Posted on 08 December 2011 by admin
Most Canadians are well aware of the big problems facing our neighbours south of the border – a dysfunctional government, the highest unemployment rate seen in decades, a seemingly intractable fight over taxation, out-of-control debt levels and the world’s most vicious partisan politics.
But Americans still embody a can-do attitude that has saved them in the nick of time again and again. Currently Tim King, president of Carbon Cycle Crush in Oroville, seems like a perfect example. King is promoting his new company, which is a relatively small scale canola crusher that cost between $2 and $3 million to set up. It will provide this small community of 1,700 with jobs, environmentally sound renewable products that will benefit local farmers and, if things work out the way he wants, will have a small carbon footprint.
King used to work for the U.S. Department of Agriculture in the soil conservation service for the better part of two decades. It was while he was in that position back in 1976 that he first thought about the benefits of a sustainable, small-scale oil seed crusher.
King explained that sustainability is a tripod. The three legs are environmental, social and economic sustainability. Without all three of them no operation is truly sustainable.
In an agricultural setting that means jobs must be local and ongoing, it must be a viable business generating cash and it must be healthy for people and farms, including the soil, and it must provide a decent income. It should also have a minimum of pollutants associated with the process, which is where his criticism of mass canola crush operations begins.
Standard procedure for making canola oil consists of crushing number one seed, which squeezes out about 80 per cent of the oil. What’s left over is a mush known as the canola cake.
To extract the next 19 per cent, the cake goes through a chemical wash using hexane, which is a colourless solvent found in gasoline. Then it is heated to vaporize the hexane, deodorized to remove any trace of the hexane smell and bleached to make it clearer.
While King claims the processing is only about aesthetics, it is more accurately driven by economics. Getting that last 19 per cent of the oil is the big payoff. Additionally, canola used for human consumption is No. 1 canola, but canola that is slightly under ripe contains chlorophyll, which makes the oil bitter tasting. The process helps to eliminate that chlorophyll.
In his model King wants two end products. One is yellow oil that is not for human consumption. Instead he sees the oil being used for lubricants (motor and 2-cycle engine oils), cleaning and soap constituents and as a fuel additive. His cake, which contains 20 per cent oil rather than one per cent, will make for much richer and healthier animal feed with much higher omega-3 content.
Part of King’s intent is to provide jobs in his community. The plant, once it is at full capacity should employ around 25 people, but he also wants to share the wealth with local farmers. Ironically there is virtually no canola grown in the area.
Canola, which is a member of the mustard family, grows on 20,000,000 acres of land in Canada. In fact, the word canola is derived from the words ‘Canadian oil, low acid.’
King estimates the plant will need 60,000 to 70,000 acres of canola grown per year once it is going full out.
Ten tons of canola grown by Jim Bunch, a local farmer, were put through at the grand opening of the plant. Bunch has 160 acres, but admitted he is brand new to growing canola. “I’ve never grown it before.”
King has heard estimates that there are 30,000 acres in the region that could grow canola, but three farmers who came to the plant opening said switching over to canola is risky. Bunch agreed, saying, “We’re never going to have a lot of [canola growers].” He believes that if there are 5,000 acres in a decade that would be extraordinary change for local agriculture.
King’s focus for this plant is resolutely American at this stage and he has decided against the obvious solution of constructing any of the startup plants in Canada where there is a great deal of canola.
Instead he hopes to encourage farmers in Washington, Idaho and Oregon to switch to canola. For the short term, he will be importing Canadian grown canola using a loan guarantee from Export Development Canada.
King acknowledged that for Canadian farmers, sending their grain to a startup is risky. If his business deal sours any attempt to get money from him would be complicated by the border. Export Development Canada is guaranteeing the farmers that if King defaults, they will get paid.
King said the money is only enough to get going, but he said Export Development will extend more credit once he proves good on paying the bills. He said, “It is all about building a relationship.”
For Canadian farmers King is paying them three to four cents more per pound than they can get anywhere else for No. 2 and No. 3 canola. It is a winning scenario for the farmers growing canola that has very low value otherwise, but King chafes at the trucking expense, and the carbon footprint, of shipping canola from the Canadian prairies.
He said part of his market appears to be Canadian farmers in the Fraser Valley who want to buy his feed because it is higher quality for less money than what they are buying now.
Ironically, King is using Canadian canola, a Canadian bank loan and will export at least some of his product to Canadian farmers, but is determined his second plant will be in one of three states where he must convince farmers to switch to a new crop.
No matter what happens, his energy and commitment to locals is going to create jobs and opportunities that many people only wish was happening in their community.