Ethanol plant will double output
Construction in Lakota will start this fall
By Jean Caspers-Simmet
LAKOTA, Iowa -- Midwest; Grain Processors Cooperative at Lakota will double the capacity of its dry-mill ethanol plant to 100 million gallons per year.
Construction will begin this fall, said Scott Swanson, manager of commodity risk and marketing for the cooperative. The contractor and project cost are still being negotiated.
"The project will be in the ballpark of $40 million,'' Swanson said.
People will see additional grain storage and a couple more fermenters, but the footprint of the plant will not change much with the expansion, Swanson said.
The plant was built in 2002 and has been operating for 18 months.
"The ability to expand was built into the original design,'' Swanson said. "We see the opportunity to continue to increase the amount of alcohol we're marketing in the United States. This is a strategically strong area for originating corn. The economics point to a natural move forward.''
The plant processes 17 million bushels of corn into 50 million gallons of fuel grade ethanol and 145,000 tons of distillers grain each year. The numbers will double once the expansion is complete next summer, Swanson said. The distillers grain is marketed throughout the country as well as being exported.
Demand for ethanol continues to grow with the cooperative adding new markets every few months, Swanson said. Baton Rouge, La., and Atlanta and all the pipelines feeding these areas will be switched over to ethanol by Jan. 1. Eastern states made the switch a year ago, and ethanol has been mandatory in California for a year.
The ethanol cooperative has 38 employees and will hire another 10 full-time workers to operate the larger plant. Up to 100 construction workers will be on site during the building phase.
"It is very gratifying to benefit the local economy by creating well-paying jobs and increasing the demand for corn, and at the same time benefiting the nation by enhancing and extending our gasoline supply with a clean-burning renewable product,'' said Dave Nelson, MGP's board chairman and a Belmond farmer.
Swanson said having the ethanol plant operating in northern Kossuth County has added 3 to 4 cents to the price of a bushel of corn.
Midwest Grain Processors is owned by 1,000 farmers, primarily from Iowa, Illinois and Minnesota. Discussions have been held about expanding MGP's ownership base, but no decision has been made about having another stock offering, Swanson said.