$11.2M grain facility being built
A major player is entering the grain-handling business.
Concord Grain Company, owned by Todd Ochsner, began construction on its new shuttle loading facility on April 1 and plans to open for business Sept. 15.
The $11.2 million grain elevator with a 2-mile railroad loop track will be located about 6 miles west of Aberdeen on the north side of U.S. Highway 12 near 379th Ave..
Nearly all of the excavating work was completed last year, which is one of the reasons construction is expected to proceed rapidly this year, said Myron Jepson, general manager.
The elevator site is ready for concrete to be poured for some of the pits, service road beds are complete and the railroad track bed has been built up, he said. Construction, however, was slowed last week by the snow.
The facility will be able to load 110-car unit trains. The rail cars will travel on the BNSF line.
Ochsner is a Brown County farmer with operations in eight counties.
While privately owned shuttle facilities are rare, they are not without precedent, Jepson said. In South Dakota, there is one in Harrold, and there are a couple in North Dakota, he said.
Concord Grain will have 2.55 million bushels of storage capacity. There will be three, 730,000-bushel (105-foot-diameter) steel bins and one, 360,000-bushel steel bin. The facility is equipped with three, 20,000-bushel-per-hour dump pits, as well as, a 7,000-bushel-per-hour dryer.
“We think there is a need for what we have to offer,” Jepson said.
Concord Grain will meet with farmers in the area to explain the benefits of the facility, Jepson said.
While there is a lot of competition in the area with several Wheat Growers and North Central Farmers Elevator facilities and three ethanol plants within a 45-mile radius of Aberdeen, there is room for another company, he said.
“What we are seeing is a continued growth in the number of acres of corn and soybeans planted,” he said. “There are more (Conservation Reserve Program) acres going into production every year, especially in McPherson County. You couple that with a three percent growth in yield every year because of better seed genetics, and what you get is a need for more storage and drying capacity.”
Jepson said cooperatives, such as Wheat Growers and North Central, are doing a good job and have expanded their capacity with upgrades and new facilities. However, the increase in the amount of grain produced in this region has created opportunities, he said.
It doesn’t matter if it is a private elevator or a cooperative, there is a need for more storage and shipping capabilities, he said.
Concord Grain will be highly automated and efficient, Jepson said. The facility will employ five people year-round, but could be operated by a single person in nonharvest times, he said.
Shuttle facilities with loop tracks are preferred by railroads because of the quick turnaround times for the rail cars and locomotives, he said.
The facility will ship most of its grain to the Pacific Northwest for export to Asia. In an average year, the company expects to export 75 percent of its grain and sell about 25 percent locally to livestock producers and ethanol plants.
“That ratio could change depending on the year,” Jepson said.
The facility will also have the capacity to receive full train cars and unload them.
Ochsner received a $1.44 million loan from the State Railroad Authority in April 2012 which will help fund the rail construction. The funds are available to small rail lines and for construction of loop tracks.
The Aberdeen Brown County Rail Authority agreed to serve as the pass-through organization for the loan money and is ultimately responsible for assuring the loan repayment. The board has taxing authority and could levy a tax in the district to repay the loan in case of default.
Jepson said Concord Grain would welcome the right business partners who might want to use the facility’s rail capabilities. In the future, there might be multiple enterprises at the elevator such as agronomy products and services, he said.
Ochsner did most of the excavation of the site himself.
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48th Year No. 2 Friday, April 19, 2013
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