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Published December 27, 2011, 06:14 PM

Gold-striped: New ag tile maker to open in Red River Valley

Farmers who were left waiting for field drainage tile in 2011 may be getting a wish fulfilled for the new year — a second tile manufacturer in the Red River Valley.

By: Mikkel Pates, Agweek

MOORHEAD, Minn. — Farmers who were left waiting for field drainage tile in 2011 may be getting a wish fulfilled for the new year — a second tile manufacturer in the Red River Valley.

Prinsco Inc., one of the bigger players in the ag tile business, is making a big manufacturing move into the area in 2012.

By mid-February, the Willmar, Minn., area company will have set up a temporary manufacturing plant with two production lines in Moorhead, Minn. At the same time, the company is starting dirt work a larger, permanent plant in north Fargo, N.D., Moorhead’s sister city, and will start construction in the spring for production by the end of the year.

All of this is part of a frenzied, historic expansion of sub-surface field drainage in the region.

Prinsco is the second tile manufacturer to initiate production in the Red River Valley in the past year. Advanced Drainage Systems started operations at its Buxton, N.D., plant in March, and is in the process of expanding it. Prinsco, which specializes in the agricultural market, says that (other than Buxton) its company operates three of the farthest-north manufacturing plants serving Northern farmers.

Tiling transitions

Prinsco’s history is one marked by technological transition and entrepreneurship.

The company was Duininck (pronounced DUN-ik) family that had been in the road construction business since 1926 in Prinsburg, Minn., a town of 450 people about 20 miles southwest of Willmar, Minn. In the 1970s, the family noticed that field tile market for sub-surface agricultural drainage was taking off in other Midwest states, so the second-generation Duinincks seized a new market.

The Duinincks started Prinsco as a wholly-owned subsidiary in 1975, making construction and field drainage tile.

“The main reason was opportunity,” says James “Jamie” Duininck, vice president of sales. Other parts of the Midwest — Iowa, Indiana and Illinois — were getting active in sub-surface farm drainage.

Prinsco’s first tile products were made of concrete. There were many competitors in the market — mostly mom-and-pop companies, some of which had been in the business since the late 1800s.

“It used to be that every little community had a concrete tile plant,” says Kent Rodelius, Prinsco’s manager of agricultural sales.

“Those have gradually disappeared. There’s only one that still operates in Minnesota. Prinsco has always worked to respond to what the customers are looking for.”

The Duinincks started making corrugated plastic tile in 1981 and discontinued the concrete in 1986. That also was the year the company started making larger-diameter plastic pipe and dual-wall pipe for mains. Some of the other major players in the agricultural side of the tile business had been around since the late 1800s and early 1900s.

“Some made the switch from clay or concrete; some did not,” Duininck says.

In 2000, Prinsco purchased a small company that was manufacturing plastic pipe in Illinois. In 2004, Prinsco purchased a company in Iowa that had three locations — Hawkeye and Jesup, Iowa, and one plant in Fairfax, Minn. In 2008, Prinsco expanded into the Fresno area of California.

In 2010, Prinsco approached peer companies and formed “National Drainage Alliance,” an entity that provides a “unified team with a seamless business structure.” The national coverage appeals to companies and co-ops with centrally organized operations but multiple locations throughout the nation.

(Besides tile, the Duininck businesses include outdoor resorts, wild rice and golf course construction. Duininck is a partner in the Duininck Co.’s parent company. There are 14 family members involved in the business, spread across two generations.)

In 2011, Prinsco built a plant in Beresford, S.D., with three production lines to meet the growing market in North Dakota and South Dakota.

“Fargo-Moorhead was a finalist at that time, but we chose to expand (first) in South Dakota, because we had a little more established business, as far as total dollar volume.” The new North Dakota facility will join sister plants in Minnesota, South Dakota, Iowa, Illinois, Missouri and California.

Steep growth curve

Prinsco, whose products have been marketed as “the pipe with the golden stripe,” had been studying the Red River Valley and regional marketing since the late 1990s as a potential manufacturing site. They’ve been shipping piping into the region in smaller quantities for decades, but mostly in non-ag purposes until 2002.

Company officials perceived that some farmers here were very advanced in precision farming, but that most farmers here had “missed one step,” and that’s “water table management through sub-surface drainage,” Rodelius says.

