CGB, soy grower co-op to build North Dakota crushing plant

Reuters — U.S. grain handler CGB Enterprises and farmer co-operative Minnesota Soybean Processors are building a soy processing plant in North Dakota, the second new crushing facility announced in the state this year.

The plant — which will be built near Casselton, about 25 km west of Fargo — is expected to crush 42.5 million bushels of soybeans in the first year of operation, according to a statement posted on CGB’s website Tuesday.

The facility will also produce soymeal livestock feed and soybean oil to be used for food and renewable fuel. Construction is set to begin next spring, and is expected to be finished and begin operations in 2024, CGB said.

The new plant comes amid booming demand for vegetable oils for use in biofuels, most notably renewable diesel, a “drop-in fuel” which can be used interchangeably with fossil fuel-based diesel in engines. North American capacity to produce the fuel is projected to surge over the next three years, and demand for feedstocks is likely to be brisk.

Renewable diesel can be made from used restaurant grease and animal fat, but soybean oil is expected eventually to be the primary feedstock for the fuel.

The Casselton plant will be North Dakota’s second soy crushing facility announced this year. ADM said in May it will build a US$350 million crushing and refining complex at Spiritwood, about 100 km west of Casselton.

North Dakota, the No. 3 U.S. soybean state in terms of acreage this year, has traditionally been a major exporter of whole soybeans to China. The new crushing plants are expected to consume a significant share of the state’s production once they are completed.

“It is a unique opportunity to add value right here, provide a local market for North Dakota soybeans and boost economic growth in our state,” said North Dakota agriculture commissioner Doug Goehring.

The “ripple effect” of the new soy plant “will resonate throughout the agriculture community, bringing new market options to growers throughout the Red River Valley,” Cass County Commission chair Chad Peterson said in CGB’s release.

Louisiana-based CGB is today co-owned by Japanese firms Zen-Noh and Itochu. In Canada, Zen-Noh is a joint-venture partner in grain handler GrainsConnect, while Itochu’s holdings include a stake in hog producer and pork processor HyLife.

CGB also already operates a soy processing plant at Mount Vernon, Ind., about 250 km east of St. Louis; Minnesota Soybean Processors also runs a soy crushing and biodiesel refining plant at Brewster, Minn., about 250 km southwest of Minneapolis.

— Karl Plume reports on agriculture and ag commodities for Reuters from Chicago.