Mansfield, Noble merge ethanol marketing divisions

By Kris Bevill | February 08, 2012

The Mansfield Oil Co. and global agricultural and energy products supplier Noble Group have combined their ethanol plant marketing divisions to create a new joint venture known as Noble Mansfield Renewable Energy. The new company will streamline operations and open up new marketing opportunities for its ethanol and biodiesel customers, the companies said. Noble Mansfield will be based in Bloomington, Minn., where Mansfield’s C&N ethanol marketing segment is located, and will be led by Noble’s Bill Covey as CEO and Mansfield’s Jon Bjornstad as president.

Bjornstad, who founded C&N Ethanol Marketing and has been servicing the industry since its early days, said one of the biggest challenges facing ethanol producers currently is the need to evolve in terms of marketing their product. One of the major strengths Mansfield brings to the joint venture is the investment it has made in automating systems to provide accurate and efficient RINs [renewable identification numbers] tracking, and to automate plant loading racks, he said. The result is an ethanol marketing program that more closely resembles the methods used by the petroleum industry, which provides them with reassurance that the ethanol they’re purchasing is what they expect it to be, he said. “The ethanol industry is going to have to consolidate and streamline to enable it to run with the energy sector,” he said. “There are still some operations working with handwritten tickets and the day will soon come where no one will buy their ethanol because of the labor intensive nature of dealing with it and the risk associated with doing it. Refiners don’t want the risk of noncompliance via nonvalid RINs.”

The Noble Group will benefit from Mansfield’s automated systems and will in turn contribute its extensive network of international market opportunities for the company’s clients, Covey said. “Noble Mansfield will offer plants a marketing plan which leverages the strengths of Noble’s global reach and Mansfield’s North American distribution system which has deep relations with refiners and retail blenders,” he said. “This combination of abilities will allow us to reach the best possible netbacks and crush margins for our plant partners.” Noble’s large capital reserves will also provide strong financial support to the new company, he said.

Bjornstad said the new company also has an eye on marketing the additional products increasingly being produced at ethanol plants. Mansfield is already signed on to market the biobutanol produced at Gevo Inc.’s first plant, he said. “As ethanol continues to mature, there will be more innovative ways to produce various products from the plants,” he said. “We’re ready to market other products as ethanol producers come up with them.”