FARGO, N.D. -- Northstar Agri Industries -- the Fargo, N.D.-based company that is expanding its two-year-old canola processing plant in Hallock, Minn. -- confirms it is delaying its construction start for an even larger canola plant in Enid, Okla.
Neil Juhnke, Northstar president and chief operating officer, says a $250 million plant that had been ready for construction this fall has now been put off until at least next summer, pending reports on how much fall-seeded canola is planted in the region in the next few weeks.
The plant was expected to handle 2,200 tons of canola per day. The company first announced plans to pursue the project in 2012. Juhnke says it's a timing issue and the project is not in doubt.
"We're eagerly waiting to see how many acres are planted this fall," Juhnke says. "They're in the middle of planting." The pertinent region includes Kansas, western Oklahoma and northern Texas.
Up until this past year, acreage growth has been good in the area, which exclusively grows winter canola, so is planted in the fall.
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"Last year (acreage) doubled and we were expecting it to double again this year," Juhnke says. "But they had a strange, wintertime drought, where normally the dry season is in the summer."
"We need 1 million acres to support a plant and last year it was 350,000," Juhnke says. "We had expected it to double to 750,000 acres. Last year at this time, we thought we could get to 1 million acres by the 2016 crop, which is when the plant construction would have been completed."
The company's first plant was built in Hallock and has a capacity of 1,000 tons. It started operating for 2012 crop. The company is in the midst of an expansion to take it to 1,400 tons per day, expected to be complete by October 2014.
