Struggling Ethanol Market Claims Another Victim as Tate & Lyle Suspends Construction of Iowa Corn Processing Plant

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Researched by Industrial Info Resources (Sugar Land, Texas)--Tate & Lyle North America (Decatur, Illinois), a subsidiary of Tate & Lyle PLC (OTC:TATYY) (London), has suspended construction of a new corn processing plant that was nearing completion in Fort Dodge, Iowa.

The plant was expected to go into operation in March, but company officials said completion of the estimated $260 million plant has been suspended until the ethanol market improves. The wet corn mill, when fully operational, is expected to process 150,000 bushels of corn daily and convert it into 100 million gallons per year of fuel ethanol and 300 million pounds of industrial starches annually.

As many as 600 workers were on-site in mid-2008, and the company indicated that it would not lay off the 90 employees hired to run the plant. The groundbreaking for the plant took place in September 2006, and the project was being touted as the single largest construction project that the county of Webster, Iowa, had ever seen.

Fort Dodge and Webster County also took a potential hit when another ethanol producer just down the road, VeraSun Energy Corporation (NYSE:VSE) (Brookings, South Dakota), announced a bankruptcy filing in October 2008. Oil refiner Valero Energy Corporation (NYSE:VLO) (San Antonio, Texas) is expected to close a $477 million buyout deal in April 2009 to acquire the ethanol plant, along with five others owned by VeraSun. The 110 million-gallon-per-year Fort Dodge plant is still operational and is expected to stay in production during the transition.

Industrial Info's Ethanol Database provides a comprehensive outline of all current development activities in the emerging alternative fuels market. This database covers 177 ethanol plants in operation and 530 plants under development. It also covers 145 operational biodiesel plants and 245 biodiesel plants under development.

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