Kickstart in Kansas

- Last updated on GMT

Related tags: Ethanol

US food alcohol producer MGP Ingredients has announced that it is
proceeding with plans to restart alcohol production at its Kansas
plant, where an explosion in September caused significant damage to
the company's distillery operations.

US food alcohol producer MGP Ingredients has announced that it is proceeding with plans to restart alcohol production at its Kansas plant, where an explosion in September caused significant damage to the company's distillery operations.

"While we expect that it will take from nine months to a year to complete the total rebuilding process, we anticipate that we could resume some alcohol production at the plant within two months,"​ said Ladd Seaberg, president and chief executive officer.

Although a full damage assessment is still being completed, the company has made a preliminary determination of equipment replacement needs and initiated an engineering study, according to Seaberg. Noting that no firm estimates have yet been made, Seaberg stated that "we believe our insurance will be sufficient to substantially offset rebuilding costs, as well as business interruption costs".

Historically, the Atchison distillery has produced approximately one-third of the company's total alcohol output. During the time the distillery remains inoperable, the company believes that production capabilities at its Illinois facility should be adequate to supply regular customers. However, the company's ability to supply spot business at this time is substantially reduced.

During the past fiscal year, the Atchison distillery produced nearly 60 million proof gallons of alcohol. That amount accounted for approximately 19 per cent of the company's total fuel grade alcohol production and approximately 67 per cent of its total food grade alcohol production.

The company writes in a statement this week that because the Atchison plant's wheat-based ingredient and alcohol production processes are integrated, the distillery shutdown has interfered with the company's ability to produce the base raw material for specialty ingredients at this location.

"Fortunately,"​ said Seaberg "our Illinois operation has been able to produce the base proteins and starches, which are then transferred to the Atchison facility as raw material for producing our specialty products."

Seaberg stated that despite current obstacles, the company has not altered its plans to grow its speciality wheat-based ingredient sales in fiscal 2003, above the $37.4 million (€37.8m) in sales that were realised in fiscal 2002.

Related topics: Processing & Packaging

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