McCain to spend $600M to double potato processing capacity in southern Alta.

McCain's doubling potato processing facility McCain Foods will spend $600 million to double the size of its potato processing facility in southern Alberta. Quinn Keenan reports.

French fry giant McCain Foods Ltd. has announced it will spend $600 million to double the size of its potato processing facility in southern Alberta.

The Toronto-based food manufacturing company — which boasts that it makes one in every four French fries produced worldwide — is making the largest investment in its history in order to double output at its Coaldale facility, just east of the city of Lethbridge.

McCain said the project will create two new production lines, one for French fries and one for other frozen potato specialty products. Once completed, the expansion is expected to create 260 new jobs, more than doubling the facility's current workforce.

"We are projecting strong volume growth over the next five years and need this expansion to accommodate the expected growth," said McCain Foods CEO Max Koeune in an emailed statement.

Koeune attributed part of the expected growth to continued recovery in the restaurant and hospitality sector. Demand for French fries and other frozen potato products collapsed in 2020 due to the COVID-19 pandemic and restrictions on in-person dining.

The expansion also speaks to the company's confidence in the future of Canadian agriculture, Koeune said. The company has contracts with Alberta potato farmers, the majority of them in the Lethbridge region, to supply the Coaldale facility.

"Doubling our production capacity in Coaldale will bolster strong relationships with our farmers today and into the future," Koeune said.

McCain said the expansion, for which construction is expected to begin later this year, will also have a heavy focus on environmental sustainability. The project includes plans for wind turbines and solar panels to provide 100 per cent renewable electricity to the facility, as well as the use of renewable biogas generated at the site's wastewater treatment facility to offset natural gas demand.

In 2021, McCain made a commitment to regenerative agriculture, pledging that by 2030, it will only source potatoes from farms employing practices that actively seek to improve and revitalize soil health and quality.

Federal government statistics show that potatoes are the fifth largest primary agriculture crop in Canada, after wheat, canola, soybeans and corn.

In 2021, potato growers across Canada produced approximately 5.7 million tonnes of potatoes, with Prince Edward Island being the top potato-producing province followed closely by Manitoba and Alberta.

'DELIGHTED': COALDALE MAYOR REACTS TO ANNOUNCEMENT

Coaldale Mayor Jack Van Rijn was pleased with Monday's announcement.

"As a municipality that neighbours McCain's foods, we are very delighted that they decided to do this huge expansion in Lethbridge County," Rijn said.

Lethbridge County Reeve Tory Campbell, meanwhile, says he sees it as a huge win for the region.

"Not only is it obviously jobs, opportunity, investment in the county… but also investment in our surrounding communities throughout southern Alberta," Campbell said.

Trevor Lewington, CEO of Economic Development Lethbridge, says he believes the investment by McCain's may not be a one-off.

"I think you'll definitely see the other potato processors in the region step up and take notice," he said.

"That's certainly Cavendish, Lamb Weston and even Frito Lay PepsiCo foods has their chip plant in Taber."

- With files from Amanda Stephenson, The Canadian Press