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American Crystal Sugar Co. no longer contracting with Red River Biorefinery

American Crystal Sugar Co. had contracted with Red River Biorefinery, which opened in Grand Forks in 2020, to provide the plant with sugarbeet tailings that would be turned into ethanol. Under the contract, the tailings that weren’t used for ethanol production were to be used for livestock feed, according to Aaron Bjerke, American Crystal Sugar Co. business development manager.

A white building with trees an cars in front of it.
Red River Biorefinery in Grand Forks, North Dakota, has been closed since April 2022. This photo was taken Sept. 4, 2022.
Ann Bailey / Agweek
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GRAND FORKS, N.D. — American Crystal Sugar Co. has terminated its contract with Red River Biorefinery in Grand Forks.

The Moorhead, Minnesota-based sugarbeet processing company ended its contract with the Grand Forks company this past summer for reasons of default, said Aaron Bjerke, American Crystal Sugar business development manager.

American Crystal Sugar had contracted with Red River Biorefinery, which opened in Grand Forks in 2020, to provide the plant with sugarbeet tailings that would be turned into ethanol. Under the contract, the tailings that weren’t used for ethanol production were to be used for livestock feed, according to Bjerke.

The contract was American Crystal Sugar's only connection to Red River Biorefinery, Bjerke said.

Neither company has outstanding liabilities that resulted from the termination of the contract, he said.

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Red River BioRefinery plans to turn biological waste, including waste from sugar beets, into ethanol. Forum News Service
Red River BioRefinery plans to turn biological waste into ethanol. That included waste from sugarbeet processing, but American Crystal Sugar canceled a contract with the refinery because it hadn't carried out its plan.
Forum News Service file photo

“We, basically, wish the biorefinery well. We hope they get up and running again,” Bjerke said. American Crystal Sugar continues to sell its beet tailings to ranchers for livestock feed, as it has done in the past, he said.

Red River Biorefinery, touted by Grand Forks Region Economic Development Corporation and Grand Forks city officials as a creative company that would turn waste from agricultural processing facilities, such as American Crystal Sugar, into ethanol, opened in 2020.

That year, the coronavirus pandemic hit, making travel difficult and leading to market upheaval, which changed Red River Biorefinery’s focus away from making ethanol fuel to hand sanitizer-grade products. Fuel-grade ethanol, animal feed, and renewable natural gas are still also listed on the company’s website as products it produces.

The North Dakota Industrial Commission, meanwhile, in October 2021 approved funding of $500,000 to Red River Biorefinery, which would use the money to help pay for a study to expand Red River Biorefinery Green Ag Park, located on the north end of Grand Forks.

Telephone calls from Agweek to Keshav Rajpal, a Red River Biorefinery senior staff member, Karlene Fine, North Dakota Industrial Commission executive director, and to BioMass Solution, the Wisconsin-based parent company of Red River Biorefinery, to ask about the study and about the company itself were not returned.

Drew Lehan, Red River Biorefinery plant manager in Grand Forks also declined to answer the questions of an Agweek reporter who visited the plant in person.

Red River Biorefinery, since its beginnings, has been beset by problems. Those have included complaints during the summer of 2020 from north-end Grand Forks residents about strong odors, to plant mechanical failures that resulted in discharges into the Grand Forks English Coulee, to environmental violations, to financial woes.

In 2020, the company had a wastewater bill of $1.33 million, of which the Grand Forks City Council levied about $590,000. The city put the company on a payment plan; the amount, plus $5,000 in late fees, was paid off in 2021.

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Besides financial difficulties, Red River Biorefinery also was fined $40,000 for an environmental violation, including one from the state of North Dakota, which in December, 2021, wrote the company a “cease and desist letter” asking it to stop dumping wastewater in a Grand Forks County gravel pit, according to a Grand Forks Herald story .

Diana Trussell, North Dakota Department of Environmental Quality solid waste program manager, told Agweek in early September that she could not comment about Red River River Biorefinery’s environmental violation, because “it is part of an ongoing enforcement process and we are unable to discuss that unless everything has been resolved.”

“It could be weeks” before Red River Biorefinery corrects the violations, Trussell said. “Sometimes it takes months.”

Lisa Botnen, who leads the city of Grand Forks’ industrial waste pretreatment program, told the Grand Forks City Council Committee of the Whole during a Sept. 12, meeting that Red River Biorefinery is not operating, but is, instead, working on cleanup and winterizing.

Grand Forks City Administrator Todd Feland told the Committee of the Whole at the Sept. 12 meeting that Rajpal plans to update the Grand Forks City Council on the status of Red River Biorefinery and its future plans within the next couple of months at one of its meetings.

Feland also told the Committee of the Whole that he planned to work with Grand Forks City Attorney Dan Gaustad to draft a development agreement with Red River Biorefinery, similar to one that the city has with Fufeng Group Ltd., but narrower in focus.

During an interview with Agweek, Feland said that his understanding is that Red River Biorefinery will reopen in the spring or summer of 2023.

“We’re very hopeful that they can get things corrected and move forward. It will be a valuable asset to our city.

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“Industries like this help our farmers be more successful,” Feland said.

He declined to comment on American Crystal Sugar's termination of its contract with Red River Biorefinery.

In an email to Agweek, Feland said "...as it is not an agreement with the City of Grand Forks and have no personal knowledge of the matter and would leave any comment to the parties that are part of the agreement.”

Keith Lund, Grand Forks Region Economic Development Corporation CEO, also declined to comment about American Crystal Sugar's termination of its contract with Red River Biorefinery.

Grand Forks City Council President Dana Sande said during a Sept. 14 interview with Agweek that he was unaware that American Crystal Sugar had terminated its contract with Red River Biorefinery.

Sande said learning that was the case was not concerning because he knows that Red River Biorefinery has educated and intelligent scientists working for the company who have a vested interest in seeing it succeed.

“That’s a company that has a lot of future thoughts in mind,” he said.

Bjerke said he didn’t know if American Crystal Sugar would contract with Red River Biorefinery if the plant offered it one after startup.

“I can’t say whether we would contract again with them. I think they have some work to do,” Bjerke said.

Ann is a journalism veteran with nearly 40 years of reporting and editing experiences on a variety of topics including agriculture and business. Story ideas or questions can be sent to Ann by email at: abailey@agweek.com or phone at: 218-779-8093.
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