Co-op rendering operation
yields biodiesel & more
By Stephen A.Thompson
Assistant Editor
stephenA.thompson@wdc.usda.gov
edwood Falls, Minn., is
home to a co-op biodiesel
plant with a difference.
Most other biodiesel
operations use soybeans
or rapeseed as feedstocks. Northland
Choice biodiesel, however, is made
from a variety of agricultural
feedstocks, including animal fat.
It’s manufactured not as a primary
product, but as one tool among
many to extract the maximum
value from the products of
America’s only cooperative-owned
rendering operation.
Northland Choice biodiesel is
produced and distributed by
Farmers Union Industries LLC, a
corporation wholly owned by
cooperatives: Farmers Union
Marketing & Processing
Association (FUMPA) and
Farmers Union Enterprises, made
up of the state Farmers Unions of
Montana, North and South
Dakota, Minnesota and
Wisconsin. FUMPA was founded
in St. Paul, Minn., by the North
Dakota Farmers Union in 1929.
Its original purpose was to provide
livestock farmers with marketing clout
in dealing with large meatpacking firms.
In 1947, it moved into rendering — the
processing of animals that have died or
are unfit for slaughter for food. This
endeavor proved so successful that the
co-op eventually got out of livestock
marketing altogether.
The LLC was founded in July 1,
2005, and currently has two rendering
complexes that operate as Central Bi
Products: one in Redwood Falls and
another in Long Prairie, Minn. Both
rendering complexes provide full service
rendering, with the majority of the
raw material supply coming from beef
and poultry slaughter plants.
In 1988, Farmers Union purchased a
mink-food processing facility in St.
Cloud, Minn., and in 1989, it launched
the Northland Choice brand of petfood
ingredients. Northland Choice
sells to most major manufacturers of
well-known pet-food brands.
Aggressive innovation
The Farmers Union family pursues
product innovation aggressively, says
Chuck Neece, the co-op’s director of
research and development. A recent
addition is a patented pet litter product
called Swheat Scoop, made from wheat
by-products. It was acquired in 2002
with the purchase of privately held Pet
Care Systems Inc.
Production of the pet litter is consistent
with Farmers Union Industries
policy of diversifying risk while finding
ways to add value to agricultural products.
“Our goal is to support agriculture
in total,” says Neece.
In line with that approach, another
Farmers Union Industries business
in Redwood Falls is
Redwood Metal Works, which
manufactures truck trailers,
including those used by rendering
operations. Another division,
Midwest Grease, collects and
recycles used restaurant fats.
In addition to providing another
tool to help manage risk,
biodiesel production promised a
good return on investment. This
is especially true due to
Northland Choice having
acquired a patent for the use of
glycerin as a feed ingredient.
Glycerin is a major byproduct of
the process that turns natural fats
and oils into biodiesel fuel.
Although a large facility was
originally considered, the co-op
board decided that a conventional, 30-
million-gallon-per-year plant was too
risky, especially since there seemed little
prospect at the time of federal support
for biodiesel prices. The co-op decided
that the best approach would be a relatively
small facility producing 3 million
gallons annually, financed with cash-onhand.
The initial decision to go ahead with
the project was made in March 2004.
Finances got a boost in November of
that year, when the cooperative received
a $500,000 Value Added Producer
Grant (VAPG) from USDA Rural
Development for development of farmbased
renewable energy sources. By
December, the facility was producing
biodiesel fuel — the first biodiesel plant
in the state.
Small, transportable unit
Northland Choice’s biodiesel facility
differs with most other biodiesel plants
that produce the fuel from vegetable
sources in more than just its choice of
feedstock. Most soybean and other vegetable-feedstock operations are invariably
dedicated, stand-alone operations.
Farmer’s Union biodiesel production,
however, is carried out in a small
portion of the large, modern rendering
plant in Redwood Falls. The processing
machinery occupies a space perhaps
twice as big as a semi-trailer. It was
delivered skid-mounted
as a unit by truck. If
plans change, the entire
processing unit can be
removed and transported
to another site relatively
easily.
Neece is proud of the
fact that the Farmers
Union biodiesel operation
was the first in
Minnesota, and says that
its success gave other
cooperatives the confidence
to go ahead with
their own plans for
biodiesel. FUMPA was
an active supporter for
the recently promulgated Minnesota
requirement that all diesel fuel sold in
the state contain at least 2 percent
biodiesel.
Northland Choice’s pioneering effort
has encouraged other biodiesel producers
to consider the use of animal fats.
Neece says the brand could incorporate
vegetable oils as well if demand outstrips
supply. “This new technology
helps both animal and soybean farmers,”
he says, “and that’s what we’re
about.”