Government agencies, including the Natural Resources Conservation Service, have concluded that to take full advantage of precision-farming — getting site-specific control of fertilizer and chemical data and applications — farmers first must “manage the water tables,” Rodelius says

Rodelius adds that even though tiling had become a staple of agricultural production farther south, the banking and real estate communities in the region needed some help to accept the concept.

The Prinsco folks tried to convince others to initiate a demonstration program, but eventually decided to go ahead on their own. In 2000, the company purchased and tiled a piece of farmland in the Johnstown, N.D. area northwest of Grand Forks, N.D. The land had been too wet for planting three years running, and after the tiling operation, it has been planted every year.

“It has some great yields, and this was a piece that had a lot of alkali soils, and now the alkali’s gone,” Duininck says. “We sold the ground in 2008, because we’re not in the land business, or the farming business.”

In good company

The Prinsco demonstration field site was one way that the company participated in a push toward tiling in the region. Installation companies and university officials have been talking about the concept, and the last five years activity has doubled to a fever pace.

There are many reasons for that.

The biggest reasons for this include the shift to corn and beans to Northern climates that never would have supported them in the past. Commodity prices have been soaring because of world demand and other factors. As the rest of the economy has faltered, outside investors have added to the increase in land prices, which has made the investment in drainage more important.

On the ground in places such as the Red River Valley of eastern North Dakota and northwestern Minnesota, technology has improved to install flat land with precise gradation. Also, with a series of cold, wet springs, farmers are more aware of the significance of getting a field dry enough to plant it in a timely fashion in spring.

The changing climate, whether caused by weather cycles or something more, is underlining the benefits of tile.

“We’ve seen some significant yield increases” with tiling, Duininck says, noting that the tiled fields in many cases can be planted two or even three weeks earlier than non-tiled fields.

On the policy side, the North Dakota market “really opened up” in 2011 with the passage of state legislation that kept some of the decision-making authority on approving tile drainage with local authorities, rather than running it through a state entity.

“There was a lot of pent-up interest before 2011, but when the permitting things got taken care of at the state level, that really made a difference,” Duininck says.

He says with the 5.6 million acres of prevented-planting acres in the state in 2011, many of the acres were idle through the growing season, so tiling could be accomplished.

Proprietary blend

In 2010, Prinsco officials decided they needed to expand into the northern North Dakota area. In 2006, the company had purchased a 7.8-acre piece of land near the Gardner, N.D., interchange on Interstate 29, for a potential production plant, but instead decided to build closer to Fargo, north of the airport.

At the Fargo location, the company will have 22 acres and will build a 30,000 square foot building, compared with the 20,000-square-foot leased building in Moorhead. The Fargo facility will start with two lines but will have room for four, Duininck says.

Like competitors, Prinsco uses recycled products in the manufacturing process.

“It’s one of the hallmarks of what we do, and we’re good at it,” Duininck says.

In 2011, the company introduced an ECOFLO 100 product for dual-wall piping. This ECOFLO blends in at least 40 percent recycled plastic, while maintaining al 100-year service life rating. The rating is awarded by a third party, after the product is run through a high temperature oven for 10 months, simulating the degradation of a product.

The company is actively pursuing employees, and is looking for a manager for its Moorhead plant.

Prinsco’s temporary plant is in the Moorhead Industrial Park, east and south of the RDO Equipment dealership. The building formerly held United Structural Components L.L.C., which made trusses. Importantly, the site has rail access. Initially, the plant will have about 15 to 20 employees.

When the company shifts to the Fargo address, some equipment from Moorhead will be moved to the new location. In the new site, materials will be moved by truck only and employment will increase. The new Fargo plant will be roughly 30,000 square feet and will include all new equipment.

“We look at it as a total Dakotas expansion,” Duininck says. “With our three lines in Beresford, and four in Fargo, we’ll have seven lines in the Dakotas across 24 months,” he says.

Rodelius says Prinsco sells to contractors, but also to farmers, but only those who already own an installation machine.

Prinsco prides itself on a family-owned, family-operated corporate culture.

“We blend well with rural, agricultural communities in America. It’s where our focus is, and where our long-term future is also,” Duininck says.