Archer-Daniels-Midland Co. plans to temporarily close its soybean processing plant in northeast Des Moines, raising concerns that Iowa farmers are losing a major grain buyer as they harvest one of their largest crops ever.
Chicago-based ADM is idling its only soybean processing plant in Iowa from mid-October through November for “planned essential maintenance.” ADM said in an email it “forecasted for this project” and can “meet customer needs throughout this timeframe.”
The facility crushes about 5 million bushels of soybeans a month on average, representing about 12% of Iowa's monthly soybean crush, Reuters reported.
The timing of the plant shutdown is unusual with Iowa farmers harvesting their second-largest soybean and corn crops ever, experts say. And ADM’s closure could dampen prices for Iowa farmers, already struggling with high costs to grow the crop.
Many farmers are looking at losses this year.
“We have a large, if not record, soybean crop coming in. So having any plant go down here around harvest time creates some challenges,” said Chad Hart, an Iowa State University economist.
Iowa farmers have combined nearly 60% of the 628.1 million bushels of soybeans the U.S. Department of Agriculture expects to be harvested this year. Nationally, about half the record 4.6 billion bushels had been harvested, the USDA reported Monday .
With some warning, farmers likely looked for different buyers or decided to store their grain and sell it in the futures market when prices improve, said Don Roose, president of U.S. Commodities, an ag brokerage in West Des Moines . That means some elevators in the area may need to store more corn on the ground to make room for soybeans that aren’t processed, he said.
Landus' Brock Seidl said ADM likely has captured the bulk of this year’s harvest. The central Iowa cooperative believes that about 85% of its members’ soybean harvest is complete, said Seidl, the business's vice president for grain.
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“If this shutdown would have happened two or three weeks ago, we would be looking at a completely different scenario,” Seidl said Monday. Elevators like Landus would have been selling train cars filled with soybeans to processors to make room for incoming grain, he said.
“It’s impactful, but it’s not this huge ripple effect,” said Seidl, adding that the large soybean crop also is filling Landus elevator space. "I think they've (ADM) done it in a smart way."
New large soybean crush operations also have opened in recent years in the state — Shell Rock Soy Processing in northeast Iowa's Shell Rock and Platinum Crush in northwest Iowa's Alta. Demand for soybean oil to make renewable diesel and biodiesel is helping drive new operations, with the soymeal fed to chickens, hogs and other livestock.
Even with the added capacity, the monthly soybean crush fell to a near three-year low in August as numerous U.S. facilities were idled for seasonal maintenance and repairs ahead of the massive harvest, Reuters reported. And Hurricane Helene prompted ADM to close another crushing plant in Valdosta, Georgia, last week, according to the facility's website.
On the Chicago Board of Trade, October soymeal futures surged to three-month highs.
Higher prices for soymeal is bad news for Iowa pork production, the largest in the nation. Last year, hog farmers experienced the largest losses in nearly three decades. But they’re beginning to see some improvements, Hart said. “The losses aren't as deep this year as they were last year … but we’re still in a hole,” he said.
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ADM did not comment on the reason for the closure. But the company had agreed to upgrade the Des Moines plant this year to resolve alleged air quality violations under a 2023 consent decree with the Iowa Department of Natural Resources. And in August, firefighters were called to the site for a blaze that was extinguished in about an hour.
In addition to soybean records, both Iowa’s and the U.S.’s corn harvest are expected to be the second largest ever, with the state coming in at 2.6 billion bushels, and the nation’s total, 15.3 billion bushels. Iowa leads the nation in corn production and is second to Illinois for growing soybeans, USDA data shows.
Reuters contributed to this story.
Donnelle Eller covers agriculture, the environment and energy for the Register. Reach her at deller@registermedia.com or 515-284-8457.
This article originally appeared on Des Moines Register: ADM temporarily closing Des Moines soybean processing plant amid record harvest
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