Alden, Iowa-based Summit Group announced a project to build the first modern corn ethanol plant in Brazil during the 2014 Farm Progress Show. The project will consist of a US$140 million ethanol plant near Lucas do Rio Verde in Mato Grosso, a leading agricultural state in west central Brazil and the country’s largest producer of corn and soybeans. The project is being financed by Summit Group who is partnering with Fiagril and will be developed by ethanol technology company ICM and built by agribusiness company Marino Franz.
To learn more about the project I spoke with Summit Group CEO Bruce Rastetter who noted that his organization does large crop production, hog production and cattle production and as part of they core business they also have a private equity group, U.S. Farmland Fund, that is providing the financing for the project.
I asked Rastetter “Why Brazil” and he answered that outside of the U.S. they believe this country will play the biggest role in feeding the world. “One of the interesting parts in particular about Mato Grosso is because of improved genetics they’re able to double crop. So they are able to raise the first crop of soybeans and the second crop of corn or cotton so they have increasing corn production in the middle of the continent where it is difficult to get it out. So they are embracing value-added agriculture” explained Rastetter.
So what is the difference between the early U.S. ethanol plants and the modern corn ethanol plant that will be based in Braizl? Rastetter said they are partnering with Colwich,Kansas-based ICM and CEO Dave Vander Griend has been traveling to Brazil with Rastetter and his team for a few years. While the majority of the technology will be the same with an improvement on high protein low fiber DDGs (dried distillers grains) – a just patented process for livestock feed.
To learn more about Summit Group’s corn ethanol plant in Brazil, listen to my interview with Bruce Rastetter: Interview with Bruce Rastetter
I also had the opportunity to speak with Eric Peterson who is the president of Summit Group who talked more specifically about the value-added opportunities the corn ethanol plant will provide the community of Mato Grosso. Peterson explained the area has difficulty getting corn exports out of the region and ethanol into the region. With the new ethanol plant, the corn will be purchased locally and the ethanol and DDGs produced will then stay local – overcoming the export/import barriers of the region. This has made the project and partners very accepted in the community.
Since the technology will provide a different type of DDGs than used in the U.S. a part of the project and because Brazilians are very used to using soy meal, they will be able to complement the soy meal with a high protein product. In addition, with the high fiber feed product they are going to run feed trials with a University of Nebraska nutritionist to learn how to best utilize the co-product.
Peterson believes there is a great opportunity to create synergistic relationships between U.S. farmers and Brazilian farmers. “When we go there we are impressed with some of their technology and how they adapt to large scale agriculture and they are quickly adopting precision technologies that we have here in the U.S. and there is no better place for people to assimilate technology than in Brazil and so I think we can learn a lot from each other.”
The plant is to break ground the next six months and to be operational 16 months from groundbreaking which will occur before the rainy season in Feb/March and will produce 50 million gallons of ethanol per year.
To learn more about the agribusiness aspect of the Summit Group’s Brazilian ethanol plant by listening to my interview with Eric Peterson: Interview with Eric Peterson
View the Farm Progress 2014 Flicker photo album.