A local tire processing facility is permanently closing after contract negotiations broke down between the provincial regulator, Tire Stewardship Saskatchewan (TSS) and Shercom Industries.

“We sent out a release this morning with, I guess sad, in some regards shocking news that we are forced to permanently shut down our entire processing activities,” said Shercom president Shane Olson yesterday. “That is a direct result of the direction that the tire program is taking with regards to the penalization of value-added products in this province.”

The company shut down part of its operations in May 2023 after losing a significant share of the province’s tire recycling contract to American-based Crumb Rubber Manufacturers (CRM), which opened a plant in Moose Jaw.

Olson argues that Shercom was unique in that it could process the tires and manufacture products for sale, where CRM only shreds tires and exports them out of province.

“We cant even buy crumb rubber from them because theyre not making any,” he said. “They are simply taking the tires from Saskatchewan, shredding them into large chunks and exporting them out of the province.”

Even as the sole processor in the province, Shercom imported crumb rubber to support its manufacturing because there wasnt enough material. Olson says a TSS study that supported two processors had never been provided, but through the Freedom of Information Act they had obtained the report.

“The 22-page report that they claimed to support two processors had been 100 percent redacted. So we got 22 blank pages,” he said.

Olson says the company will continue its manufacturing, but Shercom’s multi-million dollar investment into its processing facility will shut down.

“We will no doubt be looking at selling all of our processing plant which will most likely go down to the U.S.,” said Olson.

In a statement, the Ministry of Environment said it was disappointed an agreement couldn’t be reached between Shercom and Tire Stewardship of Saskatchewan.

TSS declined to comment, but responded via email.

“TSS has not been told by Shercom Industries Inc. directly that they are ending contract negotiations. Until we’ve received official notice from them, it would not be appropriate to respond. TSS looks forward to issuing a public statement once negotiations conclude.”