BP partners with SD Soybean Processors subsidiary to build $500M crush plant

MITCHELL — A subsidiary of South Dakota Soybean Processors is ready to take its first steps toward construction of a multi-million dollar seed processing facility.

High Plains Processing, LLC., was joined by investors, project partners and state agriculture leaders for a private groundbreaking ceremony at the site of the $500 million facility south of Mitchell.

The multi-seed crush plant, which SDSP first announced it would build in February 2022, will have the capacity to process 35 million bushels of soybeans annually or the equivalent of one million tons of high-oil content crops.

More: Queen City Bakery on limited menu as kitchen staff take sabbatical in Paris

Craig Weber, board president of SDSP, said he expects the plant to be in operation in time for the state's harvest by fall 2025.

While the golden shovel ceremony provided the reason for the occasion, the highlight of the event came from the major announcement that High Plains Processing and BP, one of the world's largest companies by revenue, would be starting a joint venture to share ownership of the facility. Dual ownership of the plant will be shared between High Plains Partners, LLC and BP Products North America Inc, a subsidiary of BP.

"The investment by BP further strengthens our business plan by providing direct access and vision into the rapidly growing renewable fuels market," SDSP CEO Tom Kersting said.

The private event also saw attendance from state leadership, including Gov. Kristi Noem and Hunter Roberts, the Department of Agriculture and Natural Resources secretary.

"The new strategic partnership between High Plains Partners and BP will have a monumental impact on not only the Mitchell community, but the entire state of South Dakota," Noem said.

Planned crush plant expected to bring value-added ag to surrounding communities

One benefit of building the facility in Mitchell comes from the value it is expected to bring to the labor force, Weber said. About 85 full-time jobs will be created once the plant is constructed, with a total payroll of about $5.5 million.

"Many of those [85] people will either come from the local communities themselves or people moving to the community from outside of the area with some expertise, so that's always exciting," said David Lambert, director of regional development with Mitchell Area Development Corporation.

But looking outside the Corn Palace city, Lambert said the construction of the crush plant is expected to drive economic traffic to other towns. He said the "real long-term impact" from the facility would come from the "continual" sales tax dollars earned.

More: Runners preparing to once again cross South Dakota for The 437 Project

In Mitchell, these sales tax dollars would mostly stem from farmers purchasing fuel and tires while stopping into town to drop off their latest soybean harvest, Lambert said. Producers would then take their money earned from their crop back to their hometowns, like Corsica and Tripp, where they could spend it locally.

Caleb Finck, board president of the Tripp Development Corporation and farmer, said the addition of the new crush plant in Mitchell will be vital in keeping South Dakota's soybean harvest in the state.

Selling one's harvest to a local elevator, Finck explained, will enter that crop into a larger ag market, but some of what's sold to the elevator is sometimes shipped to out-of-state crush plants. The processed products are then sold outside of South Dakota.

"Some of those elevators are then turning around and putting those beans back on a truck and taking them down to Sioux City to a crush plant that is down there," Finck said. "Anytime you can use that product right where you're delivering it, they're going to be able to have a better basis at the end of the day.

Finck said farmers within a 60 mile radius will find it more economical to ship their harvest straight to the crush plant rather than local elevators.

The multi-seed plant's location could also allow SDSP through High Plains Processing to tap into the sunflower market, as some farmers grow the crop in fields west of Mitchell, Weber said.

This article originally appeared on Sioux Falls Argus Leader: $500M Mitchell crush plant takes first step toward construction