News > MidIowa News > Mid-Iowa Announces New Soy Processing Plant

Mid-Iowa Announces New Soy Processing Plant

Oct 13, 2020

New Soy Processing Plant to Break Ground in Butler County
Contact:  Mike Kinley, 515-210-7382, mkinley@midiowacoop.com
Note: High-resolution images of Mike Kinley, the SRSP logo, artists’ renderings of the SRSP plant and more are available upon request from Joel Benson, Mid-Iowa Cooperative (jbenson@midiowacoop.com, 641-485-4713)
 
SHELL ROCK, Iowa –Oct. 13, 2020—A new soybean crushing plant that will be built at the Butler Logistics Park northwest of Shell Rock, pending state and local approvals, will propel value-added agriculture forward in Iowa.
Mid-Iowa Cooperative, a farmer-owned cooperative based in east-central Iowa, and Mike Kinley, Mid-Iowa’s CEO, are leading the effort to create Shell Rock Soy Processing (SRSP), LLC. When operational in 2022, this plant will crush 38.5 million bushels of soybeans annually, or 110,000 bushels daily and will create 50 to 60 high-quality jobs.
“We’re positioned to extract all the value possible from locally-grown soybeans,” Kinley said. “This plant can supply both food and fuel needs, and it will bring Butler County and surrounding areas into the center of the global ag economy.”  
Mid-Iowa will own a portion of SRSP, which will cost approximately $270 million, and is currently seeking investors for the project. Mid-Iowa will also help originate soybeans for the plant, where groundbreaking is slated for late October 2020.
“Not only will SRSP create more than 50 high-quality jobs, but it allows our area to build on its strong agricultural heritage,” said Jeff Kolb, executive director of the Butler-Grundy Development Alliance. “This will help expand farm income potential, and it will diversify the economy, which can benefit everyone.”

SRSP, by the numbers
The facility will produce 847,000 tons of soybean meal per year (2,420 tons per day) for livestock feed markets, 462 million pounds of crude soybean oil per year (1.32 million pounds per day), and 77,000 tons of pelleted soybean hulls per year (220 tons per day). The soymeal and soy hulls (which contain highly digestible fiber) will be used in livestock feed rations.
“SRSP will add tremendous value to soybeans in the eastern part of Iowa,” said Mike Knobbe, an SRSP developing partner with Kinley. “This plant will also benefit the livestock sector by providing high-quality, 48 percent protein soymeal.”
The soybean oil from SRSP can be used for a variety of applications, including the human food industry. Approximately 25 percent of SRSP’s products will be used within Iowa, while 75 percent will be exported outside of Iowa.
SRSP will be able to unload trucks quickly, saving farmers and truckers a great deal of time when they deliver soybeans to the plant. “This soybean crush plant is a farmer’s dream,” said Jeff Reints, who farms in the Shell Rock area with his son, Clay. “Our closest plant is more than an hour away, and it’s notorious for having 3- to 4-hour waits. SRSP will increase demand for soybeans in our area. More profit potential means farmers will likely add more soybeans to their crop rotation.”
Assuming a 50-50 mix of beans by rail or truck, vehicle traffic to and from SRSP will include soybean deliveries from area farmers, as well soybean oil and meal transport. At peak capacity, approximately 150 trucks will access the plant per day. The plant’s close proximity to the Iowa Northern Railway will contribute to efficient traffic-flow patterns around the logistics park.
“Iowa Northern is honored to have a key role in connecting Iowa agricultural communities direct to the North American transportation network,” said Dan Sabin, president of Iowa Northern Railway Company, a Class III, shortline railroad based in Waterloo that serves industries throughout north-central and eastern Iowa. “We’re pleased to partner with Mid-Iowa Cooperative on this dynamic project and look forward to fulfilling our role in its future success.”
Rail cars will also be loaded out with crude soybean meal or oil. At peak capacity, the plant will load/unload approximately 35 railcars per day.
The plant will be built by Minnesota-based Fagen, Inc., the engineering, procurement and construction (EPC) design builder and development partner for SRSP. “It’s a pleasure to work with the Fagen team,” Kinley said. “They are the premiere design-build partner in value-added ag processing.”
This extensive experience will enhance the opportunities generated through the Butler Logistics Park.
“This plant fits so well with this area, since the Flint Hills Resources ethanol plant and TrinityRail Maintenance are already here,” Reints said. “Anytime you can add jobs that keep our rural communities and schools strong, it’s a win-win. We’re really looking forward to the ways this plant will grow the economic base in our rural area for generations to come.”

