Growing From Here: Alberta Food, Beverage and Agribusiness on Display

December 20, 2022

Written By Jesse Fontaine and Xaverie MacLennan

The 2022 Growing From Here Summit (GFHS) recently took place in Nisku, Alberta, bringing together agriculture and food businesses, government and stakeholders to learn from experts and champion regional growth in Leduc County and surrounding areas. With a focus on sustainability and growth in agribusiness, GFHS offered a forum for the Edmonton-area community to explore innovation in the agribusiness and food space in collaboration with other stakeholders.

GFHS combined panel discussions with an economic update for the agribusiness cohort by ATB Business Banking's head of agriculture to deliver effective conversations related to food and sustainability. Albertans' shifting preferences towards food delivery during the pandemic indicated an interesting window of opportunity for agribusiness entrepreneurs, as food and consumption patterns have become increasingly transactional.

In this blog, we summarize our key takeaways from GFHS.

Enabling Sustainability Through Innovation

The intersection between food and sustainability is front of mind for agribusiness operators and technology founders in the Edmonton area. One quote from a panellist offered an exciting outlook for the possibilities of sustainability in agriculture processes.

1. Sustainability is a Competitive Advantage
   
   The panel discussions made it clear that the shift towards sustainable food systems will require an increased measure of comfort with failure, which allows innovators to construct technologies that will drive change in economics and policy.
   
   
2. Food Preservation as a Competitive Limit
   
   While sustainability of agribusinesses may provide a competitive advantage, preservation of food products serves as a competitive limit for producers. Certain panellists identified improved preservation practices as a boost for Canadian food security. Reliable access to a sufficient quantity of affordable, nutritious food was a major focus of GFHS, in light of rising inflation and shifting forces affecting Canada's supply of operational inputs and labour.
   
   
3. Growing Demand, Rising Costs
   
   ATB Business Banking's head of agriculture emphasized the growing demand and rising costs producers face due to ongoing conflict in the Ukraine and associated sanctions affecting Russia, which has contributed to a global shortage of nitrogen fertilizer. This is further compounded by the high cost of natural gas which has led to European fertilizer plant shut downs, further shorting supplies. Additionally, rising labour costs continue to offset significant growth opportunities for food and agribusiness. These and other economic factors have increased public scrutiny on food security, sustainability and affordability.
   
   Despite volatility in the global economy, Canada faces exciting growth opportunities in the agribusiness and food sectors by continuing to increase exports, emphasizing protein excellence through organizations such as Protein Industries Canada¹ and using its readily available light and energy resources to promote vertical farming and indoor growing. Carbon markets and regenerative agriculture are additional sources of potential growth for Canadian agriculture. Considering Canada imports approximately 85 percent of its produce, agriculture represents a burgeoning sector in terms of capital and innovation, particularly for Canada's western cohort.
   
   
4. Specialized Facilities and Expertise
   
   Attendees at GFHS received an education regarding three Government of Alberta facilities in Edmonton and Leduc, each of which are geared toward the commercialization of food, beverage and ingredient manufacturing companies:
   • the Food Processing Development Centre (Leduc);²
   • the Agrivalue Processing Business Incubator (Leduc);³ and
   • the Bio Processing Innovation Centre (Edmonton).⁴
   Panellists unanimously celebrated successes using these facilities, which offer opportunities to test-drive business operations at scale. GFHS attendees observed that agriculture opportunities span beyond food into the materials, beauty and packaging sectors, among others.
   
   Alberta's investment into local processing capacity is as a value add even beyond the Edmonton area. In Southern Alberta, nearly $1 billion is being invested into irrigation systems, with the goal of expanding total productive acres. As these expanded acres are farmed, the increased production must also be coupled with expansion of appropriate processing facilities.
   
   
5. Alberta's Role and Opportunity
   
   With its breadth of agricultural lands, rich soil quality and entrepreneurial spirit, Alberta has long been an agricultural powerhouse and continues to hold a unique position as a key player in the future of food and sustainability. That said, a number of important questions about Alberta's agricultural future remain. The escalating costs of agricultural capital projects, construction materials and labour costs complicate scaling capacity for food processing. Additional layers of complexity exist when considering regulation at the federal, provincial and municipal levels. These challenges can be further compounded by trends in international markets, as global integration is a key driver of growth in this industry.

Conclusion

Given these concerns, it is promising to see investment into innovation, export market development and regulatory efficiency which together create tremendous opportunities for the establishment of agriculture processing facilities in Alberta.

For questions regarding agribusiness, food and sustainability, please contact one of the authors or a member of the Bennett Jones Capital Projects group.

Authors