Canada is one of the world’s most important oilseed producers and exporters, and while the market is steadily expanding and diversifying, canola remains the cornerstone of this sector’s growth. Canadian canola processing plays a critical role in Canada’s economy, especially considering that the commodity crop was developed in — and named after — the country that leads the world in its production.
Leveraging its strengths in crop innovation and canola production, Canada is building out its infrastructure for processing canola and other valuable oilseeds, such as soy. As Canadian processors prepare to meet the surging global demand for healthy vegetable oils, protein-packed meal, and industrial products, the Canadian oilseed market is gearing up for growth.
Here’s a brief look at the key drivers behind the expansion of Canadian oilseed processing and the opportunities this growth can unlock for food, feed, and fuel markets around the world.
Canadian canola processing growth
Canola originated as a Canadian innovation approximately 50 years ago, when crop researchers set out to improve the undesirable characteristics of rapeseed. Like all crops in the mustard family, rapeseed contained high levels of erucic acid and glucosinolate that restricted its use to industrial lubricants. In the mid-1970s, scientists at the University of Manitoba developed new varieties low in these pungent compounds and called their invention “canola,” short for Canadian oil, low acid.
This breakthrough turned a niche crop into a versatile global stable, laying the foundation for Canada’s enduring leadership in canola production and Canadian canola processing. Now planted on more than 21 million acres, Canadian canola harvests yield more than 21 million metric tonnes (MMT) per year. More than half of this canola is crushed domestically to produce nearly 5 MMT of canola oil and 6.8 MMT of meal, contributing billions to Canada’s economy.
The Canadian canola processing infrastructure has the capacity to crush 13 MMT of canola, but new investments are expected to expand Canada’s crush capacity to 15 MMT by the end of the year — supporting more value-added processing opportunities.
Canadian oilseed processing opportunity
While canola is the main driver of growth in this market, the Canadian oilseed processing sector is diversifying into soybeans and other crops, as well. Traditionally, Canada produced premium food-grade soybeans used for foods like tofu and soy sauce, but new crop developments have led to increased production of commodity soybeans, which are processed into oil and meal to supply a wide range of food, feed, and industrial applications.
Although Canadian soybean production pales in comparison to canola, the acreage devoted to commodity soybeans is increasing rapidly to meet rising global demand. While a majority of Canadian-grown soy products are exported, domestic crush continues to grow by leveraging the robust Canadian canola processing infrastructure.
Solvent extraction is the most common method of Canadian oilseed processing, with 14 facilities that primarily process canola. A few small plants in Canada focus instead on mechanical extraction, using chemical-free expeller presses to crush seeds, separating liquid oil from the solid meal.
As processors continue to invest in new equipment to expand their crush capacity, the Canadian oilseed processing sector strengthens its position as a global leader.
The next frontier for Canadian oil
Historically, Canadian oilseeds like canola and soybean primarily supplied edible markets, with the fat becoming cooking oil for human consumption and the solid meal ending up in animal feed rations. Now, emerging industrial uses are fueling a new wave of growth for Canadian oilseed processing.
Biofuel production, in particular, represents one of the biggest opportunities for the Canadian oilseed sector. As the demand for biodiesel and renewable diesel expands across North America and the rest of the world, driven by clean fuel mandates and policy incentives, Canada is well-positioned to supply vegetable oil feedstocks at scale.
Continued growth in biofuel production and other industrial markets reinforces the business case for expanding the Canadian oilseed processing capacity.
Positioned for processing potential
From food and feed to biofuels and industrial products, Canadian oilseeds serve a range of end uses that promise strong long-term growth potential for processors. As the Canadian canola processing sector continues to expand, providing additional capacity to crush other oilseeds along the way, the value of this multifaceted market is projected to rise.
The expanding capacity and growing demand for high-quality oils and plant proteins position Canada as a value-added oilseed processing hub with unlimited growth potential. To capitalize on this potential, processors must be able to pivot between materials and end-use markets. This requires versatile extraction equipment that maximizes oil recovery and operates at peak efficiency.
As the global leader in oilseed extraction, Anderson International is committed to supporting the growth of Canadian oilseed processing. With equipment designed to efficiently crush canola, soybeans, and other oilseeds, Anderson’s systems are ideal for expanding crush capacity in Canada.
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