Aventine ethanol plant at Aurora back online

Aventine Renewable Energy Inc. is distilling corn again at the Nebraska Energy LLC ethanol plant a mile west of Aurora.

But it's not corn from the Aurora Cooperative, the local agribusiness giant that is in legal conflict with Aventine and has been for a couple of years.

Both Aventine's 20-year-old Nebraska Energy plant, with an annual production capacity of 45 million gallons, and its adjacent 110-million-gallon Aurora West Plant, were closed in 2012 after corn became too expensive at $8 a bushel.

After finishing construction, the Aurora West plant reopened at the end of May this year, using beet sugar as feedstock, and the Nebraska Energy plant restarted in mid-June, on corn, now down to less than $3.60 a bushel.

"We are finishing our sugar campaign at Aurora West, and plan to be done at the end of September," said Mark Beemer, chief executive of Aventine. The bigger plant will then resume using corn as feedstock, he said.

Twenty-four people are working full time on ethanol production at Nebraska Energy, Beemer said, and the company has spent about $700,000 for new platform scales, a grain probe, new roads and a grain-grading lab. The company now has about 45 to 50 people working at Aurora West, for an annual payroll at both plants of $4.6 million, according to Beemer.

He said the Nebraska Energy plant will be hitting its maximum production rate on corn by mid-August.

Since the restart, the plant has processed more than 600,000 bushels of corn, he said, and has shipped 1.2 million gallons of ethanol to fuel blenders and more than 10 million pounds of distillers grain to cattle feedlots.

At the Aurora West plant, the company is using sugar because it can. It's even simpler to make ethanol from sugar than it is from corn, and the federal government sells surplus subsidized sugar to ethanol producers, a policy corn farmers don't particularly like.

Aventine's operations at Aurora have been complicated by the company's U.S. District Court conflict with the Aurora Cooperative, which sued Aventine over their deal to build the Aurora West plant on land the co-op owned, over rail access and other agreements, including the supply of corn to make ethanol.

Aventine, based in Pekin, Illinois, filed for bankruptcy five years ago, and that delayed the Aurora West plant's construction, causing the original conflict.

The co-op had an agreement to supply the plant with corn. Both sides contend the other breached that agreement. Beemer said Monday they are no closer to settling their differences. So the corn now being used as feedstock, he said, is coming from other neighboring co-ops.

After starting construction of the Aurora West plant in 2008, Aventine never achieved steady production. The recession, the company's bankruptcy, the price of corn and the fight with Aurora Co-op intervened.

The co-op represents thousands of farmers who would supply corn to the two plants under normal circumstances.

George Hohwieler, CEO of the Aurora Co-op, said in June the co-op wants the plants operating to offer markets for its producers, that it would continue to seek opportunities to settle with Aventine, but would also continue to hold Aventine accountable to the contracts. The co-op released the same statement Monday.

In the fiscal year that ended Aug. 31, Aurora Co-op reported sales and related income of $1.1 billion. It's the second largest co-op domiciled in Nebraska and the 52nd largest in the country, according to a measurement by National Cooperative Bank.

Source: Lincoln Journal-Star

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