Biodiesel plant's canola sources to include ND, Canada

TransMessis Columbia Plateau LLC, the new tenant of the biodiesel production facility in Odessa, Wash., has lined up seed supply for the facility’s planned start-up in December, but the firm continues to scout for additional supply.

“We’re always looking for seed,” Joel Edmonds, president of TransMessis Columbia Plateau, or TCP, told the Oil Price Information Service (OPIS) last week.

As reported by OPIS, the Odessa Public Development Authority (OPDA), which is responsible for leasing the facility, announced last week that it had entered into a lease agreement with TCP and that crushing was expected to commence within 30 days. Edmonds told OPIS today that the timetable has not changed.

Edmonds told OPIS that the facility is likely to source canola from North Dakota, which has held the title as the No. 1 canola producer in the United States. TCP also is likely to source canola from Canada and from within Washington state, not to mention the Pacific Northwest canola production area in general, consisting primarily of Washington, Oregon, Idaho and Montana.

“We’ll be pulling from whatever sources we have,” Edmonds said.

One potential supplier that won’t be supplying the Odessa facility – at least for the time being – is AgVentures NW LLC. The AgVentures board has decided not to supply the Odessa facility.

The facility had previously been leased by Inland Empire Oilseeds LLC (IEO). Edmonds and Wally Kempe, the principals of IEO’s largest stakeholder when IEO filed for bankruptcy in December 2012, are also principals of TCP. That largest stakeholder was 1138 LLC, which had a 75% ownership stake in IEO when it filed for Chapter 7 reorganization in U.S. Bankruptcy Court, District of Eastern Washington.

IEO’s original ownership group, primarily the Odessa Union Warehouse Cooperative and Reardan Grain Growers, took a minority stake in IEO in July 2012 when 1138 LLC took its 75% stake in the company.

Odessa Union Warehouse and Reardan Grain Growers are managed by AgVentures NW, LLC. AgVentures was among the creditors listed in the bankruptcy documents filed in December, with AgVentures claiming to be owed $1,144,635.43.

Sources indicate that two other potential canola suppliers – Columbia Grain Inc. (with regional headquarters in Clarkston, Wash.) and Pendleton Grain Growers Inc. (Pendleton, Ore.) also are not lined up to supply the Odessa facility with canola at the moment.

Sources also indicate that Shafer Commodities Inc. in Canada had been contacted about supplying the Odessa facility with canola, but no supply arrangements are in place at the moment.

Side note: Edmonds said that he’s not too concerned about the possibility of the current $1/gal biodiesel tax credit expiring at the end of this year, adding only that a consistent policy would be appreciated.

“It’s been such a whipsaw. The inconsistency doesn’t help anybody. It doesn’t help our petroleum partners, and it doesn’t help us in our industry,” Edmonds said.

According to the Washington State Department of Agriculture (WSDA), IEO crushed more than 25,000 tons of canola in the 12-month period ending Sept. 30, 2012. It shipped more than 3.3 million gallons of biodiesel and sold more than 17,000 tons of canola meal and 130,000 gallons of glycerin. On a tonnage basis, throughput of seed averaged 83% of nameplate capacity, while oil output exceeded 100% of nameplate capacity (based on days operating).

This press release was written by Brad Addington (baddington@opisnet.com). Copyright, Oil Price Information Service (www.opisnet.com).