By AMBER RIGGIN, Kokomo Tribune staff writer
TIPTON — The latest in a string of ethanol production plants might come to Tipton, according to an announcement Monday by ASAlliances Biofuels LLC.
ASA officials said the company has begun negotiations to build a $125 million ethanol production facility adjacent to the Cargill grain elevator just outside the Tipton city limits.
The Dallas-based company and Cargill are considering an arrangement similar to that of three other ASA projects under construction in which Cargill has exclusive rights to provide the facility with corn and services such as energy and risk management, transportation logistics expertise and the marketing of the ethanol and dry distillers grain products.
Bill Keir, director of the Tipton County Economic Development Corp., said the county has been working closely with state officials, who granted approval of an incentive package last week.
The plant is expected to produce 100 million gallons of ethanol and 315,000 tons of DDG annually.
More than 35 million bushels of corn would be used annually and nearly 60 full-time jobs would be created, according to officials.
Construction could begin as early as fall, with the plant fully operational in 18 to 24 months.
Keir said ASA will likely pay local producers a premium price for corn and grain products to ensure large quantities on a consistent basis.
“That goes right to every farmers bottom line,” Keir said. “All of a sudden they’re getting 5 to 10 cents per bushel more than they were getting.”
ASA spokesman Mike Slaney said the Tipton site is attractive, based on a variety of factors, but it ultimately came down to the community’s workforce, corn production and a glowing recommendation from Cargill.
While ASA will deal exclusively with Cargill on all grain purchases, individual farmers are the core, Slaney said.
“Obviously, the local farmer is absolutely essential to the project,” he said.
Cargill officials noted a new ASA facility would benefit not only from Cargill’s local infrastructure and experience, but its broader expertise in the production and marketing of grain-based products.
Essentially, local corn would produce the ethanol, a 200-proof alcohol, and DDG, which is used as cattle feed, Slaney said.
The ethanol would be transported to blending facilities nationwide, he said.
Ethanol is sold nationwide as a high-octane fuel which delivers improved vehicle performance while reducing emissions and improving air quality, according to the Renewable Fuels Association, a national ethanol trade association. Ethanol reduces the nation’s trade imbalance, improves energy security by reducing fuel imports, creates jobs and provides value-added markets for American agriculture, it says.
Keir said the Tipton area also will benefit from an increase in trucking and rail transportation.