Adding Value to Ethanol
Posted: May 11, 2009
Iowa corn growers are investing in a corn oil and animal feed processor plant to add value to corn ethanol.
The investment in Merrill, IA-based Plymouth Oil Company is being made through Iowa Corn Opportunities, an equity fund established by the Iowa Corn Growers Association for investment and business development. “Plymouth Oil Company represents an important step forward for the corn ethanol industry which is currently suffering from depressed margins. Adding value to corn made ethanol is critical right now,” says Pam Johnson, President of ICO and corn grower from Floyd, Iowa. “Plymouth Oil Company is creating high value human food, high value animal feed while demonstrating that both food and fuel can be economically produced from the same kernel of corn.”
Under the agreement, Plymouth will purchase corn germ for further value-added processing in the Merrill facility. The raw germ will be converted into crude corn oil for human consumption and the resulting de-oiled germ will be incorporated into high value livestock feed. The production plant uses proven hexane extraction technology that efficiently extracts corn oil with targets to produce approximately 60 tons per day of crude corn oil and about 240 tons per day of corn germ meal.
“We are able to increase the protein content of the distillers’ grains, making them more useable as a feed source in the poultry, swine and dairy markets,” says Dave Hoffman, President of POC. Hoffman also says that “corn oil is a high value vegetable oil product that is increasing in demand as food processors switch from hydrogenated soybean oil in an effort to reduce trans-fats.”
Iowa Corn Opportunities made the decision to invest in Plymouth Oil Company because it “ultimately represents an important value added opportunity for the ethanol industry, livestock producers, consumers and corn growers alike.” With the investment, Iowa corn growers will also retain a seat on the Board of Managers for Plymouth.