LAUREL, Mont. — A Montana company will take a year to research what kind of oil refinery they might build for their existing safflower seed business.
Michael “Mike” J. Bergman, 50, is president of Safflower Technologies International LLC, based in Laurel. The company employs 21 and has about $15 million in annual sales. His father, Jerry Bergman, is minority co-owner and secretary. About 60% of the company’s work is in safflower and the rest in other specialty crops like sunflower, flax and pulse crops.
Mike says STI has spent the past three years researching potential safflower crushing facilities scenarios. Crushing seems cost-effective.
Now, they’re looking at refining options. They received $16,000 from McKenzie County, N.D., to look at ways to retain value in years when weather issues reduced oil quality.
Mike grew up at Sidney, Mont., where his father, Jerry was an agronomist and superintendent at research stations for Montana State University, and in 1995 held a joint position as director North Dakota State University station at Williston. In 2011, MSU hired a separate director at Sidney. Jerry, 76, retains the directorship at Williston.
After high school, Mike pursued college degrees at Minot (N.D.) State University, and in 1995 received a biology degree at Montana State University in Bozeman. Mike launched an identity-preserved wheat business. In 2010, they formed Assured Cropping Systems, worked in intensive management of specialty varieties of wheat. He started in Idaho and moved to Michigan and then to North Dakota.
In March 2002, the Mike and Jerry started a separate company focused primarily on safflower, with facilities on both sides of the state border in the Fairview community. Today, they contract about 40,000 acres of safflower a year, from farmers in North Dakota roughly from Minot to Bismarck and west, and in central and eastern Montana.
The Fairview facilities clean, bag and ship via rail or truck. The company has invested in cleaning equipment, color sorters and robot-style bagging systems. Much of the company’s seeds are shipped to California for crushing. They have sent some to a toll crusher at Cherokee, Iowa.
In their study of crushing equipment, they’ve looked at an expeller press/cold press process. “There’s a big demand for refined oil, also a big demand for raw, expeller-pressed oil,” Mike said. “Right now you should have the capacity to do both if you’re going to be successful.”
Some of the feasibility study is about the physical process, but also about the economics. Among the questions are whether crushing should be exclusive to safflower or a “crossover” to handle flax, sunflowers or even hemp.
Separately, the company has facilities for other crops in the Montana towns of Billings, Broadview and Molt. They handle pulse crops as well as sunflower, safflower and flax. Pulses go to both export and domestic markets. Among their crops are maple peas, Austrian winter peas, as well as green and yellow peas.
But the main focus is safflower.
Seeking a 'sweet spot'
“Now, we’re studying refining, and trying to match up capabilities” with the potential safflower crushing scheme, Mike said. Still undecided is how many of the facilities would get the equipment. Mike thinks one one would be North Dakota and another in Montana.
The Bergmans are aware of pitfalls in the specialty oils markets. Other companies, including AgGrow Oils at Carrington, N.D., in the late 1990s did not survive due to equipment issues.
“The companies that have had good success are the big companies like Cargill and ADM, with facilities of 1,000 to 2,000 tons a day,” Mike acknowledges. “We’re trying to identify a ‘sweet spot’ where you don’t have to be that big a giant — maybe 25 to 100 tons a day and not quite the massive volumes they deal with.”
Jerry notes safflower produces two oil types — high-linoleic, with industrial and cosmetic applications; and high-oleic, for human consumption and for food and for pharmaceuticals, featuring a long shelf life. Mike said the high-oleic has become increasingly popular because of a “fatty acid profile that is second to none” for human consumption. It’s high in monounsaturated fats and low in saturated fats.
Currently, Mike said the company is “aggressively contracting” for safflower and sunflower at about 20 cents a pound, and for flax at $10 a bushel, Mike said. For information, go to safflowertech.com, or call 406-480-4797.