Over the last 18 months, five biodiesel facilities across the U.S. have shut down, including the Duonix plant in Beatrice, Nebraska, which closed July 2.
There are no more biodiesel plants in Nebraska, according to the National Biodiesel Board centered in Jefferson City, Missouri.
Kaleb Little, director of communications for the National Biodiesel Board, lays the blame on politics. He said that policy issues, hardship waivers for small petroleum refineries and an expired biodiesel tax incentive have combined to hamstring the industry.
Along with Duonix, Renewable Energy Group closed its New Boston, Texas, plant. Kolmar Americas has idled it’s American Green Fuels plant in New Haven, Connecticut, and World Energy has suspended operations in its plants in Harrisburg, Pennsylvania, Natchez, Mississippi, and Rome, Georgia.
All were soybean feedstock plants.
The Beatrice facility specialized in processing corn oil into biodiesel. Soybeans are the primary feedstock for most other biodiesel producers. The parent company cited comparatively low soybean prices as the key factor for the plant being closed.
Duonix reportedly produced 50 million gallons of biodiesel per year. According to Bev Thessen of the National Biodiesel Board, this would require 375 million pounds of corn oil. This, in turn – according to the experts at the Corn Refiners Institute – would involve about 242 million bushels of corn.
The Beatrice plant purchased its corn oil from several local ethanol plants. According to Jim Stark, investor and media relations manager for Green Plains Inc., the closing of Duonix has not had an impact on the bottom line of the GPI ethanol plant located in York, Nebraska.
“We sold a few loads a year to [Duonix],” he said. “The plant closure has had no impact on our ability to sell corn oil. The majority of our corn oil is exported.”
As a company, Green Plains produces about 275 million pounds of corn oil annually and sell to a variety of customers in the U.S. and around the world, Stark said.
The Beatrice plant will remain idled indefinitely as its owners explore options, according to Michael Wilhelmi, manager of communications and community relations for Koch Companies Public Sector, LLC.
The Duonix plant, owned by Flint Hills Resources based out of Wichita, Kansas, is a subsidiary of Koch Industries.
Revamping the plant doesn’t seem to be an option Flint Hills is willing to entertain. Even though any biodiesel plant capable of processing distiller’s corn oil or yellow grease should have no trouble, technologically, processing virgin oils such as soybean oil into biodiesel, said Ron Kotrba, editor of Biodiesel Magazine.
“It’s usually the other way around,” he said. “A plant wishing to process DCO or grease when designed to process soybean oil is where modifications would need to be made.”
The complex could be placed on the market, and the owners are “exploring all options,” Wilhelmi said.
The 40 employees of the Beatrice plant were offered severance packages. No information about possible employment for these employees at the company’s other facilities was made available.
“Our Human Resources team has been working with each employee to help them with their next steps,” Wilhelmi said.
There is another Flint Hills Resources biofuels processing plant in Fairmont, Nebraska – about 70 miles northwest of Beatrice. The plant employs about 60 people.
Flint Hills also operates ethanol plants in six locations in Iowa - Arthur, Fairbank, Iowa Falls, Menlo, Shell Rock and Ames. Each of these plants use soybeans as their feedstock. It is unknown what the long-term viability of these plants is at this time.
Jon Burleson can be reached at email@example.com.