Over the past several years, you've heard a lot about the ethanol boom. There've been plans for several ethanol plants in our area, but we may not see any of those plants any time soon. That ethanol boom seems more like a bust. There have been talk of plans for ethanol plants in Griggsville and near Paloma. Keokuk and Quincy both have plans to open ethanol plants.
I spoke with Jeff Ewing with the Ewing Development group. He told me, everything is on track. Right now, the group's developing floor plans for 172 acres in the South Quincy Bottoms. Construction will start sometime next year. But plans for other plants are on hold. I spoke with Jim Mentesti with the Great River Economic Development Foundation to find out what's going on.
"The history of ethanol goes back a half a dozen years ago. 50 million gallon production facilities were being discussed and created because the price of corn was so low at the time it made a lot of sense for the plants to talk about 100 million gallons of capacity," said Mentesti.
Now the price of corn has increased. I spoke with crop specialist Mike Roegge. He told me last year corn cost 75 cents to a dollar. Now it's at least $4.25. Roegge says high prices are making it hard for plants to generate income, that's why some plants have stopped its plans. Jim Mentesti says that's caused some investors to back off a little bit.
"You have some saying, should I take my 30 to 40 million, put it some place else where there's a greater return on my investment," Mentesti said.
" It's beginning to sound like if the price of corn were to diminish a bit, the excitement for ethanol continues, we'll begin to see some activity. Not at the level we've heard of, but I think there's room for another one," Mentesti says.
But corn isn't the only factor. The cost of energy, and other factors weigh in as well.
"When you start to talk about $200 to $240 million plant, you're also talking about very significant construction dollars and a lot of high wage construction jobs," Mentesti says.
No mater what the price, ethanol will still be a very important part of our future.
"I think when you have a region as we have here...investors will still consider this part of Illinois," said Mentesti.
I spoke with Jerry Jenkins with the Ursa Farmers Co-op. He was part of a group, that was exploring the possibility of a plant near Paloma. He told me that project is on hold. I also spoke with John Rothgeb, General Manager of T-C Energy. He told me plans to open a plant in Keokuk is on schedule. It's sheduled to open sometime this summer.
The site at the South Quincy bottoms is on schedule. Jeff Ewing with the Ewing Development Group. Right now they're working on floor plans for the 172 acre site. Construction will start sometime in 2009. The project will cost approximately $200(m) dollars.