Abengoa Ravenna ethanol plant to shut down temporarily
The Abengoa Bioenergy ethanol plant in Ravenna is beginning a temporary shutdown this week.
Chris Standlee, Abengoa executive vice president, said the shutdown was caused by an unfavorable ethanol market.
“We’ve had an unusually unfavorable market for a fairly long period of time,” Standlee said. “In the last year or two in the ethanol industry, a lot of plants have either done temporary shutdowns or slowdowns. It’s a difficult market.”
The Ravenna plant employs about 50 people and has been open since September 2007. Standlee said the company has made no plans about staffing at this point. He said market conditions will dictate how long the plant is shut down.
Steve Sorum, ethanol projects manager for the Nebraska Ethanol Board in Lincoln, said there are four or five other Nebraska plants that also are operating sporadically and one at Sutherland that did not process fuel at all in 2012.
The Ravenna plant is still running through grain and will produce alcohol for several days before being shut down. Standlee said he expects production to end at the plant within 10 days.
Abengoa also operates a plant in York, which also will temporarily shut down.
Standlee said the company intends to maintain the Ravenna and York plants for short-term operations if the market continues to be unfavorable to long-term ethanol production.
Temporary plant shutdowns aren’t unusual for the ethanol industry.
Sorum said Nebraska’s ethanol production was down 12 percent in the first three quarters of 2012.
“Truthfully, that was a little lower than I expected,” he said.
Owners and operators of all plants are focused on the bottom line.
“They’re producing when it’s profitable and not producing when it’s not,” he said.
High costs, primarily for corn, the past several years have made profitability more difficult.
A huge advantage for Nebraska plants is the ability to sell wet distillers grains, a co-product of corn-based ethanol production, directly to livestock feeders.
“That’s what’s driving profitability for many of these (Nebraska) plants,” Sorum said.
Cattle feeders in particular have built their rations around the availability of an ample, dependable supply of distillers grains.
Sorum said plants in other ethanol states must dry much of their distillers grains in order to ship the feed to livestock producers in other regions of the country, which greatly reduces profits.
Nebraska processors always have had an advantage in selling distillers grains, he added, and that is even more the case now.