Former Otter Tail Ag plant is in good hands

(excerpt from article “Profits Surge for Green Plains” by Erin Golden, Omaha World-Herald)

Omaha-based ethanol producer Green Plains Renewable Energy said recently that its earnings and revenue were up significantly last year.

In 2010, the company’s net income surged by more than 142 percent, to $48 million, or $1.51 per share, up from $19.8 million, or 79 cents per share, in 2009. Revenue nearly doubled to $2.1 billion in 2010, up from $1.3 billion.

Fourth-quarter results, however, were down from a year earlier.

Net income in the fourth quarter of 2010 was $16.4 million, or 44 cents per share, down from $23.1 million, or 91 cents per share, in the same period in 2009.

In a statement, the company said it was positioned well for continued growth, noting the recent acquisition of an ethanol plant in Fergus Falls, Minn.

Green Plains is the country’s fourth-largest ethanol producer, with plants in Nebraska, Iowa, Indiana, Minnesota, Michigan and Tennessee, as well as grain facilities in Iowa, Minnesota and Tennessee.

Its current operating capacity is 680 million gallons per year.

Our Take:
We prefer farmer and local ownership of renewable energy production, because there can be no doubt that local ownership recirculates revenues and multiplies the economic impact of a farm-based energy company.

But the next best thing is a strong, well-led public company. After the experience of 2008-2009, Green Plains leadership may be able to avoid the mistakes made by other big investor-owned, publicly traded ethanol companies. As we approach 15 billion gallons per year, called for in the 2007 Energy Independence and Security Act, and as E15 and higher blends of ethanol take hold across a broader section of the country, farmer-owned plants wouldn’t be able to handle that demand on their own. But then again, we hope forward-thinking politicians and ag leaders can forge federal and state policies that keep farmers directly involved in energy production. There hasn’t been a boon like this on Main Street in America’s small-town that even comes close to farm-based energy.

Biofuels have added just the right amount of demand for grain and oilseed crops to ensure profitability for a great number of farmers. With a solid ethanol operation in Fergus Falls, farmers in west central Minnesota can rest assured of a strong price for their grain. Strong prices mean families can continue to own farms, family farmers can continue to invest in their communities, and in measures that make their farms more productive and that feature effective conservation measures that preserve the region’s natural resources for everyone to enjoy.


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