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North West Terminal - Photo The Western Producer
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North West Terminal Ltd, near Unity, Sask. continues to sit idle after suspending all grain purchases from farmers and letting its primary elevator license expire with the Canadian Grain Commission last September. Photo: File
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A founding shareholder questions why the board approved raises for executives while the terminal incurred $28 million in cumulative losses since 2016

North West Terminal Ltd. is being tight-lipped about what is happening with the idled grain company.

The firm held its annual general meeting on June 18, but chief executive officer Jason Skinner refused to divulge what was discussed at the AGM.

“We’ll just go no comment because we’re in negotiations on some things,” he said.

NWT announced in September 2024 that it was idling the company’s grain elevator located near Unity, Sask.

“Significant headwinds in the grain industry have resulted in negative margins for the grain division the past several years and are expected to continue in 2025,” the firm said in a press release.

NWT suspended all grain purchases from farmers and let its primary elevator license expire with the Canadian Grain Commission.

“Management expects the elevator to remain idled indefinitely until either grain industry margins improve, or part or all of the elevator is sold,” it stated in the press release.

Skinner and his executive team have come under fire by Andre L. Blais, a founding shareholder and inaugural board member on NWT.

Blais recently told SaskToday that NWT has incurred $28 million in cumulative losses since 2016 and has a loan with the Bank of Montreal for more than $41 million.

Meanwhile, Skinner’s salary climbed to $427,000 per year in 2024, from $400,000 in 2022, while the chief financial officer’s salary more than doubled to $192,000 from $93,000 over that same timeframe.

“We want to know why BMO continues to lend to a company with repeated losses, why the board approved salary raises to the executives while we absorb massive losses, and why the NWT was never placed in receivership to protect shareholder equity,” Blais said.

Skinner declined the opportunity to respond to Blais’s comments.

Brenda Tjaden, a farm advisor with Prairie Routes Research, said in a recent article for her subscribers that NWT was a formerly well regarded and profitable business that incurred some steep losses in recent years.

The company is not alone. The past decade “ushered unprecedented financial pain” across the entire grain industry, she said.

For example, the Canadian Grain Commission recently paid out more than $17 million to farmers for eligible unpaid deliveries to Purely Canada Foods Corp. There was another $6.8 million in ineligible claims.

Tjaden said more established and much larger grain companies are also suffering, as witnessed by employee layoffs.

She believes the problem is that Canada’s grain sector has been overbuilt following the demise of the Canadian Wheat Board with money flowing in from overseas grain companies and sovereign wealth funds.

That has resulted in negative margins.

“These cycles used to last three to five years in the grain industry, but right now we’re going on seven to eight years of consistently negative grain handling margins … and discovering the end of the cash flow runway for the least resilient companies,” she said.

Tjaden said the larger, established grain companies have benefitted from diversifying their business dealings with farmers, adding fertilizer and crop input sales to their operations.

Other companies have focused solely on grain handling and only for big volume crops like wheat, soybeans, canola and peas.

The problem is that the price of those crops are closely linked to United States commodity futures, which have been “vulnerable to prolonged heightened volatility and weakening demand.”

NWT began operations in June of 1996. The company is owned by approximately 1,000 farmer shareholders, the company’s website said.

The inland terminal in Unity can store 2.3 million bushels (63,000 tonnes) of grain.

The company owns a 25 million-litre-per-year fermentation and distillation facility, which continues to operate.

NWT is a minority owner of Alliance Grain Terminal Ltd. (AGT) in Vancouver, B.C.

AGT is co-owned by Parrish and Heimbecker and Paterson Global Foods. The facility has an annual capacity of three million tonnes.

Sean Pratt is a reporter with the Western Producer.