Thursday, March 30, 2006
Nature: Biodiesel
I just thought this was interesting. Nevada, Mo is not too far from where I grew up.
Biodiesel gets green light
The Joplin GlobeBy Chadwick Watters
Globe Staff Writer
NEVADA, Mo. - More than 1,000 area farmers have pledged $34.2 million so far to build a biodiesel plant in Vernon County.
Officials with Nevada-based Prairie Pride Inc. said this week that they have enough money invested to begin construction of the plant later this year. The plant would turn about 21 million bushels of soybeans into 30 million gallons of biodiesel per year beginning in the fall of 2007, according to Russell Johnson and Marvin Oerke, members of the group's board of directors.
Biodiesel can be used up to a 20 percent blend in any diesel engine, Johnson said. Some engines, such as those used in mining and shipping, can use 100 percent of the fuel.
Oerke said the plant will contain both a soybean processing plant and a biodiesel refinery to convert soybean oil to the petroleum alternative. The plant also will generate about 467,000 tons of soybean meal each year. The meal, a high-protein animal feed, is worth more than the biodiesel at current prices, Johnson said.
Johnson estimated that the plant could raise the local price of soybeans by about 12 cents a bushel.
Alan Washburn, a Lamar grower, hasn't invested yet, but he is considering doing so. He said he believes the increase in soybean prices would be worth the $1,000 minimum upfront payment, but that is just the first step for investors. Each investor also must promise to put in at least $20,000 after initially signing on, Johnson said.
"It's a good deal," Washburn said. "It will take a lot of beans to run it, and it's bound to help on the price."
Soybeans were down to about $5.30 per bushel on average this year, compared with $6.75 last year, he said.
The project will cost at least $85.5 million. Prairie Pride still must approve a lending institution as a senior lender to help provide much of the capital for the project. The member investors compose about 40 percent of the needed investment, Oerke said.
Johnson said the company also has received grants from the U.S. Department of Agriculture, and it is applying for more federal and state grants.
The company also needs to get a permit for the plant from the Missouri Department of Natural Resources. Permit approval and a groundbreaking could be about 90 days from now, said Oerke and another board member, John Nelson.
Johnson said Prairie Pride has a letter of intent with Alert Construction, of Fredonia, Kan., for the plant's construction.
Prairie Pride will directly buy beans from its members, including grain elevators and co-ops. It may have to buy additional beans from outside the member pool in short crop years, Johnson said. The company has contacted some area animal farming operations about selling the feed, but it has not made any permanent agreements. Johnson said most of it likely would go to southern Missouri or Arkansas.
"(The plant) does nothing but help the farmer," Washburn said. "Any time we can market something that we can regrow year after year and keeps us from relying on petroleum supplies so heavily ... is good for U.S. farmers, and it's good for the environment."
