Northwood oilseed plant soldNORTHWOOD, N.D. — The future of a defunct oilseed processing plant just north of town is murky after the plant sold for $1.1 million at public auction Tuesday.
By: Jonathan Knutson, Forum Communications
NORTHWOOD, N.D. — The future of a defunct oilseed processing plant just north of town is murky after the plant sold for $1.1 million at public auction Tuesday.
The cost of designing and building the plant was $10.2 million.
Agweek could not confirm after the sale if the buyer plans to resume operations here or to move some or all of the plant’s equipment to another location.
The buyer submitted bids online and didn’t appear in person. Neither the auction company that handled the sale nor the bank that had foreclosed on the property would identify the buyer.
An attempt by Agweek to contact the buyer through the auction company, Maas Companies of Rochester, Minn., wasn’t immediately successful.
The plant opened in 2007, employing 24, but it closed two years later after running into financial difficulties. Company officials pointed at the time to weak demand for canola oil and higher-than-expected prices for oilseeds.
Jeremiah Black, Northwood city auditor and administrator, didn’t return a phone message Tuesday. But he said previously that the city was hopeful the plant would reopen.
The farm town of 945 is about 35 miles southwest of Grand Forks.
The auction was held in a repair shop in the plant. Wrenches, grease guns and power cords hung neatly in their assigned spaces on the wall.
About 30 people, some of them apparently coming from outside North Dakota, attended the sale. Only a handful bid on the plant.
Several bidders declined to talk with Agweek after the sale.
The sale price of $1.1 million, just 10.8 percent of the cost of designing and building the plant, was disappointing, said Gary Hoots, senior credit officer for American Federal Bank. The bank, which has a Northwood branch, was one of the original partners in the project and later foreclosed on the plant.
“We were hoping for a lot more,” Hoots said.
He hadn’t met the buyer and couldn’t comment on the buyer’s plans, he said, and referred questions to Maas Companies.
The plant initially crushed soybeans, but later expanded into canola, sunflowers, corn germ and flax, with a daily output of 200 to 300 tons. North Dakota is the nation’s leading producer of canola, sunflower and flax, and soybeans and corn are increasingly popular with farmers in the state.
The plant’s ability to crush a variety of crops would make it more attractive to potential buyers, officials with Maas Companies said prior to the sale.
The sale included all the plant’s equipment, which Maas Companies described as being “in pristine condition.”
The 21,154-square-foot plant is on a 40-acre site adjacent to the BNSF track with space for a 30-car rail spur.
In February, the North Dakota Public Service Commission officially cancelled the plant’s warehouse license and ordered that business at Northwood be discontinued, according to the PSC website.
To resume operations in Northwood, the buyer would need to qualify for, and be granted, a new license, the website said.