Crookston soybean crush facility will benefit northern growers

January 24, 2019 / by AgWeek Categories: Minnesota Soybean Research & Promotion Council, Soybean News

A proposed soybean processing and biodiesel plant in Crookston will bring jobs and value-added agriculture into an underserved part of Minnesota, city officials and industry experts say.

Craig Hoiseth, executive director of the Crookston Housing and Economic Development Authority, said area producers will see better prices for their soybeans with an Epitome Energy soybean crush facility in Crookston. Soybean prices are determined by transportation costs, storage and local supply and demand conditions. Being closer to a crush plant will reduce the price discount for growers here, Hoiseth said.

“Due to the soybean price discount being reduced, we do anticipate additional acres of beans being planted in northwest Minnesota,” Hoiseth said.

Epitome Energy is based in Red Wing, Minn. The plant in Crookston is the first biodiesel plant the company will have built, said Epitome owner Dennis Egan.

The city of Crookston will also be the recipient of new job creation in value-added agriculture, Hoiseth said. Other positives include increasing the overall economic activity in Crookston during construction and as the facility starts operation, Hoiseth said.

Local businesses such as hotels, restaurants and other services will all benefit, he said.

Ideal Site

Tom Slunecka, CEO of the Minnesota Soybean Research & Promotion Council (MSRPC), said that the Epitome Energy plant is the best way to bring value-added agriculture into northwestern Minnesota.

“For years, soybeans in that part of country have been some of the lowest priced in the nation,” Slunecka said. “The only way to change that is to do something to add value.”

MSRPC conducted a feasibility study to determine a suitable place for a new soybean processing plant and found that Crookston was best because of access to rail and the large volume of soybeans grown in the area.

Egan said Crookston also became the most attractive location for the new plant because of the utilities on the site. Egan considered the feasibility study when searching for a location.

Crookston had “brand new” electricity, sewer and water connections at the site, as well as nearby rail access.

Egan said that Crookston has been very welcoming.

“It’s been refreshing to come to community that’s excited to figure out path forward,” Egan said.

Now that Epitome Energy has selected a site, the Minnesota Department of Transportation awarded the project $450,000 at the beginning of January for new rail infrastructure that would serve the site, Egan said.

“We’ll be putting a spur onto our site so that we can haul meal, beans and biodiesel on and off the site,” Egan said.

Environmental Regulations

The entire project is estimated to cost $150 million, according to Egan. He hopes to be in “full construction mode” in the spring of 2021.

Once up and running, this facility will generate $322 million in economic activity, Egan said.

During the second or third quarter of this year, Epitome Energy will begin environmental reviews and apply for air permits.

To construct the facility, Epitome Energy needs to pass certain emissions criteria.

The state of Minnesota will also look at other plants in the area, like the American Crystal Sugar plant, and evaluate if the cumulative emissions will meet its standards.

“With the technology we’re deploying we have very little air issues,” Egan said. “We use less water than an ethanol plant, so we feel very confident that this geographic location is going to work for us.”

Minnesota’s renewable fuels mandate, put in place last year, states that across Minnesota in the winter, all diesel fuel has to be 5 percent renewable and in summer time it must be 20 percent. “Minnesota has always been a leader in biofuels,” Slunecka said. “By bringing on this plant, that will help us fulfill that mandate.”

Good-paying jobs

The plant will be financed with a public-private partnership, Egan said. He also hopes that a large portion of the plant will be grower-owned, whether that is establishing a co-op on site or working with local co-ops. “The last thing we want to do is come in and create a bunch of competition,” Egan said.

Investing in the plant will give locals an opportunity to invest in something they can touch, feel and see, Slunecka said.

“Rather than investing in the stock market, which you have no control over,” Slunecka said. “You can invest in something you can see in your own backyard.”

Egan also said that the goal of this project is to expand on local economic opportunities.

“We want to enhance soybean growers’ ability,” Egan said. “We see what’s going on in the markets, with China. Growers in northwest Minnesota have been told to store as many beans as they can and hope there is a market for them next year. By taking 21 bushels of those beans and processing them in Crookston to ship out oil, biodiesel and meal, we’ll stabilize the market for these local growers.”

The plant will include a 21-million-bushel soybean extraction facility that would crush soybeans, separating them into meal to be fed to animals and oil to move on to the biodiesel facility. A 30-million-gallon biodiesel facility and a specialty soybean mechanical extraction plant that includes a specialty oil-refining operation would also be on site.

“We think we’re going to fit nicely with the rural ag community and we’re going to provide opportunities for families to have livable wages,” Egan said. “These are good-paying jobs.”

Follow The Conversation