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Davison County panel advances plan for soybean plant south of Mitchell

County Commission will have chance to sign off on project on July 12

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South Dakota Soybean Processors CEO Tom Kersting speaks during a Davison County Planning Commission meeting on Tuesday, July 5, 2022 at the Davison County Fairgrounds in Mitchell.
Marcus Traxler / Mitchell Republic
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MITCHELL — The Davison County Planning Commission voted unanimously Tuesday, July 5 to advance a planned $500 million South Dakota Soybean Processors’ facility south of Mitchell.

The vote was 4-0, with commission members Bruce Haines, Steve Thiesse, Brenda Bode and Ray Gosmire voting in favor of the project. Board members Lewis Bainbridge and Dave Anderson recused themselves for a conflict of interest, due to being investors in the project, while member Kim Weitala was absent. The meeting was held at the Davison County Fairgrounds.

The decision on Tuesday serves as a recommendation for the Davison County Board of Adjustment, which consists of the five county commissioners, who will meet on July 12 at the Fairgrounds to consider the final application of the project. That meeting will be held at 9 a.m., with the facility portion scheduled for no earlier than 10 a.m.

More than 80 people were on hand, with a majority of the speakers indicating either concerns or speaking against the project. The vote came after nearly two hours of discussion and a question-and-answer period involving SDSP’s project leadership.

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A slide shows the proposed layout of the South Dakota Soybean Processors' planned facility near Mitchell during a Davison County Planning Commission meeting on Tuesday, July 5, 2022 at the Davison County Fairgrounds in Mitchell.
Marcus Traxler / Mitchell Republic

If approved on its current timeline, construction would begin in summer 2023, with plans for the plant to be operating in 2025. The project plans to add about 75 full-time jobs in the Mitchell area. The organization is run by 2,200 member-owners in South Dakota and part of Minnesota, and already has processing plants in Volga and St. Lawrence.

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Some of the citizens’ questions about the project remain unanswered or unknown, particularly about how traffic in and out of the plant will be handled. SDSP is paying for a traffic study that is being conducted by a third party and will be provided to the South Dakota Department of Transportation, which will ultimately have the say on how traffic will flow in and out of the facility, which is located on a two-lane highway with nearly 5,000 daily vehicles in the area. The study will also consider the Spruce Street intersection in Mitchell and the two miles down to the proposed plant site. The study is expected to be completed later this year, but some residents asked how the project could go ahead without knowing the traffic considerations.

In a presentation Tuesday, SDSP plant-related traffic is projected at 183 vehicles per day in Year 1, while moving up to 232 vehicles in Year 5, which is an increase of 26%. At its peak, SDSP expects nearly 140 trucks per day and up to 450 trucks per day during harvest season. Train traffic is estimated at about 150 rail cars per week, with 100-car unit trains likely once or twice a month, said SDSP Engineering Manager Carl Odde. A plan for how 257th Street — a township road — will be maintained also needs to be worked out and nailed down during the July 12 meeting.

SDSP CEO Tom Kersting said the Volga plant is comparable to what the organization has planned near Mitchell. Kersting provided aerial photos of the Volga plant in 2004 and then in 2021, with the Brookings County town’s residential area now filling up to the point where new homes have been constructed across the street from the existing plant.

“Those homes wouldn’t be there and we wouldn’t have people wanting to live there if we weren't being a good neighbor to the community,” Kersting said, noting the positive economic and tax impact.

Kersting stressed that SDSP is a South Dakota-owned and operated company, one that stresses safety, service and sanitation in its plants.

“If you call us, you get us,” Kersting said.

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Davison County Planning Commission Chairman Bruce Haines speaks during a meeting on Tuesday, July 5, 2022 at the Davison County Fairgrounds in Mitchell.
Marcus Traxler / Mitchell Republic

More on the plan

The facility will focus on extracting the oils from soybeans and other high oilseed crops, such as sunflowers. The oils are then shipped to businesses to use and package them for human consumption for cooking oils, baked goods, snacks, salad dressings and sauces.

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The plant will be able to process soybeans or high oilseeds but not at the same time, with the expectation of processing 35 million bushels of soybeans annually, along with 850,000 tons of sunflowers, which will each be crushed for meal and extracted for oil.

Nearby landowners also raised concerns about having the industrial plant near a quickly growing residential area of Mitchell, along with the potential air and light pollution and its impact on the country living residents have come to expect.

“I know living in the country comes with agriculture. I thought living in the country meant living next to soybean fields,” Diane Kenkel said. “I didn’t know that would mean living next to an industrial park.”

Resident Doug Johnson, who lives in the same section as the proposed plant, gave the commission a petition that he said had 120 signatures of nearby residents who have issues with the project.

“It’s 24/7 and it’s going to be all lit up,” Johnson said.

Clayton Gropper, a nearby homeowner, asked about the timing of advancing the project, given that there’s still uncertainty regarding the traffic plans and the plant’s water source, given SDSP estimates using 500,000 gallons per day. When asked, project leaders indicated they are discussing an agreement with the city of Mitchell for water.

“It just kind of seems like you’re putting the cart before the horse given how many questions still need answers,” Gropper said to SDSP leaders.

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Ty Eschenbaum, left, of A1 Development Solutions, speaks during a Davison County Planning Commission meeting on Tuesday, July 5, 2022 at the Davison County Fairgrounds in Mitchell.
Marcus Traxler / Mitchell Republic

The project had its share of supporters, as well, noting that the project provided a chance for local farmers to keep their dollars in South Dakota and Mitchell, rather than having to ship soybeans across the country or overseas.

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"We can keep those dollars here. The dollars turn over," farmer Chet Edinger said. "When farmers make money, they spend it."

Paul Hetland, who farms in the northwest part of Davison County, said there was a lot of concern when Poet built its ethanol plant near Loomis, which opened in 2006.

“But things flow orderly,” Hetland said. “There will be growing pains but we have a chance to add value to what we grow here locally, and that is a great opportunity.”

Originally set to be a project with a cost between $400 million to $450 million, updated figures from SDSP indicate the project will cost about $500 million, A1 Development Solutions’ Kyle Peters told the Mitchell Republic on Tuesday.

The Sioux Falls-based firm is assisting SDSP with the site selection, permitting and development processes. He said almost all of that increase can be attributed to rising costs and inflation.

Traxler is the assistant editor and sports editor for the Mitchell Republic. He's worked for the newspaper since 2014 and has covered a wide variety of topics. He can be reached at mtraxler@mitchellrepublic.com.
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