Plant promotes partnerships, responsible growth
Other farmers agree. “SRSP offers a big opportunity to add value to local soybeans and boost the economy,” said Bob Hogle, a Beaman-area farmer who serves as Mid-Iowa Cooperative’s board president. “It will also help farmers save a lot of time. When you’ve waited in line at a soy processor for four, five or six hours to dump grain, it’s such a waste. MIC knows there has to be a better way. SRSP is a great fit for our area, especially since we’ve unified with East Central Iowa Co-op.”
The right leadership is key to this project.
“Mike Kinley, MIC’s CEO, is a next-generation co-op leader who brings a wealth of experience with projects like this,” Hogle said. “He has the right connections in the industry and management skills that are second-to-none.”
A project of this scale requires a team effort. “Creating SRSP has taken a lot of stakeholders, including local farmers, ag cooperatives, economic development leaders, county zoning officials, the Butler County supervisors and many others,” Knobbe said. “It’s rewarding to see so many people working together to make this plant a reality.”
SRSP will benefit the region for decades to come. “Providing soybean growers with a new option through SRSP isn’t just for today’s farmers,” Hogle added. “It will benefit the next generation, too.”
For more information, log onto www.midiowacooperative.com.
 
About Mid-Iowa Cooperative: We know trust is earned, never given. Since the merger of area farmer-owned cooperatives in 1996 that created Mid-Iowa Cooperative, we have experienced record growth, putting us into the top 10% of all Iowa cooperatives in terms of sales and profitability. For more than 75 years, generations of farmers have counted on Mid-Iowa Cooperative, which is rooted in Iowa agriculture. Our diverse client portfolio reaches across the state to serve more than 1,400 members. We are also the largest direct-ship farm-to-market grain procurement company in the Midwest.  As a farmer-owned cooperative, we offer products and services in grain management, marketing, insurance and feed.
 

Questions & Answers About Shell Rock Soy Processing

 

What’s this new project I’m hearing about by Shell Rock?

Shell Rock Soy Processing (SRSP), LLC, is a new soybean-crushing plant that will be built at the Butler Logistics Park northwest of Shell Rock, pending state and local approvals. It’s a game changer that will propel value-added agriculture forward in Iowa.

Mid-Iowa Cooperative is the founder of SRSP, which is a positioned to extract all the value possible from locally-grown soybeans. When operational in 2022, this plant will crush 38.5 million bushels of soybeans annually, or 110,000 bushels daily. This plant will supply both food and fuel needs. SRSP will be able to unload trucks quickly, saving farmers and truckers a great deal of time when they deliver soybeans to the plant.

As it creates value-added marketing opportunities closer to home, SRSP will bring this region into the center of the global ag economy, with the potential to tap into the export markets.

Why are you building this plant in Butler County?  
We were able to buy a sizeable area of land near the Butler Logistics Park, which offers convenient access to local highways and the Iowa Northern Railway. The shortline Iowa Northern Railway helps connect Iowa agricultural communities direct to the North American transportation network. Other businesses already located in the Butler Logistics Park include the Flint Hills Resources ethanol plant and TrinityRail Maintenance.

