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Sep 06, 2022

Nebraska Industrial Park Hunts for Soybean Crush Partner

Developer’s study shows that the area’s location and soybean production make this a low-risk opportunity.

North Platte Chamber & Development Corporation (the Chamber) is searching for a partner to build and operate a soybean crush plant as part of its industrial rail park in North Platte, NE. The 300-acre industrial park will be connected to the Union Pacific Railroad and is ready to move forward after three years of planning to bring Class 1 rail access to the area.

"We have worked three years on the planning process to develop an industrial rail park that had direct access to the Union Pacific Railroad mainline," explains Gary Person, president and CEO of North Platte Area Chamber & Development. "Due to the presence of Bailey Yard, the world’s largest rail classification yard in North Platte, it has been difficult over the past 75 years to gain access for industrial purposes on the UP mainline because of the traffic congestion in our region."

Soybeans become the prefect anchor point

The Chamber is determined to have a soybean crush plant as part of its industrial park, seeking advice from Nebraska soybean stakeholders, most notably the Nebraska Soybean Board (NSB).

"Our search then began for an industrial anchor project for the rail park that would be a good fit for our region and allow us to start installing the infrastructure," says Person. "With the growing high demand for soy oil in the green energy market and the ongoing demand for soymeal nationally and internationally, it become a natural target with the growing number of soybean acres in our region and being a distance from other soybean crush plants. The conversation became real when one of our local bankers started having conversations with local producers on what we could do to enhance their product markets."

With confirmation that a soybean crush facility would be a good fit in the planned industrial park, the Chamber has already conducted a significant feasibility study with RLA Consulting Group, an internationally experienced team of former executives with substantial soybean processing experience, to attract a partner. The feasibility study used a 3,000 metric ton/day processing plant using 36 million soybeans/year.

Using the feasibility study to sell a location

"In the pursuit of any type of economic development, you want to make sure it is a good fit for your economy and that it can work," continued Parson. "We now have solid evidence from a reputable research firm that validates this can be successful. We also know we are far enough distance away from other crush plants, as well as a potentially growing market for soybean production to the west of North Platte if a local market was available for their product."

The study found great opportunity and limited risk for locating a 3,000 metric ton per day soybean crushing plant in North Platte, Nebraska. The proposed site is in Western Nebraska and has access to sufficient soybean production there and from Northwestern Kansas to support the plant.”

The Chamber is now ready to receive proposals from parties interested in building the facility. Parson was asked if other locations should consider performing a feasibility study to sell their location to agribusinesses.

"It all depends on the circumstances. The studies are costly to conduct, but it certainly draws attention to the effort and has solid evidence of the information investors need to make wise decisions. It is what we chose to do, and local producers backed this effort. We also appreciated the input we received from the Soybean Board that validated our efforts to move forward."

A link to the feasibility study's executive study can be found here.

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Marketwatch: Dec, 06

US Corn Price Idx: ZCPAUS.CM

open: 6.5328
high: 6.55
low: 6.4408
close: 6.4673

US Soybean Price Idx: ZSPAUS.CM

open: 14.2059
high: 14.2809
low: 14.1255
close: 14.1516

US Hard Red Winter Wheat Price Idx: KEPAUS.CM

open: 8.3708
high: 8.3933
low: 8.0459
close: 8.0561

US Soft Red Winter Wheat Price Idx: ZWPAUS.CM

open: 6.9245
high: 6.947
low: 6.6307
close: 6.6779