New Cargill subsidiary Emerald Renewable Energy LLC is planning to develop four 100 million-gallon-per-year corn ethanol plants in the Midwestern United States. The newly formed company is considering several potential sites in the Cornbelt.
Each plant will use nearly 40 million bushels of corn annually, produce 100 million gallons of ethanol, and more than 300,000 tons of dry distillers grains for animal feed each year. The plant sites being considered include greenfield locations as well as co-locations with Cargill grain elevators and other utility infrastructure providers.
To finance the debt capital for the construction of the plants, Emerald has nominated BNP Paribas as lead arranger and Santander Investment and Standard Chartered as senior co-lead arrangers.
Emerald Renewable Energy LLC is a wholly-owned Cargill subsidiary organized to develop and invest in renewable energy projects across North America. Cargill will provide the initial development capital for the projects. Emerald Renewable Energy will contract with Cargill for services to support the facilities, including corn supply, natural gas, price risk management and the marketing of ethanol and distillers grains.
Cargill is one of the leading ethanol producers and distributors in the United States and an international provider of food, agricultural and risk management products and services.
The Cargill announcement exacerbated Wall Street worries about an oversupply of ethanol in the short term, and shares of publicly-traded ethanol producers slid downward.