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ND state-owned flour mill poised for major expansion

GRAND FORKS, N.D. -- When North Dakota opened the nation's only state-owned flour mill in the early 1900s, it stood as a symbol of defiance. Tired of shipping wheat to Minneapolis mills, only to receive a lower price to offset the cost of shippin...

GRAND FORKS, N.D. -- When North Dakota opened the nation's only state-owned flour mill in the early 1900s, it stood as a symbol of defiance.

Tired of shipping wheat to Minneapolis mills, only to receive a lower price to offset the cost of shipping, North Dakota farmers turned to the state, which built its own flour mill to give them a better price.

"It worked back in 1922 and it still works today," says Vance Taylor, president and general manager of the North Dakota Mill and Elevator. "We figure we increase the price of wheat anywhere from five to 10 cents a bushel for the local market."

That means a farmer with 1,000 acres of wheat and an average yield of 40 bushels per acre might earn an extra 4,000 a year.

When a $27 million expansion is completed next fall, the Grand Forks mill will be the largest single milling operation in the country and rank 6th among all flour milling companies, Taylor says.

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It also will continue delivering financial results for North Dakota, which in the 2014 budget saw the mill produce profits of $13.3 million, the second best in its 92-year history.

In the past 43 years, the mill has earned more than $155.6 million in profits and returned more than $87 million to state coffers. The rest is reinvested in mill improvements.

Rising 18 stories above the Grand Forks skyline, the mill has turned wheat into flour for more than nine decades. It has always focused on high quality flour, Taylor says.

"We have a big advantage in the marketplace being located in North Dakota where the highest quality wheat in the world is produced," he says.

Most of the wheat the mill uses is grown in North Dakota or western Minnesota.

It grinds 10 percent of all wheat grown in North Dakota. The state leads the nation in production of hard red spring wheat, a high protein variety preferred for bread flour, and durum which is milled into semolina flour to make pasta.

An average of 85 semitrailer trucks arrive each to dump their loads of wheat -- the amount it takes to keep the mill running.

Quality control starts in a cramped office with a bird's-eye view of the arriving trucks. That's where lab technician Lori Luney dips a remote controlled probe about 8 feet long into a loaded truck.

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Luney carries the sample to a machine that tests moisture and protein level. The wheat is also examined for disease or damaged kernels. Higher quality means a higher price for farmers. Low quality wheat would be turned away.

"North Dakota Mill is pretty fussy on the wheat they take in," she says.

The wheat dumped from trucks is stored in large concrete silos, cleaned and moved in vacuum pipes to the top of the mill. Seven production lines run 24 hours a day, each milling a slightly different product.

Inside, the noise is deafening. On one level, rows of machines roar as they grind the wheat. On another floor, dozens of large wooden boxes gyrate wildly, sifting the ground wheat. A maze of pipes runs between floors.

In a complicated simple process, a kernel of wheat might go through the mill 20 or 30 times before it becomes finished flour.

There's some respite from the noise inside a small room with several computer monitors where everything wears a dusting of flour.

The entire operation has 135 employees, but automation allows just four employees per shift to run the mill. Computers make the mill run more smoothly, and help pinpoint problems, reducing downtime, technician Luke Dudgeon says.

Many of the employees work in quality control and shipping departments.

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The mill produces 3.8 million pounds of flour a day. Much of it goes by rail to large bakeries on the East Coast. The Dakota Maid brand flour is sold retail in 11 Midwestern states.

Ten to 15 rail cars of flour are loaded each day along with 25 semitrailer trucks of bulk flour and about 25 trucks of bagged flour.

While most of the flour it mills goes to bakeries, the mill also serves a growing home baking market.

Taylor hopes demand for flour continues to grow. Another million pounds of a flour a day will flow out of the mill expansion by this time next year.

"Going back a few years we were seeing some fairly steady declines in the number of people that were home baking," he says. "But I think with some of the millennials we're seeing a little bit of a comeback there in home baking and our family flour sales the last couple of years."

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