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Export Assessment: Flax Seed Straw Fibre Technologies


Josh Weber
AGR*1110-0101
Nov 28th, 2017
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Table of Contents

Part I-Product Info .......................................................................................................................... 3


i) Product Description ..................................................................................................................... 3
ii) Location Grown and Processing................................................................................................. 5
iii) Inputs Required and Issues........................................................................................................ 6
iv) Machinery and Labour .............................................................................................................. 7
v) Benefits to Rural Canada and Market Opportunity .................................................................... 7
vi) Environmental Sustainability .................................................................................................... 8

Part II-Export Potential to the United States................................................................................. 10


i) Transportation Logistics ............................................................................................................ 10
ii) Storage Issues and Export Documentation ............................................................................... 11
iii) Cost Analysis........................................................................................................................... 11
iv) Benefits to Importing Nation ................................................................................................... 12
v) Real World Contacts ................................................................................................................. 13
vi) Regional and Global Competition ........................................................................................... 14
vii) Future Studies and Unknowns ................................................................................................ 14

Recommendation .......................................................................................................................... 15
Bibliography ................................................................................................................................. 16
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This paper evaluates the export potential of flax seed straw fibres exported from Canada

to the United States in hopes to enhance and recommend ideas to potential Canadian exporters.

Details of the benefits and potential setbacks are laid out in two sections; Part I-Product Info and

Part II-Export Potential to the United States. Many factors were analyzed including

transportation, sustainability, and market values. Overall, flax straw is an excellent product to be

exported for use in the fibre industry, although more research should be conducted to improve

sustainability of the industry.

Part I-Product Info

i) Product Description

For many farmers in the rural Canadian prairies, growing flax for linseed oil production is a large

industry. The market is also growing due to use of organic flax for healthier baking ingredients,

including high protein and omega-3s. Growing flax has one setback and that is straw residue left

on the field. Flax straw has long, tough stem fibres that decay slower than other crops, this makes

it very difficult to work into the soil as it plugs up tillage and planting equipment. Farmers have

even resorted to using straw choppers, gathering straw into windrows, and burning it on the open

field (Flax Council of Canada 2, 2017). Straw by-product in western Canada leads to major

environmental problems with disposal, burning an estimated 85% of excess straw (Faulk et al.,

2002). Finding an alternate use for the crop residue waste product is an important fix and many

companies have found a solution. Flax can be used in various textile productions as a

strengthening agent. It is a plentiful, natural plant source that can be developed into strong short

fibres (Flax Council of Canada 3, 2017). Flax fibre has been used for 1000s of years for cloth

textiles but has recently be used as an alternative technology for fibreglass in composites. Flax
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has a lower cost to separate fibres and has uniform colour, strength, length, and fineness (Faulk

et al., 2000). It is now used in a vast variety of products such as, biofibres, paper pulp, outdoor

geotextiles, synthetic wood products, plastic composites, car door panels, plant pots, retaining

mats, fine cigarette bond paper, cotton substitute, animal bedding, horticultural mulch, particle

board, insulation, heating fuel, etc (Flax Council of Canada 2, 2017).

There are many benefits to products made with flax fibres. Flax is used to make paper pulp and

is stronger and longer than wood fibres, allowing smaller amounts of material to be needed (Flax

Council of Canada 1, 2017). Flax pulp and paper products are also more resistant to tearing and

stronger when wet (Thompson et al., 2015). In geotextiles, flax fibres are used as a natural mesh

source to reduce dust and erosion during construction and on road sides (Flax Council of Canada

1, 2017). Flax fibres have a very similar structure to cotton and are processed the same way. The

flax fibres benefit because they can absorb 50% more moisture, leaving flax clothing cooler and

drier than cotton (Flax Council of Canada 1, 2017). Flax fibres can also importantly replace

fibreglass in plastics because it is stronger, lighter, and cheaper. The flax shows less deterioration

when exposed to high temperatures of 190-250C in the injection molding process, and becomes

harder and stiffer when exposed to stress (Hornsby et al., 1997). This shows large market

increase for interior and exterior car parts such as door panels, engine covers, and trim. Figures 1

and 2 below illustrate what products are produced from different parts of the flax straw. There

are a large variety of uses for flax straw and that is why it provides such huge potential for

market increase.

