IssuesFall 2020A Failed Expansion

    A Failed Expansion


    The Saskatchewan government has previously tried to expand its potato industry — but the project flopped.

    With the recent Saskatchewan government announcement of an irrigation expansion, many in the potato industry are remembering a previous project to increase potato production in the Prairie province.

    In the 1990s, the Saskatchewan New Democrats were in power and decided to start a potato business — the Saskatchewan Potato Utility Development Company (SPUDCO).

    The plan was for the government to use the irrigated area around Lake Diefenbaker to increase acres and establish a potato industry which would eventually attract a french fry processing plant. In 1997, the government constructed seven state-of-the-art, climate-controlled sheds to store potatoes in. The government would grow and market the potatoes themselves.

    “At the time the industry was concerned with the investment that was made. Perhaps, they hadn’t done enough legwork in terms of where the potatoes would be marketed,” Kevin MacIsaac, general manager of the United Potato Growers of Canada, explains in a phone interview.

    The potato market dropped off and along with it, the Saskatchewan government’s plans for SPUDCO — the company went bankrupt in 1999 leaving a mess for those involved. The provincial government estimated its losses at $34.4 million, including the cost of settling a lawsuit. The storage facilities were sold off, with some not in use to this day.

    “Last time I drove through Lucky Lake and I drove by the warehouses that were there… it was the middle of winter and the doors were just open, abandoned. I think that’s a shame,” MacIsaac says. “I hope (the irrigation expansion) works and they’re able to get a good business plan together for the product and supply the food we need.”

    Over the years there have been some businesses who have tried to make use of the storage facilities. In 2017, as the Canadian government prepared to legalize cannabis for recreational use, cannabis company Harvest One bought one shed to grow cannabis in. However, the company has been going through restructuring leaving the Lucky Lake facility’s future in question.

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