Posted: Thursday, July 28, 2011 11:00 AM
New manager promises to rebuild growers' confidence
ODESSA, Wash. -- A canola crushing and biodiesel refinery is back in operation with new management at the helm.
Inland Empire Oilseeds LLC, which had closed due to lack of capital in July 2010, reopened in June, new general manager Joel Edmonds said. The company plans to go to full staff in order to resume full capacity, he said.
Edmonds was hired in April.
The company wants to encourage farmers to add oilseed crops to their rotations. Edmonds thinks farmers were excited about growing canola early on, but became skittish when the plant ceased production.
"I want (farmers) to feel comfortable and safe planting their crops this fall, knowing there's a home for it this spring," he said. "Our focus right now is re-establishing our reliability in the marketplace."
Canola is a rotation crop. Benefits include a reduction of weeds and insects that arise in wheat-on-wheat rotations and a yield increase in wheat following canola.
Keith Bailey, CEO of AgVentures Northwest, one of the major investors in Inland Empire Oilseeds and its canola supplier, said the company's capacity is larger than the amount of the crop grown in the area.
Current plant capacity is approximately 25,000 tons of canola, Bailey said. It now comes from Oregon, Idaho, Washington and Montana.
"We've got new investment money that's in the development stage right now," Bailey said. "Our long-term prospects are very good. The only thing holding it back from being in full production is the fact they don't have enough trained people to operate it."
Marketing and logistics manager Pearson Burke said there are still political debates in Washington, D.C., over the federal blender credit, primarily for ethanol, but the Environmental Protection Agency is not expected to reduce its requirements for biodiesel use.
Odessa farmer Jeff Schibel said price is the biggest factor in the interest -- or lack thereof -- of growing canola. He's been raising the crop on 125 acres for 12 years, but expects interest will remain the same unless wheat prices drop and canola prices remain high.
Washington State University professor Bill Pan, director of the state Biofuel Cropping Systems Program, expects the plant will have to go through at least one production cycle before growers feel comfortable enough to grow canola for it.
"As word gets out and they see there's a local demand here and a place to take their grain, that will start stimulating more interest," he said.
He estimated about 15,000 to 20,000 acres of canola are planted in Washington. In the U.S., 1.12 million acres were planted this year, according to the National Agricultural Statistics Service, down from 1.45 million acres in 2010.
"It seems the moon and the stars are starting to align," Pan said, pointing to prices, government support and demand. "We just need to encourage more growers to give it a try on small acreages first, and then work from there."
The Inland Empire event was days after Canadian company Legumex Walker Inc. announced it would open a Pacific Coast Canola facility in Warden, Wash. That plant is expected to be operational in 2013.
Edmonds expects the two facilities will complement one another.
"I think it helps us," he said. "The more press and more noise they can make about it, and the more they encourage people to grow canola, the more farmers feel there's a robust market for it."
October 2008: Inland Empire Oilseeds unveils its new facilities in Odessa, Wash.
November 2008: Plant begins producing biodiesel.
September 2009: Company holds grand opening for facility, begins crushing canola.
January 2010: U.S. House of Representatives approves renewal of tax credit for biodiesel blenders, but U.S. Senate allows it to lapse. Industry hopes credit will be reinstated retroactively.
June 2010: Senate considers bill to extend tax credit, retroactively renewing from time of lapsing. Former Inland Empire Oilseeds manager Steve Starr tells Capital Press there's been no effect on company.
July 2010: Production shuts down; 21 employees laid off. Starr says the facility will operate intermittently.
December 2010: Blender credit approved, retroactively, for 2010.
April 2011: New management comes aboard.
June 2011: Company resumes production.
July 2011: Company holds open house for industry and community members.