Construction of the Ringneck Energy ethanol plant at Onida will be completed on schedule, but the company may postpone startup until late February.
The plant was scheduled to begin grinding corn near the end of January, but Ringneck CEO Walt Wendland said the board of directors might push that back another month. When the board met in late November, it took into consideration two main factors: (1) The difficulty of starting up a plant in January; (2) Current extremely negative margins for ethanol production.
“We may be better off holding off instead of adding more gallons to an oversupplied market,” Wendland said. “We’re still optimistic about the ethanol industry. You always see lows for the year in the ethanol price during the winter when we don’t have the driving season.”
Wendland said there are so many negative things going on in agriculture, with tariffs, a trade war and challenges to the Renewable Fuel Standard, that delaying startup by a month seems like the right thing to do.
Ringneck Energy will still hire its entire staff after the first of the year to begin training.
Project manager Rob Schladetzky of Fagen Inc. said the plant has purchased corn and will have a good supply on hand in January. The plant will be ready to begin production as soon as the board gives the go-ahead.
“Once we start, we don’t want to stop,” Schladetzky said.
The facility will have an initial annual capacity of 80 million gallons and create demand for 25 million bushels of corn, with the potential to grind up to 35 million. It will produce about 212,500 tons of distillers grains and 12.5 million pounds of corn oil annually.
Ringneck will employ 40 people and receive corn from a 13-county region. Statistics show that 100 million bushels of corn and milo are harvested in the ethanol plant’s projected market area with only 10 million bushels of that consumed for livestock feed.
Investors include about 175 individuals and businesses in nine states, most in the Midwest Corn Belt.