Cape County woos plant with potential road work

Friday, July 26, 2002

JACKSON, Mo. -- Cape Girardeau County commissioners will seek a $350,000 government grant to pave the way for a proposed ethanol plant that could be built in a soybean field in the county's Nash Road industrial area.

They said the money would be used to construct a concrete road and extend sewer and water lines to the site. The road would extend 1,000 to 1,700 feet and connect the site to Nash Road.

The county commission will apply to the Missouri Department of Economic Development for the federal money. A decision could come within two months, officials said.

Mitch Robinson, the county's industrial recruiter, told commissioners on Thursday that a Midwest firm is considering building a $50 million ethanol plant on the 32.6-acre tract of farm land south of Nash Road near the Spartech plastics plant.

It could be under construction by year's end and take 18 months to complete, Robinson said.

The plant would employ 35 people initially, but future expansions could double that number, he said. The average pay would be about $10 an hour, and workers would process corn into a fuel additive.

Robinson, who has been talking to the company for about a year, won't disclose its name, saying the project hasn't been finalized, and the company has yet to buy the land. The Greater Cape Girardeau Benevolent Association owns the land, currently planted in soybeans.

If the plant is built, the ethanol would be shipped by truck or rail. In the future, shipments could be made by barge from the Southeast Missouri Regional Port on the Mississippi River a few miles away.

There currently aren't any ethanol plants in Southeast Missouri, although one is being proposed in Malden, Robinson said.

John Lorberg, a Gordonville, Mo., farmer, welcomed the proposed project but cautioned that it won't greatly increase corn prices, which are about $2.40 a bushel.

He said the plant might increase the price of a bushel of corn locally by 5 to 10 cents at most.

"This is going to help a little bit, but it will not make all the farmers here wealthy people for sure," said Lorberg, who grows corn on about 350 acres.

Economics professor Bruce Domazlicky agreed the plant would do little to boost corn prices.

Domazlicky, who teaches at Southeast Missouri State University and monitors economic trends in the region, said federal tax policy is helping to fuel the ethanol industry. The federal tax on ethanol-blended fuel is less than that imposed on regular gasoline. "There is a good chance there would not be much of a market without a favorable tax treatment," he said.

Robinson said companies can receive state and federal tax credits for ethanol plants.

The Renewable Fuels Association estimates that a record 2.1 billion gallons of ethanol will be produced this year. There currently are 63 ethanol plants in the Untied States, and 14 are under construction, the Washington, D.C.-based association said.

Robinson said new environmental regulations in California are boosting demand for ethanol, which helps provide a cleaner-burning fuel.

335-6611, extension 123

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