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University of Minnesota Extension

Potential economic impact and basis analysis of a soybean crush and biodiesel facility near Crookston, Minnesota

Key findings for communities

  • Demand: Polk County farmers planted 326,000 acres of soybeans in 2018, the highest acreage of any Minnesota county. The Minnesota Department of Agriculture, however, estimates current state biofuel production will only provide 53 percent of the biodiesel required to meet Minnesota’s B20 market demand.
  • Soybean basis: A fully operational soybean crushing plant in Crookston will raise the basis by an estimated 10 to 20 cents per bushel.
  • Plant construction: In total, construction of the plant will generate $134.0 million of economic activity in Polk County. This includes $43.1 million in labor income. The plant’s construction will support 820 jobs in the county.
  • Plant operations: Operations of the plant in Polk County will generate $322.8 million of new economic activity. This includes $17.2 million in labor income. The plant will support 330 new jobs.
  • Regional impact: Operations of a new crush and biodiesel plant will generate $323.9 million of new economic activity in the 11-county region (Becker, Clay, Clearwater, Kittson, Mahnomen, Marshall, Norman, Pennington, Polk, Red Lake and Roseau counties). This includes $18.1 million in labor income. The plant will also support 330 new jobs.

About this report

On May 1, 2018, Minnesota’s state biodiesel mandate increased to 20 percent (B20) during the summer months. This means number two diesel (commonly used in trucking) must contain at least 20 percent biodiesel. Soybeans are a primary source for biodiesel, and Minnesota is a leading soybean producing state. However, the state does not currently produce enough biodiesel to meet the mandate.

Investors in Crookston, Minnesota have identified the potential for constructing a new soybean crush and biodiesel plant, primarily using soybeans grown in northwest Minnesota. University of Minnesota Extension, on behalf of the Crookston Housing and Economic Development Authority (CHEDA), completed an analysis of the economic and basis impact of the proposed new plant.

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Authors: Brigid Tuck, Extension senior economic impact analyst, Edward Usset, grain marketing economist,
and Rani Bhattacharyya, Extension educator

Reviewed in 2019

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