Miss. ethanol plant to temporarily idle by end of November

By Holly Jessen | October 29, 2012

Bunge-Ergon Vicksburg LLC, a 54 MMgy corn-ethanol plant in Vicksburg, Miss., will join the list of temporarily idled ethanol plants at the end of November. “In the current market environment, the value of the ethanol produced at BEV (Bunge-Ergon Vicksburg) is not keeping pace with the cost of the corn to make it,” a Bunge spokesperson said. “BEV will continue to assess market conditions and make a decision regarding the operations of the facility in 2013.”

The decision to idle the plant was also referenced in Bunge’s third quarter financial results, which were released Oct. 25 and reflect data through Sept. 30. The company said its third quarter sugar and bioenergy segment earnings before interest and taxes (EBIT) included an impairment charge of $29 million. It was related “related to the write down of the investment in and a loan to” the ethanol joint venture with Ergon, a company press release said.

Still, excluding that charge, the results on the sugar and bioenergy sector improved when compared to the previous year, Bunge said, pointing to higher milling margins. The third quarter EBIT in that sector was $47 million, compared to $43 million in third quarter 2011. For the nine months ending Sept. 30 it was $108 million, compared to $23 million in the same time period the year before.

“The current market environment, shaped most notably by the severe U.S. drought, has been and will continue to be volatile and complex for everyone who participates in our industry,” said Alberto Weisser, chairman and CEO. “Stocks of corn and soybeans are tight, and the world is adjusting typical trade flows.”

Overall, Bunge reported total EBIT of $441 million, an increase of $220 million compared to quarter three of 2011. It experienced particularly strong agribusiness results, with volumes up 15 percent.

The Bunge-Ergon plant is the only grain-ethanol plant in Mississippi listed on Ethanol Producer Magazine’s Fuel Ethanol Plant Map, which tracks plants 1 MMgy and larger. The state is also home to two cellulosic ethanol plants under development. Blue Fire Renewables Fulton LLC, a 19 MMgy wood waste-to-ethanol facility, is under construction in Fulton and Enerkem Mississippi Biofuels LLC, a 10 MMgy municipal solid waste facility is proposed for Pontotoc.