Cairo Association of Teachers - Newsletter

CAT Tracks for August 16, 2006

More on an earlier story from the Paducah Sun...

Biodiesel venture to bring jobs to Cairo

The plant will be next to the Bunge North American soybean processing operation in the city.

By Joe Walker

CAIRO, Ill. - A new venture between St. Louis-based Bunge North American and Renewable Energy Group of Ralston, Iowa, is expected to produce a 20-job biodiesel plant next to Bunge's soybean processing operation in Cairo within 15 months.

"It makes sense because the feed stock is already there, and it reduces transportation costs," Bunge Communications Director Deb Seidel said. "The Cairo plant is basically export driven at this point, and this gives it another opportunity to remain viable because export demand has been decreasing."

Seidel said permitting and other hurdles must be cleared before construction can begin, so a groundbreaking date has not been set. The 86-employee grain plant is among the largest industrial employers in Alexander County, which has one of the highest jobless rates in the state.

U.S. Sen. Barack Obama met with Bunge President/CEO Carl Hausmann about a year ago to ask him to consider Cairo for the biodiesel plant, Obama spokesman Tommy Vietor said. Obama joined Hausmann and others Monday when the project was formally announced.

Bunge said it has made a minority investment in and entered into a strategic relationship with REG to produce biodiesel fuel. Bunge will supply raw materials, risk management and logistics expertise to help REG expand. Considered the industry leader of 100 percent biodiesel fuel, REG has produced and sold biodiesel for more than 10 years through predecessor companies.

"Producing high-quality biodiesel is only the first step," REG Chairman/CEO Jeff Stroburg said. "Getting biodiesel to our customers when and where they need it is a key factor in creating a successful distribution channel."

Bunge's involvement with REG "provides us an opportunity to create a strategic alliance with a market leader in the fast-growing biofuels industry," Hausmann said. "It also provides us with a good balance so that we can effectively serve the food, feed and fuel markets."

Legislation pending in Congress to extend the Southernmost Illinois Delta Empowerment Zone beyond 2009 would allow existing and new businesses like the biodiesel plant to continue taking advantage of wage credits, SIDEZ Executive Director Donna Raynalds said. The zone, which funnels federal economic development incentives into the disadvantaged area, is set to expire at the end of 2009.

Businesses in the zone that hire local residents can claim 20 percent of the first $15,000 in wages as income tax credits, she said.

"In effect you can get a $3,000-per-employee wage credit," Raynalds said. "So we're really hoping this will pass."