Zeeland Farm Services buys ethanol plant

Holland, MI —Zeeland Farm Services is getting into ethanol production.Nebraska Corn Processing, a ZFS subsidiary, recently announced purchase of an ethanol plant in Cambridge, Neb., from Mid America Agri Products/Horizon, LLC.

NCP aims to start production in the first quarter of 2010 and employ 30 people. The plant will convert 16 million bushels of corn into 44 million gallons of ethanol and 400,000 tons of an animal feed byproduct annually, ZFS officials said.

ZFS has worked in merchandising ethanol but not producing it, said Beth Westemeyer, a ZFS spokeswoman.

The agriculture and transportation company works largely in soybean products.

“This acquisition will allow NCP to gain a foothold in the energy industry and to further invest in agriculture,” said Cliff Meeuwsen, ZFS president. “Our goal is to develop viable business opportunities that will benefit NCP, agriculture and the communities in which we reside.”

The Cambridge plant was built in 2007 and was idle in most of 2009. The plant started production in early 2008. In 2009, about 20 employees were laid off. Mid-America filed for bankruptcy protection in 2009, and ZFS was able to buy the plant out of bankruptcy, said Andela Taylor, executive director of the Cambridge Economic Development Board.

Mid America was driven to bankruptcy by rising construction and corn prices, Taylor said.

But buying out of bankruptcy makes the initial investment low-cost for ZFS. And Taylor is confident the plant will be successful under its new owners.

“I think we’re in good hands,” she said.

The initial promise of ethanol flooded the market with investors and production plants around 2006, said Kurt Thelen, a professor of crop and soil sciences at Michigan State University.

Corn prices spiked in the summer of 2008, then dropped off in the fall. This caused problems for a lot of producers. But ethanol should be a smart investment for ZFS, Thelen said.

“It’s something that’s not going away,” he said. “The way the current energy policy is, there’s going to be in the near future a good market for ethanol.”

Cambridge has a population of about 1,000 and is about 260 miles west of Omaha.

source: hollandsentinel