CRESCO, Iowa — Dave Sovereign tries to help people see the benefits ethanol brings to the economy.
Sovereign is involved in a diversified family farming operation started by his grandfather, Gerald, who is now deceased. The Howard County operation includes his father, Lowell, and uncles Wayne and Merle. Dave, his brother, Gary, and cousins Rick and Steve make up the third generation. Justin, Gary’s son, and Brad, Rick’s son, joined the operation last year as the fourth generation.
"We have three employees who were hired in 1968 or 1969 who we might as well say are family members," Sovereign said.
Everyone gets together at the elevator shop north of Schley for coffee every morning.
The Sovereigns have a grain elevator, a grain trucking business, a farrow to finish hog operation and raise corn and soybeans.
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"The last couple of years all the corn has gone to local ethanol plants," Sovereign said. "That has changed things dramatically."
Sovereign is chairman of the board of directors of Golden Grain Energy, a Mason City ethanol plant. Sovereign is an investor in Absolute Energy, a St. Ansgar ethanol plant; Homeland Energy Solutions, a Lawler ethanol plant; and what was originally Midwest Grain Processors and is now Green Plains Renewable Energy at Lakota. He is Golden Grain’s representative on the board of Absolute Energy.
"The ethanol industry is still relatively new and there is a lot of growing going on," Sovereign said. "There are always technology improvements, and we’re constantly tweaking the process itself."
Sovereign said the diversified producers who raise corn, soybeans, hogs and/or cattle are in the best position to capitalize on the markets.
"It goes back to my grandfather’s time," Sovereign said. "Now guys take their corn to the ethanol plant and bring back distillers at a percentage of what the cost of the corn would be, about 75 to 78 percent of the value of corn. They feed that to the hogs and behind that you have manure from the hogs that’s applied at proper rates to replace nutrients. A lot of commercial fertilizer is derived from foreign oil. It’s quite an asset and it’s good for the soil."
Sovereign said that in 2010, Golden Grain, Homeland Energy Solutions and Absolute Energy each paid $6 million to shareholders.
"Collectively that’s almost $20 million that went to northeast and north central Iowa shareholders who invested in these plants," Sovereign said. "That has to make a positive impact. That money added to the economy in every county in north central and northeast Iowa."
It frustrates Sovereign when people bash ethanol.
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"After 9/11 the president and Congress asked all Americans to do what they could to eliminate our dependence on foreign oil," Sovereign said. "Community leaders came together and worked together to get these plants up and running. A great deal of capital was raised in these communities, and we built an industry that is now 10 percent of the U.S. fuel market. It’s a 13 billion gallon industry. We’re replacing over 445 million barrels of oil per day."
Sovereign said recent studies by Iowa State University, Merrill Lynch and the Department of Energy show that motorists save 15 to 50 cents a gallon on fuel because of ethanol plants.
"That translates to $150 to $450 per year for every driver in a family," Sovereign said.
