The Crush Rush: Two High-Ticket Soybean Crushing Facilities Coming to Nebraska

By Lynda Kiernan-Stone, Global AgInvesting Media

Recently, Canada has seen its own version of a “crush rush”. Over the past year there’s been a “gold rush” underway in Saskatchewan, however, in this case, the term “gold’ refers to canola. In little more than a month’s time during the spring of 2021, three major companies announced plans to build massive canola crushing plants in the province through projects that carry a combined value exceeding $1 billion.

More recently, in January of this year, Saskatchewan-based oil company Federated Co-operatives Limited (FCL) made multiple announcements, including the signing of a memorandum of understanding to form a joint venture with AGT Foods & Ingredients, a leader in plant-based proteins and processing of pulses, grains, staple foods, and ingredients, to construct another $360 million canola crushing plant.

This facility builds upon another recent announcement by FLC that it intends to build a renewable diesel plant in the Regina area, and will provide approximately 50 percent of the feedstock required for production of 15,000 barrels-per-day. The remaining 50 percent of the feedstock will be contracted from other canola crush facilities.

This rush-to-crush has been gaining speed in the U.S. too. In May of last year Archer Daniels Midland (ADM) announced it was investing $350 million to build the first dedicated soybean crushing plant and refinery in North Dakota.

Strategically located in Spiritwood, North Dakota – a major soybean producing region – this crushing and refining complex will include state-of-the-art automation technology supporting a processing capacity of 15,000 bushels of soybeans per day.

Continuing the trend, two major announcements were released by two different companies within a week’s time, outlining plans to construct large-scale soybean crushing plants in Nebraska.

Bowdish Company announced it intends to invest $375 million to build a state-of-the-art soybean crushing plant near Norfolk, Nebraska. Construction at the 480-acre site is slated to begin this spring, and once completed in 2024, the facility will have the capacity to crush 38.5 million bushels of soybeans per year, or 110,000 bushels per day, and will be served by the Nebraska Central Railroad Company and the Union Pacific Railroad.

“This will be the first modern soybean processing facility to begin operations in Nebraska,” said Nick Bowdish, president and CEO, N Bowdish Company - a developer of value-added projects for the ag sector.

The entity Norfolk Crush will own the facility, and has selected Fagen Inc. to engineer the project and serve as the producerment and construction contractor for the plant.

“The Norfolk area is a great location for a soybean crush facility, which will make a lasting, positive impact on the region,” said Fagen Inc.

Production at the site will result in 847,000 tons of soybean meal per year destined for livestock feed markets, and 450 million pounds of crude soybean oil and 77,000 tons of pelleted soybean hulls per year to be used in livestock feed rations. The soybean oil, however, will also have the potential to be used for the rapidly expanding renewable diesel industry.

The difference that the addition of this plant will make on the ground is significant, according to local farmer Craig Ebberson, who said, “A modern crush plant is a farmer’s dream. Our closest plant is an hour away, and it’s notorious for having 3-4 hour waits. Norfolk Crush will increase demand for soybeans in our area, adding more profit potential.”

The opening of this plant also will have positive outcomes in a broader sense for the state, as well, noted Nebraska governor, Pete Ricketts. “The driving force behind our success is the hard work of innovators and leaders like Nick,” said Ricketts. “Under his leadership, value-added projects have enhanced our agriculture sector by better enabling our farmers, ranchers, and feeders to do what they do best: feed and fuel the world. Norfolk Crush will be a great addition to support our soybean production in the state.”

Meanwhile, Just 70 Miles Away…

Within the same week, Ag Processing Inc. (AGP) made its own announcement outlining its plans to build an advanced soybean processing plant near David City, Nebraska with an annual capacity to crush more than 50 million bushels of soybeans.

Owned by local and regional farmer and producer cooperatives, and with a headquarters in Omaha, Nebraska, Ag Processing is a leading agribusiness primarily as a soybean processor/refiner, producing and marketing soybean meal, refined soybean oil, and biodiesel.

“The soybean processing industry is experiencing tremendous growth and we believe a facility in East Central Nebraska is strategically located to serve our cooperative members and their farmer-owners,” noted Lowell Wilson, chairman, AGP. Maintaining a strong cooperative system is vital to agricultural producers and our rural communities.”

AGP not only expects this facility will generate solid returns for its local members, but also will boost the cooperative’s export business, according to Chris Schaffer, CEO, AGP, who explained, “The David City location will also improve the Company’s ability to market soybean meal to the Pacific Rim through AGP’s export terminal in Aberdeen, Washington. AGP is currently considering investments that will significantly increase our export capabilities to meet the expected growth in domestic protein supply.”

The final timeline and construction decisions will be finalized based on the outcome of negotiations with state and local officials regarding economic development incentives, required infrastructure improvements, utility services, and regulatory issues. However, AGP expects operations to begin in 2025.

“The availability and quality of soybeans in the area and access to major rail lines make David City an excellent location for the plant,” said Mark Sandeen, chief marketing officer, AGP. “When completed, the David City facility will provide a significant market opportunity for soybean growers in the region through AGP’s cooperative owners. The project is expected to create over 60 well-paying jobs. AGP continues to invest in areas that enhance our integrated business platform and we are confident the David City facility will strengthen our market position and ability to compete well into the future.”

Lynda Kiernan-Stone is editor with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and Agtech Intel News, as well as HighQuest Group's Oilseed & Grain News. She can be reached at lkiernan-stone@globalaginvesting.com.