Corn flowing into ethanol plants as harvest struggles continue
SPIRITWOOD, N.D. — The roads leading to the Dakota Spirit Ag Energy ethanol plant are lined with uncombined corn. In some places, stalks are in standing water about knee-high.
David Freeman, merchandiser at Dakota Spirit Ag Energy, owned by Midwest Ag Energy, says conditions in the 30-40 mile radius from which the plant typically buys corn have been as wet as anyone has seen in at least a decade. Stutsman County, where the plant is located, in October declared an emergency because of flooding. High water is common throughout the region.
“It’s been a pretty big struggle,” Freeman says about finding corn for the plant.
Farther west at Midwest Ag Energy’s Blue Flint Ethanol in Underwood, N.D., merchandiser Josh Mardikian says the challenge farmers are facing in getting corn out of the field filters to the ethanol plants.
“It’s been just as challenging for us to source corn as it has been for our producers to get it combined,” he says. “We’re with them all the way. When they struggle, we struggle.”
The story is similar in other parts of the region. South Dakota led the nation in prevented planting acres, so there’s less corn to begin with, says Tom Hitchcock, CEO of Redfield Energy in Redfield, S.D. He estimates only 10% of the corn in his area has been combined.
“It’s been a tough year since last Christmas,” he says.
By this time most years, Redfield Energy has full bins, plus 1 million to 2.5 million bushels of corn in bunkers. This year, only about a fourth of the bins are filled, Hitchcock says.
Troy Knecht, a corn farmer in Houghton, S.D., and past president of South Dakota Corn, says he’s combined about 15-20% of his corn. What has been combined has been wetter than he’d like, at 24-26% moisture, so he’s trying to get it dried.
The weather hasn’t been favorable, but the bigger problem has been the ground conditions leading to combines getting stuck, he says. And even getting the crop into a truck isn’t the end of the struggle.
“There’s a lot of roads that have water over them. Prairie roads are slick, are muddy, everything, not just the fields,” Freeman says.
The corn that has been combined hasn’t been in ideal condition for the plants. Much of the corn in the region was immature when it froze, leaving it abnormally wet at this point in the season. The plants can handle 25% moisture corn. Freeman says moisture in excess of 30% hasn’t been unusual in his area.
Knecht sells corn to Glacial Lakes Energy in Mina, S.D., and POET Biorefining in Groton, S.D. The plants have kept basis low to try to lure farmers to sell rather than store their corn. Hitchcock says plants are sensitive to the needs of the farmers but still can only offer so much to make sure they’re not losing money.
“We have to watch our margins, too,” he says.
Hitchcock said he believes corn will continue to trickle in to keep plants going.
“I believe harvest is going to be strung out for the next 45 days,” he says.
Freeman does worry that the old crop corn they’ve been relying on in Spiritwood is running out.
“We’re going to need to start seeing some new crop come, otherwise, yeah, it’s going to be really tough finding old crop,” he says.
Mardikian and Freeman stress the importance of growers communicating with buyers if they don’t think they’ll be able to fulfill their contracts on time.
“This year, the biggest thing is communication. We understand that there’s a lot of stress out there with everything this year. And we don’t want to make it any harder for guys. We want to just work with them and, at the end of the day, just come up with a solution,” Freeman says. “We’re not here to penalize guys or anything like that. We just want to work everything out and do what we can to get the corn in.”
“It’s stressful enough, and we’re certainly not going to add to it,” Mardikian agrees.