FIGURE 1
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(Thompson
et al., 2015)
FIGURE 2 (Thompson et al., 2015)

ii) Location Grown and Processing

Flax is a winter crop grown in cooler conditions more fit to Canadas climate patterns. Most flax

is grown in the rural Canadian prairies in the lower portions of Alberta, Saskatchewan, and

Manitoba. These production areas are shown in Figure 3 below. The flaxseed industry generates

254,260,000 dollars in farm receipts annually, showing a large market (Statistics Canada, 2016).

The steps of the production process include harvesting oilseed flax with a regular chopping grain

head, field drying the straw, windrowing, baling the straw, and transporting to the processor. The

straw consists of pectin which holds the fibres together like glue and it will be retted or

deteriorated with commercial enzymes at the processor to save time and add more precision than

biodegradation from weather and microbes. Higher quality straw is evaluated on cleanliness,

height, diameter, strength, consistency, fibre content, percent of retting, and amount of
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contaminates (Flax Council of Canada 1, 2017). Fields yield a range of 0.3-2.0 tonnes of straw

per acre (Flax Council of Canada 1, 2017). If the market of flax straw textiles takes off values of

straw residue available might be in jeopardy. Due to Canadas large production levels of flax it is

in an ideal fit for the fibre

processing market.

FIGURE 3

(Canadian Grain

Commission, 2014)

iii) Inputs Required and Issues

To ensure that enough flax straw is produced to meet industry requirements many crop growth

practices must be conducted. To increase production, farmers can practice regular crop

management techniques such as fertilizer and nutrient application, pesticide use, increased

planting population, selected plant genetics, and hope for ideal climate patterns of moist, warm

summers (Flax Council of Canada 1, 2017). A higher planted seed population with narrower

rows is proven to reduce weed competition while also producing a finer, higher fibre content flax

stem (Flax Council of Canada 1, 2017). When summers are moist and warm higher yielding fibre

contents have been recorded (Flax Council of Canada 1, 2017). This is a field crop product and

that leads to issues of seasonality because the crop will all be harvested in late fall and early
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winter, potentially leaving the market short on resources while waiting for the next harvest to

begin. In order to keep up to demand, the production levels of flax straw will have to be

monitored and increases accordingly.

iv) Machinery and Labour

Canadian company SWM has paid $5-10/tonne of straw in the past plus all collection labour

costs and Canadian farmers could see an increase to $20-80/tonne if the market takes off (Flax

Council of Canada 1, 2017). Prices range by several values for quality of the straw. To bale the

straw, a tractor and straw swath will be used to collect the straw into windrows. A tractor and

straw baler will then be used to collect of the straw into compact square bales. The bales will

then need to be loaded with a front loader onto a tractor trailer. All this equipment costs hundreds

of thousands of dollars but will be owned by the private farmer or by the collection company.

The average agricultural worker in Canada makes $23.96/hour, but baling the straw would not be

a full-time occupation (Statistics Canada, 2017). The processor then separates the straw into fibre

and shive using commercial cleaning, cotton gin machinery, and commercial enzymes. This is

more efficient and cost manageable at producing fibres than strictly dew or chemical retting the

straw (Anthony, 2002). Initial costs of processing plant setup will be large but after a couple

years of production input costs will be feasible.

v) Benefits to Rural Canada and Market Opportunity

Removing the tough flax straw residue from the rural farmers fields is a benefit to their yields

and time management. They are also able to make extra profit off the flax seed crop as straw

residue normally went to waste. Flax fibre is currently a niche product that can be used in various

textile productions as a strengthening agent. With the organic flax, flax oil, and flax protein

markets growing steadily and hardly being able to keep up to demands, the niche market of flax
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straw residue should grow in sync. Trucking companies in Canada will also benefit as they will

get more shipments and potentially need more employees. Canada is the top flax producer in the

world, accounting for approximately 40% of global flax production (Government of Manitoba,

2011). Increasing the flax market in Canada can only benefit our export statistics.

vi) Environmental Sustainability

Fields vary in straw yields from 0.3-2.0 tonnes/acre (Flax Council of Canada 1, 2017). It is

estimated that the value of salvageable oilseed flax straw in the Canadian prairies is between

