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Tate & Lyle plant to remain closed indefinitely

By Staff | Jun 26, 2009

The Tate & Lyle plant west of Fort Dodge will remain shuttered for the foreseeable future.

Chris Olsen, director of community and government relations for Tate & Lyle, gave an update on progress, or lack thereof, Tuesday.

“I would love to be here to say we have made a decision as to when to resume construction,” said Olsen, who addressed 55 people at a Good Morning Fort Dodge event conducted by the Fort Dodge Area Chamber of Commerce.

Construction at the plant was halted March 18.

At that time, Tate & Lyle officials cited a downturn in the ethanol market as reason for stopping work on the corn wet milling plant. When operational, the facility will have the capacity to produce 100 million gallons of ethanol and 300 million pounds of industrial starch annually.

On April 2, 56 of the plant’s 90 employees were laid off.

Delaying production and divesting workers has cost Tate & Lyle $127,875 – which the company paid to the Iowa Department of Economic Development in May in exchange for a one-year extension of a $1.5 million incentive package, said IDED spokeswoman Erin Seidler.

“We have received that money,” Seidler said.

The incentives were contingent upon creating at least 100 jobs by July 31.

Tate & Lyle now has until July 31, 2010, to reach that goal or prorate the money back to the IDED, Seidler said.

At present, a crew of 18 continues to work to preserve equipment and prepare for an eventual start-up, Olsen said.

Though the date of that start-up has not been set, Olsen reiterated Tate & Lyle’s commitment to the plant.

“Our plan is to resume construction here as soon as possible,” he said.

Among principal conditions required is a sustainable, long-term rebound in the ethanol market, Olsen said.

He advised people in attendance to contact their elected officials to express their support for ethanol -which, according to Olsen, has been the victim of myths and misinformation about its adverse effects.

“It just seems like agribusiness, and corn in particular, has been under attack for the past few years,” Olsen said. “Last year, it was all the rage to blame ethanol for the increase in food prices.”

In actuality, higher energy costs were more to blame for food price increases, Olsen said.

Proponents of ethanol tout its abilities to lessen American dependence on petroleum.

However, Olsen said he was not sure higher oil prices would automatically improve the ethanol market.

To weather the current economic crisis, Tate & Lyle has undertaken numerous companywide cost-saving measures in recent months, Olsen said.

These include an employee compensation freeze and across-the-board cuts of 90 employees throughout the company, he said.

A sucralose plant in McIntosh, Ala., has also been mothballed, Olsen said. Sucralose is the artificial sweetening agent in Splenda, a major Tate & Lyle product.

“We’re taking steps to emerge even stronger financially,” he said.

Contact Jesse Helling at (515) 573-2141 or jhelling@messengernews.net.

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