GrainCorp Investing $50 Million to Create Oilseed Hub
GrainCorp announced that it is investing $50 million to expand its oilseed crushing capacity at its Numurkah facility in Victoria, Australia over the next two years. The group plans to develop a strategic oilseed sourcing, crushing, processing, and refining hub to increase supply to export buyers and enhance regional competitiveness with imports.
This latest project involves installing state-of-the-art extraction technology that will deliver significantly higher oil yields than current extraction processes. The initial expansion will increase crushing capacity by 40% to 1,000 tons per day, but engineered into the project will also be the ability to rapidly and cost-effectively expand capacity to 1,400 tons per day if demand continues to grow. The facility will also be structured to produce canola meal to supply local poultry, dairy, and livestock producers.
"Demand for healthy oils based on canola and other oilseeds continues to grow in Australia, and we are also experiencing steady export growth," managing director Mark Palmquist tells The Land.
Over the past three years, Australian canola oil exports have increased more than 25% as Asian consumers become more health conscious, and with the recent signing of free trade agreements, GrainCorp expects export opportunities to grow even further.
Financially, the investment, which is being funded with existing cash and debt facilities, is expected to generate an additional $10 million to earnings before interest, tax, depreciation, and amortization (EBITDA) from 2017/2018 onward.