The 11 board members of Soy Energy Biodiesel are absolutely delighted with how everything is coming together to make their hard work pay off. The actual building of the plant should begin within two weeks. All of the funding for this flexible front-end plant has been raised with 90 percent of those funds coming from Northwest Iowa.
Soybean oil is at an all-time high price. Commodity market prices fluctuate and Iowans understand that fact. Soy energy has planned for high prices by making their plant a flexible plant. The group never planned to use only soybean oil to make biodiesel. That simply would be too expensive.
In fact, they only planned for only using soybean oil for one-third of their product. The other two-thirds will come from fat and vegetable oils.
"Even though soybean is expensive right now, there is an abundant inventory of soybean oil. There is no shortage of it. From our figures, with high markets, we are able to figure in a good profitability for our investors," said Bob Engel, project manager.
Another factor making this proposed plant profitable is the use of biomass pellets.
"We will save 60 percent off our energy bill by using these pellets rather than go with natural gas. That item alone brings back 2 percent more for our investors," explained Engle. "The third factor is that in the third or fourth year, we may go ahead and put in a mechanical crusher. We will get into buying soybeans then and crush them for the oil."
The building plans are being fine-tuned now. Bratney Co. of Des Moines will build the plant.
"The other important item that will make this plant a success is that we were able to acquire technology for running the plant from Cimbria Sket & Westhaila of Germany. Germany has been using biodiesel for 20 years and is far ahead of the U.S. in use of the biodiesel in vehicles. German technology is the benchmark for producing premium diesel. Soy energy will produce 30 million gallons a year."
"That equates to 10 million bushes of soybeans a year for one-third of our production. That basically would take all of the soybeans produced in Cherokee County. Otherwise, if we would only use soybeans to make soy diesel, it would take all the soybeans from three counties. Another reason for having a flexible front end plant," said Engel.
The first meeting about a biodiesel plant was held in Dec. 2002 and periodically for some time They have met steadily for the last 18 months, weekly for a number of hours. They began with a feasibility study that 10 people carefully studied. The group outlined the essential steps and followed the list carefully.
"What will make this plant successful is building it on investors making sure it will be good for each one of them. We keep reminding ourselves with the question, will this be good for the investor?" said Darrel Downs.
They sought advice from professionals for their knowledge. They turned over every stone.
"When we learned that ADM (Archer Midland Daniels) used this same German technology, we knew we were on track. ADM's plant is the largest biodiesel plant in the country." said Engel
Serving on the board from around the area are: Chuck Sand, Marcus; Ron Wetherell, Cleghorn; Daryl Haack, Primghar; Dallas Thompson, Kingsley; Doug Lansink, Arthur; Abe Langel, Le Mars; Chuck Getting, Sanborn; Carol Reuter, Marcus; Steve Leavitt, Ankeny; Darrell Downs, Marcus and Bob Engel, Orange City.
A groundbreaking ceremony is being planned for around the first part of July. The road has been altered for safety of the proposed plant; they will have rail access; the main terminal to ship the biodiesel is in Argo, Ill. (they came to soy energy requesting their product). The terminal is straight east.
Engel summed it up, "It gives the competitive edge. We have been complimented for raising the money primarily in the area by Rep. Steve King and others. Bankers have come to us. They like what they see and hear. This plant has come about through a grass root effort and that makes it a shining example."