Crushing news
It wasn't that long ago that Gov. Doyle was in town along with many other important people praising and celebrating the groundbreaking for the biodiesel plant on the east side.
Now the plant won't be built. As I first reported yesterday and more today, North Prairie Productions' board voted to end the project because of high commodity prices and other market conditions. Here's some numbers to explain: The operation was based on "historically conservative prices that projected soybean oil at about 24 cents per pound," chairman John Sheehy said. Soybean oil recently has been trading in the 64-cent-per-pound range.
Talk about a huge disappointment for those involved. This $42 million project seemed to gain support from all over, with the city and state backing it with funds. Farmers and other residents from all over Wisconsin invested in the project. In all the meetings and events I covered about the proposal, I don't recall anyone being completely negative or against the project.
About 900 shareholders will lose about half of their investment, and the minimum investment on the project was $10,000. The city said safeguards were put in the developer's agreement to protect against such news, and the North Prairie board chairman said he is committed to fulfilling NP's obligations to the city.
It could have been worse. People I talked to yesterday mentioned GM's plant closures and the similarities. But while everyone was gearing up for the boon to the county, it's clearly not as big of a loss as it could have been had the project continued and then ended later. The about 25 new people weren't working at the plant and then laid off.
I heard someone jokingly ask yesterday, "Will Evansville still be the soybean capital of Wisconsin?" as the signs leading into the city proclaim.
I'd have to say yes, because the good news is the soybean crush plant is still on track and could start construction next spring. That facility will be the state's first and will also be a boon to not just Evansville, but the entire county and region.
While some people say they're not surprised by the biodiesel plant's termination given construction was halted in November, what's your reaction to the news?
Jun 12, 2008 at 12:49 a.m.
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I should get a $5,000 tip from the relative I told not to invest in the plant, haha.
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With the US dollar in decline the past couple years, it is only logical that every world traded commodity is spiking in price (because they are all denominated off the dollar). The federal mandates on ethanol are also playing into to this, by creating an artificial demand for corn. Just proving once again why government intervention into free markets often does far more harm then good.
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