500,000-1,000,000 tonnes (Flax Council of Canada 1, 2017). This is enough to supply the

current industry as one of the largest companies, SWM, process 75,000-250,000 tonnes annually

to a range of 60-80% fibre content. SWM expects their demand to be steady through to at least

2020 (Flax Council of Canada 1, 2017). Canada should be able to meet this demand as they are

the top producer in the world, accounting for approximately 40% of global flax production

(Government of Manitoba, 2011). But flax fibres will also reduce wood use, saving depleted

forestry. The composites and production waste are environmentally friendly and are able to be

recycled or remanufactured (Faulk et al., 2000). The composites can also be burned as a fuel

source, as lower emissions are released because it is a natural renewable material (Faulk et al.,

2000). Shown below, in figures 4-6, are the values in tonnes of straw produced and potentially

recoverable in North America. The tables show that Canada has much higher flax straw available

and that this market can be sufficient in Canada.


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FIGURE 4 (Thompson et al., 2015)

FIGURE 5 (Thompson et al., 2015)

FIGURE 6 (Thompson et al., 2015)


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Part II-Export Potential to the United States

i) Transportation Logistics

Barr-Ag is a hay-grain exporter located on the Eastern slopes of the Rocky Mountains. They ship

straw and hay in various bale sizes and ship mainly through the Chicago border. Their processed,

smaller hay packages are loaded on pallets and stretch wrapped while open trailers hold 58 bales

(Barr-Ag, 2017). They do not currently ship flax straw, but will easily be able to expand and

accommodate the industry. Barr-Ag would not release financial information, but the cost of

shipping varies. Statistics Canada paper on cross-border trucking shows that transporting straw

and other animal feed products costs an average of $1.37/km (Anderson and Brown, 2009).

Economic feasibilities would be cut down the closer processors are to the supply. The majority

of flax straw that is shipped to the United States goes from Carmen, Manitoba to New Jersey for

paper production or to South Carolina to a processing plant (Thompson et al., 2015).

Transportation plays an influential role in the cost of the product and any way it can be reduced

will benefit revenues.

FIGURE 7: Map of North America showing main Canadian shipping locations and primary

export destination in the US.


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ii) Storage Issues and Export Documentation

The industry is governed by the CFIA (Canadian Food Inspection Agency) and phytosanitary

certificates must be issued to ship cross border. This certificate is issued by the Horticulture and

Plant Health Division of the Department of Agriculture, Food and the Marine to ensure that all

plant products are regulated and free of pests and pathogens (Department of A.F.M., 2017). Barr-

Ag ensures that all their hay and straw is tarped and stored in proper conditions. They guarantee

mold free with less than 12% moisture, performing their own quality control for these factors as

well as checking for foreign material (Barr-Ag, 2017).

iii) Cost Analysis

Flax straw can be processes through chemical retting at a cost of $0.22-1.10/kg, a price point that

can compete with glass fibres traditionally used in composites (Faulk et al., 2002). All the

equipment used in separating the fibres are currently built equipment used in similar fibre

separating industries such as cotton, making them feasible to the new rising industry. Paying an

employee to bale the straw is not a set back because someone must deal with the straw either

way. The average agricultural worker in Canada makes $23.96/hour and baling the straw would

not be a full-time occupation (Statistics Canada, 2017). The largest set back is transportation

costs to the states. Transporting to Canadian processing plants that are much closer or building a

new plant on the borders edge would drastically decrease costs. On the straw side, increasing the

yield of fibre in the straw from 20% to 40% would be worth about $19.1 million to the processor

(Thompson et al., 2015). This is encouragement to grow a more successful crop stalk. Lower

quality flax fibre, used in products such as papers, runs for $5-10/tonne; where as high-end

fibres, for plastic composites and textiles, run for $50-150/tonne (Flax Council of Canada, 2017).

The farm gate value of the fibre that can be produced is about $560,000-615,000 at $5/tonne
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(Thompson et al., 2015). This suggest that this by-product can economically be collected and

processed with resulting revenues for the farmer and processor.

iv) Benefits to Importing Nation

The wide scope of products that can be made using flax fibres shows promise for the market. The

immense potential for automotive components alone is enough incentive for the United States to

increase their flax fibre use to create these light, cheap, strong products. Flax fibres are proven to

result in less wear on processing equipment than wood or glass fibres, provide more workability

after molding parts, and have low to no health risk (Faulk et al., 2002). The US can also benefit

by operating flax fibre production in the cotton industrys off season so that they can use the

same labour, equipment, and facilities until operations could expand further (Faulk et al., 2002).

