Archer Daniels Midland Co. (ADM) will close a North Dakota
ethanol plant in April, the company said Monday.
ADM is closing the plant, in Walhalla, N.D., "because its
geographic location and scale made it difficult to compete in the
marketplace," the company said in a statement. It said returns at
the plant weren't sufficient.
The plant had an annual capacity of 30 million gallons per year,
a small amount versus the 1.72 billion gallons of capacity the
company will continue to have after the closure.
The closure will affect 61 employees. ADM said it will offer
severance packages and that employees may have opportunities to
apply for jobs at other company facilities.
ADM announced in January it would cut about 1,000 employees, or
about 3% of its workforce. ADM and other grain merchandisers have
struggled in recent months with poor oilseed processing margins and
volatile markets.
CEO Patricia Woertz also noted in an earnings conference call
last week that ethanol margins have struggled recently amid excess
supplies, although the company signaled that it didn't plan
significant production cuts in response.
Closure of the plant won't affect ADM's ability to serve
customers, the company said.
ADM shares were recently down 0.5% to $29.41 a share.
-By Ian Berry, Dow Jones Newswires' 312-750-4072;
ian.berry@dowjones.com