While this region known for world-class agriculture, there’s a huge weakness in the current system. The average age of a soybean-crushing plant in the region today is 42 years. The service farmers receive from many of these antiquated plants is unacceptable, with waits as long as 3 to 6 hours. When you add up all the time and money wasted due to these antiquated processing plants, it totals roughly $6.5 million.

Mid-Iowa knows there has to be a better way. SRSP is a great fit for this area and will create positive economic opportunities for decades to come.

Will there be a lot of odor with this plant?
No. SRSP is designed to foster responsible economic development, and we want to be a good neighbor. The most noticeable odor will be the smell from the toasting of the soybean meal, which is similar to toasting nuts or seeds on a stove. 

Will this plant be noisy?
SRSP will not contribute to excessive noise pollution. It will have an ambient noise level consistent with other existing industrial operations within a mile of the plant.

Will the lights of this plant become a nuisance?
SRSP will have an ambient lighting level consistent with other existing industrial operations within a mile of the plant and will not be intrusive to the surrounding area.

Will this plant use a lot of water?
SRSP will use water efficiently. Potable water consumption for the plant is estimated at 3,600 gallons per day. Process water would equate to about 400,000 gallons per day. The City of Waverly, in comparison, pumps 975,000 gallons of water daily.

Will this plant be a safe facility?
Yes. SRSP will incorporate modern safety systems and protocols to benefit the employees and people who live in the area, while protecting the environment. The plant will use a solvent called hexane to extract oil from the soybeans. Hexane is used (with U.S. Food and Drug Administration approval) in many soybean crushing plants. Hexane is used only in the initial steps of soy processing, and virtually all of it is eliminated by the time the soy ingredients are incorporated into food and feed products.

How does this plant impact the farm economy?
SRSP allows our area to build on its strong agricultural heritage by adding more value locally to soybeans, which will be processed into soymeal and soy oil at the plant. The soymeal, for example, will benefit livestock producers. SRSP’s high-quality, 48 percent protein soymeal can be combined with soy hulls (which contain highly digestible fiber) to make pelleted cattle feed.

Increasing demand for soybeans in our area will help expand farm income potential, plus it will diversify the economy. This is value-added agriculture at its best. The soybean oil from SRSP, for example, can be used for a variety of applications, including the human food industry. Approximately 25 percent of SRSP’s products will be used within Iowa, while 75 percent will be exported outside of Iowa.

SRSP will bring our region into the center of the global ag economy, with the potential to tap into export markets.

Is this something that will just benefit farmers?
No, this plant will create many opportunities that will benefit a wide range of people in our local communities. The plant will create more than 50 to 60 high-quality jobs, which will help attract people to our area.

SRSP and Mid-Iowa will work with area schools to support FFA programs and technical education programs that help students build their skills and encourage them to pursue job opportunities at SRSP, where they can grow their careers close to home.

Anytime you can create economic development opportunities that keep our rural communities and schools strong, it’s a win-win. SRSP will also enhance tax revenues and grow the economic base in this region for generations to come.

What’s the timeline for this project?
Groundbreaking for SRSP is slated for late October 2020. SRSP will be able to accept beans by the summer of 2022 and will become operational by the fall of 2022.

Will farmers and others be able to invest in SRSP, like they could when ethanol plants were being built in Iowa?

Farmers will be able to invest in SRSP. However, the project will cost about three times more than the what was required to build ethanol plants 20 years ago, meaning the minimum investment in SRSP will be much higher. More details will be available when SRSP launches round two of its funding process, so stay tuned.

Who are the primary investors in SRSP?
Mid-Iowa Cooperative is the primary investor. We are not at liberty to discuss the names of other investors until financial closing on SRSP is complete.

What will be Mid-Iowa’s percentage of ownership in SRSP?
This is to be determined, depending on subsequent rounds of funding that must be completed to build SRSP.

Where can I find more SRSP updates?
Visit Mid-Iowa Cooperative’s website at www.midiowacoop.com.



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