“Barley is not competitive with maize (corn, the main U.S. feedstock used to produce ethanol) without such financial incentives, and these were not granted," the document states.

The Virginia ethanol plant was scheduled to be opened in the first quarter of 2010. A fire and related production problems at the plant delayed opening.

Then, a second, more serious fire reportedly was the reason for a second delay in opening. Finally in May 2011, the announcement was made that the plant was being sold to the highest bidder.

The May 2011 announcement sent shockwaves through the Virginia farming community, because Osage Bio had already agreed, via their buyer Perdue, to purchase a large supply of grain from Virginia growers.

Many growers, recall similar bankruptcy cases in which Midwest ethanol plants were shut down, and farmers lost millions of dollars in corn delivered to the ethanol plants.

Fortunately, for Virginia farmers barley contracts were with Perdue Grains, a partner and grain buyer with Appomattox Bio Energy and parent company Osage Bio Energy.

Perdue never wavered and paid for every bushel of barley bought for use in the Hopewell Plant.

The plant was designed to produce up to 65 million gallons of ethanol per year, virtually all of it from barley.

Osage Bio became heavily involved with grain growers and with grain researchers at Virginia Tech to develop economically sound production practices and higher yielding, higher quality varieties of barley for use in ethanol production.

While a few growers invested some money in gearing up for increased barley production, most took a wait and see attitude — a conservative business approach that paid off in this case.

The end of the dream to produce ethanol from barley at the Virginia plant likely will end an aggressive research program geared up by Virginia Tech to help growers quickly boost barley production in the state.

If there is a bright side of the Appomattox Bio Energy plant for Virginia growers, it is the development by Virginia Tech researchers of several new varieties of barley.

For the most part, Virginia farmers will look at the ‘mess in Hopewell’, as some have dubbed it, as another lost opportunity for grain growers in the state to find a viable market for fall planted crops.

rroberson@farmpress.com

 

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