Sidney Sugars focuses on commitment to region

Sunday, May 12, 2019
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Jon Decker photo

Brian Ingulsurd (left), Vice President of Agriculture from American Crystal poses next to Sidney Sugars General manager David Garland after a press conference on Monday morning.

Representatives of the American Crystal Sugar Company held a press conference Monday morning in Sidney to address concerns surrounding the longevity of the Sidney Sugars plant, as well as a recent grower contract.

Brian Ingulsurd, Vice President of Agriculture at American Crystal, addressed the press directly.

“Our plan is to continue operations at the Sidney factory,” Ingulsurd said. “Some good evidence of that being the case is that we are spending approximately $3 million in capital this summer here at the factory. That’s the most we spent here in several years.”

The projects include a large gear known as a bullgear that will improve the reliability of the factory, as well as some upgrades to electronic controls.

Ingulsurd said these changes could also help out with efficiency and automation at the factory, which could result in a very “slight reduction” in workforce, but that there wasn’t need for worry.

A main issue the company wanted to hit on was the recently renegotiated contract between the region’s beet growers and the plant.

In Dawson County there are 12 farmers supplying beets to Sidney Sugars, making it a mainstay for many irrigated farms. The new contract lowers the price the plant pays growers for their crops, but Ingulsurd states that’s necessary for both the growers and the plant to continue business.

“I think the growers are frustrated by the fact that the new contract that we just signed with them is going to be paying them a lower amount for their beets,” Ingulsurd said. “But that was something we needed to address. Over the last five years, we’ve not made money in this factory. One of things that we need to do to address that so the factory can operate is to reduce the payment to the growers.”

Ingulsurd also argued that the growers will still remain profitable even with the reduced payments.

“They grow some of the best sugar beet crops in the United States,” Ingulsurd said. “This area is a great place to grow sugar beets. They have above average yields and above average sugar content. Over the last 10 years their yields have been consistently trending upwards.”

Ingulsurd reiterated the relationship between the growers was a mutually beneficial one. If the plant isn’t profitable, then it will eventually have to close. If the plant closes, then the growers would lose their main purchaser of their beets. Inversely, if the beet farmers can’t make a profit on their product, then they’ll change crops. Without crops, well, the plant can’t operate. In short, it looks like both the producers and plant are somewhat stuck in matrimony.

“There has to be profitability in the fields and here in the factory for the continued growing of beets,” Ingulsurd said. “We believe the adjustment of payments will allow us both to be profitable.”

For a period of time, the idea of a beet farmer co-op ownership of the plant was in the works. But eventually that died away. Both the growers and Crystal signed a non-disclosure agreement, but Ingulsurd said that the co-op was no longer on the table.

In addition to the dependence the factory and farmers have on one another, there is a third factor, the future of which is still being determined. This third factor is fuel.

Currently, the plant operates entirely on coal gathered from the Westmoreland mine out in Savage, and uses approximately 25 percent of that mine’s product alone.

“We are exploring the options of getting coal from another source,” Ingulsurd said. That other source, however, is farther away, approximately 100 miles in North Dakota. If that proves to be too much, a third option, natural gas is also being explored. Converting to natural gas would mean other costs for the plant in the form of retrofitting its systems.

While it seems that many factors are quite fluid, For now, it appears that American Crystal is looking to keep the plant going by investing and making it as efficient as possible.

“We’ll continue to put investments into the factory. With the change in the grower payment we assume we will be profitable. Assuming a normal year,” Ingulsurd said.

The Ranger-Review reached out to several Dawson County and Prairie County sugar beet producers, but they either did not return calls or did not wish to comment.

Reach Jon Decker at news@rangerreview.com.

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