Thompson et al. (2015), reported that 23 companies in the states were identified as value adding

to the industry and that 2 research plants are operational. Many jobs are available from collection

right through to the finished products.

FIGURE 7: Visualization of flax fibre companies located in North America


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FIGURE 8: Value added flax fibre processing companies in the US

v) Real World Contacts

The Flax Council of Canada can be contacted to find potential flax farmers willing to sell their

flax straw. Details on the industry from growing flax to flax usage and suppliers can be found on

their website. They are based out of Winnipeg and can be contact at (204)-982-2115. More

information is available on their website www.flaxcoucil.ca.

Barr-Ag is a hay-grain exporter that can be contacted to expand their business to accommodating

flax straw baling and shipping flax straw to processors. They are based out of the Rocky

Mountains and can be contacted at (403)-507-8860. More information is available on their

website www.barr-ag.com.

Schweitzer-Mauduit International is a processor of flax straw and uses flax fibres and pulp in

many commercial products. They are currently the largest company in the industry. Their

headquarters is out of Georgia, US but they also have a contact in Manitoba for their Canadian

operations, (204)-325-7986. More information on their company can be found on their website

www.swmintl.com.
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vi) Regional and Global Competition

Schweitzer-Mauduit International is a very large company already in the flax fibre industry.

They process in Canada and ship to the United States and overseas. They would be large

competition when trying to ship bulk flax straw to the United States for processing. They

currently buy from partner farms adding up to 200,000 acres of flax land, and process 100,000

tonnes into biomaterials and biofuel (Switzer-Mauduit, 2017). If they continue to expand they

will be able to own most of Canadas flax fibre industries inputs.

Flax fibre use is already a large industry in Europe. There are 6 large scale companies with high

demand for fibre that are importing from Canada and the United States. The European market is

expected to grow 40% yearly for flax based insulation and 50% for plastic composites (Flax

Council of Canada 1, 2017).

China is also a large importer of flax fibre and values sent overseas from Canada are increasing.

Hemp by-products are also a rising industry similar to that of the flax industry. These collection

methods are similar and could be incorporated into one collection/transportation company to

increase scale and revenue.

vii) Future Studies and Unknowns

A USDA Flax Pilot Plant in Clemson, South Carolina has been started with funding from USDA.

At the plant, commercial flax cleaning systems will be tested, and research will be conducted on

fibre production, enzyme retting, and fibre quality standards (Faulk et al., 2002). Research is also

being conducted in Canada and at North Dakota State University Flax Institution. ASTM test

methods are being developed to grade the fibres on length, strength, fineness, colour, and trash to

help create an equal marketing standard (Faulk et al., 2002). In Alberta, research is considering
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the optimal time to bale the flax straw and whether not retting the straw over winter is efficient.

This could lead to large pay increases for the farmer if proven successful (Thompson et al.,

2015).

Many challenges are facing the industry including weather, farmer incentive, patience with

respect to new research, and feasibilities. To improve the economic feasibilities of this industry,

transportation costs of flax straw need to be reduced by building processing facilities closer to

the large Canadian market. If the farmer can provide the flax straw with low input of time and

cost to themselves than turning a profit off this by-product is achievable and illustrates incentive

if they can be persuaded to join.

An overall cost of the operations from the collection of flax straw, to regulatory/import duties, to

the fibre end product needs to be conducted to insure all members along the way are turning a

reasonable enough profit to make the industry sensible for growth in the future.

Recommendation

In conclusion, the flax fibre industry shows huge potential for growth. Flax fibre is a

natural renewable product that deliveries a quality strengthening agent for an almost endless

array of products. It is recommended that further research be conducted into the sustainability of

flax straw collection and whether one can get all rural Canadian farmers on board. The market

for the end-product is there and can be expanded with ease; but the economic feasibilities of

collection and processing need to be precisely calculated. Successful expansion of this niche

industry will increase the rural Canadian economy one step further towards that of the booming

urban areas.
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Word Count: 3503

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