans Pacific Partnership (TPP) are ratified.
The Saskatchewan agricultural industry is now in search of the “Next Canola,” Arnt says. “The province’s vision is to be a world leader in supplying high-quality ingredients, bioproducts and functional foods,” he says. “Opportunities exist for canola, pulses (starch, fibre, and proteins), fruit sugars and antioxidants, cereal proteins, flax, mustard, camelina, carinata, among others.”
Expanding International Markets
When it comes to reaching its goal of $6 billion in revenue for the value-added food sector, Saskatchewan still has a long way to go, says Mark Pickard, President of InfraReady Products. “It’s 2016 and I don’t know where we sit, but whatever it is, we have four years left to make a lot of ground,” he says. “When you look at a gap of $2 billion, you have to look at very large companies to help fill that gap, and that could take years.”
Because of this, Pickard says, the government is very focused on hitting “home runs” and attracting large food processing companies to the province. That sometimes means small to medium enterprises like InfraReady get left out in the cold. In 2008 the company was looking to relocate from the north end of Saskatoon to the south side, and into a larger facility. It approached city council for financial support but none was forthcoming.
“There was no assistance for me,” Pickard says. “But if I were coming from outside the city or outside the province, they probably would have offered a tax incentive.” The government tends to take SMEs for granted, he says, adding they are the ones who are supporting the local economy and capturing value closer to home. “The ones that are here are already providing economic benefits to the producers, to the ag businesses, to the people of the province, so they shouldn’t be forgotten,” Pickard says.
InfraReady is doing its part to add value to Saskatchewan’s agri-food sector, Pickard says. The company has an active research and market development program for pulse-based ingredients for the food industry. It also worked with the University of Saskatchewan and the Sk. Food Centre on a number of projects. In fact, the Sk. Food Centre will soon be located nearer to InfraReady’s operations which Pickard says will increase its utilization of the Sk. Food Centre’s services.
He acknowledges that the Saskatchewan government has a suite of programs for entrepreneurs and food innovators, but the biggest hurdle InfraReady faces is international trade barriers when marketing its products overseas. Pickard says he would like to see the government place more emphasis on supporting agri-food companies like his in the global arena.
“For example, we have 30 per cent tariffs for our products going into Thailand,” Pickard says. “Both the U.S. and Australia have negotiated free trade agreements. Their products, as a result, are preferential. That’s kind of an issue for us.”
Saskatchewan is blessed with raw materials and an unpolluted environment, he says, one that could be very sustainable for food and ingredient production if the industry and the province could create the markets for those goods. “That’s a very costly proposition for food companies, but I think most of us are up for the challenge,” Pickard says. “We continue to need help in creating markets for our ingredients, and to grow our existing markets. Small could be the next big thing.”
Going Forward
Mobilizing resources to strengthen the value-added agri-food economy is of significant economic importance to Saskatchewan and Canada, as the country moves away from continually exporting its raw materials overseas to one that carries out more secondary processing at home to create jobs and wealth, Nickerson says.
“Saskatchewan has a very attractive investment climate topped with a multi-billion-dollar food industry and a competitive tax structure which bodes well for the future of value-added agriculture,” Arnt says. “We are confident that going forward the province will be able to attract investment and in turn, create economic benefits for all of Saskatchewan.”
