BISMARCK, N.D. — The North Dakota Industrial Commission has authorized the Bank of North Dakota to provide a financing program to assist North Dakota’s ethanol producers in securing working capital to maintain operations in the state.
The ethanol industry in North Dakota supports over 10,000 jobs utilizing 140 million bushels of corn to produce 400 million gallons of ethanol and 1.3 million tons of distiller’s grains.
The ethanol industry nationwide has suffered from low demand during the coronavirus pandemic as people have been driving less, reducing the need for both ethanol and the fuel into which it is blended.
The Industrial Commission, which consists of Gov. Doug Burgum as chairman, Attorney General Wayne Stenehjem and Agriculture Commissioner Doug Goehring, said in a joint statement that the effort will use the Partnership in Community Expansion, or PACE, program, which offers buydowns to a borrower's interest rate, in tandem with the legislatively authorized Fuel Production Loan Guarantee program for biofuels.
Under terms of the program, the state’s ethanol producers may access up to $15 million or 50 cents per bushel of corn that would have normally been purchased (or the volume of equivalent feedstock capacity) in the first two quarters of 2020, whichever is less. The Bank of North Dakota will provide buydown from its PACE program up to a maximum of $500,000.
ADVERTISEMENT
To assist private sector banks in providing the loans, the Bank of North Dakota is using its legislatively authorized Fuel Production Loan Guarantee to provide a 100% loan guarantee to financial institutions providing loans to the state’s ethanol producers.
