South Dakota Ag Connection - New Multi-Crush Facility and Biodiesel Plant Open Soon in Alexandria

South Dakota Ag News Headlines

New Multi-Crush Facility and Biodiesel Plant Open Soon in Alexandria
South Dakota Ag Connection - 05/07/2008

A new multi-crush facility and biodiesel plant in Alexandria will provide area agriculture producers multiple ways to market their oilseed crops.

"A multi-crush facility and biodiesel plant provides multiple revenue opportunities," said Brian Stork, chief executive officer of Hanson County Oil Producers, LLC. "If the markets are right, we'll convert oilseed to biodiesel. If they aren't, we'll sell the oilseed on the vegetable oil market."

The crush facility, coupled with the biodiesel plant, will provide 24 new jobs and bring a new source of economic development to the rural community of about 650, located 50 miles west of Sioux Falls.

"This will have a big economic impact on Alexandria and the surrounding area," said Tom Bell, chairman of economic development in Alexandria. "It will make a big difference for our town, providing new jobs and bringing in new families to our community. Small town America doesn't receive an opportunity like this very often."

Because producers now have local access to a small multi-crush facility, they can process multiple oilseed crops: soybeans, canola, sunflower and specialty oilseed. Byproducts from the crush plant and biodiesel facility will be marketed to area livestock producers.

"We wanted to make this a versatile operation so that we are not at the mercy of the markets," said Paul Iburg, chairman of Hanson County Oil Producers, LLC board of directors. "This creates a closer and more versatile market for many local producers. It allows farmers to produce and process crops other than soybeans."

The biodiesel switch plant has the ability to produce biodiesel from any kind of oil, even animal fat. The crush facility will have multiple lines running at the same time. It will be able to process approx. 10,000 bushels a day as well as smaller volumes of specialty oilseed crops.

Lance Koth, president of First Dakota National Bank in Mitchell, says the versatility of the two facilities makes sense.

"Given the volatility in the commodity markets right now, there is tremendous risk in operating a plant that can only process one crop. Hanson County Oil Producers, LLC can cherry-pick the market," Koth said. "With the multi-crush plant, they can process oilseed crops and sell in other markets when the biodiesel market is not profitable."