UPDATE 1-Louis Dreyfus Canada plant may resume canola crushing in 3-7 weeks

Fri Oct 31, 2014 12:42pm EDT
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(Adds comments about impact on markets, buyers, farmers, paragraphs 3-9; adds byline)

By Rod Nickel

WINNIPEG, Manitoba Oct 31 (Reuters) - Louis Dreyfus Corp's Canadian canola plant may resume receiving and crushing the oilseed in three to seven weeks, following last week's explosion and fire, the president of the global grain trader's Canadian unit said on Friday.

Brant Randles, president of Louis Dreyfus Commodities Canada Ltd, said the company is working with contractors and engineers on a work-around solution to allow the plant's operations to resume.

An investigation continues into the cause of the Oct. 24 blast at the Yorkton, Saskatchewan, plant.

The plant is one of two in the area, along with one operated by Richardson International. It has capacity to crush up to 1 million tonnes of canola per year after a recent expansion.

The shut-down comes as farmers have completed the harvest in most areas. Randles said the closure has not had a noticeable effect on canola cash or futures prices.

Farmers have been slow to sell their crops, causing prices to rise, he said. ICE Canada nearby canola futures have settled higher for four straight sessions prior to Friday.

Input Capital Corp, a company that buys farmers' canola crops for resale, said on Tuesday the explosion would delay its deliveries but not have a material impact. Input's shares have gained about 7.5 percent since Oct. 23.

Louis Dreyfus crushes canola to produce oil mainly for U.S. buyers, and meal for U.S. dairy farmers. Canola oil is used in foods like salad dressing and margarine.

"We've had an active communication program with both the sellers of canola and the buyers of canola meal and oil," Randles said. (Reporting by Rod Nickel in Winnipeg, Manitoba; Editing by Chizu Nomiyama and David Gregorio)