Deputy Premier and Crown Investments Corporation Minister Dwain Lingenfelter today announced that the province's investment in FarmGro Organic Foods Inc. will boost Saskatchewan's organic food industry by creating jobs, increasing production and providing a new market for organic producers.

"We are very pleased to join with the other investors to help finance this new venture," Lingenfelter said. "The organic food market is growing in our province and internationally and this new processing company will help put Saskatchewan at the forefront of the industry."

FarmGro Organic Foods Inc. will be located east of Regina on a 15-acre site. The $11.3 million flour mill and processing plant will produce organic wheat flours and durum, with an initial milling capacity of close to 16,000 tonnes. It will also clean about 18,000 tonnes of organic grains and seeds annually, and sell them internationally. The company will employ between 18 and 25 people.

"Our long-range vision is to develop an organic food processing village for one-stop shopping," said Gerry Liski, President and CEO of FarmGro. "We anticipate the future will include private labeling and branding of retail sized bags of flour, grains, seeds, organic pasta, frozen dough bakery products, soup mixes and frozen entrees." CIC is investing $4.4 million in the project through equity and a term loan. The Saskatchewan Government Growth Fund, through one of its immigrant investor funds, is investing $2.5 million in loans in the project.

"SGGF provides capital to help companies like FarmGro get started or to grow," said Gary Benson, President of SGGF. "We believe this new company has the potential to provide long-term economic benefits for Saskatchewan."

Other investors in the project include: private Saskatchewan entrepreneurs; a Japanese company which trades in food and other products; a Czech supplier of flour milling equipment; a federal/provincial partnership agreement on water-based economic development; Western Economic Diversification; and the Farm Credit Corporation (FCC).

"Today's farmers are facing increased competition in a rapidly expanding global economy," said Terry Kremeniuk, Vice President of Agribusiness for FCC. "Organic production is one way to gain a competitive edge because the demand for organic products is growing all over the world. FarmGro will give local producers access to markets close to home and new opportunities to increase business."

"Our investment in FarmGro is consistent with CIC's and the government's investment strategies, which target value-added agricultural projects," Lingenfelter said. "We are confident that this is a good, solid investment and that FarmGro will be successful."

Construction of FarmGro's mill and processing plant will begin immediately. Production is expected to begin in January 2000.

Ted Boyle
Executive Director, Communications
Crown Investments Corporation
Regina
Phone: (306) 787-9039

Gerry Liski
President and CEO FarmGro Organic Foods Inc.
Regina
Phone: (306) 751-2440

Gary Benson
President SGGF Management Corporation
Regina
Phone: (306) 787-7228

Terry Kremeniuk
Vice President, Agribusiness Farm Credit Corporation
Regina
Phone: (306) 780-8671