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Tate & Lyle expands US wet mill capabilities

By staff reporter , 30-May-2006

Tate & Lyle is to invest $260 million in the construction of the first phase of a new corn wet mill in Fort Dodge, Iowa.

This investment is designed to capitalise on Tate & Lyle's renewable ingredients capabilities, alleviate projected capacity constraints in Tate & Lyle's value added starch facilities, and increase Tate & Lyle's participation in the rapidly growing US renewable fuel market.

The facility will be built in two equal phases and will ultimately have a capacity of 300,000 bushels of corn per day. The investment is subject to obtaining the necessary regulatory approvals and negotiations with both state and local authorities.

 

The new plant will incorporate the step-changing proprietary technology Tate & Lyle is installing in the Loudon and Sagamore expansions, together with new proprietary energy conservation technology.

 

These will enable the facility to be constructed at a lower capital cost than the traditional corn wet milling process, and to benefit from both dramatically increased starch yields and reduced per unit energy consumption.

 

The first phase will have a capacity of 150,000 bushels corn per day. It will add 100 million gallons of annual ethanol capacity, doubling previously announced capacity, and produce cationic starches for the paper industry.

 

This will free capacity in Tate & Lyle's Sagamore facility (the group's primary US production site for starch-based value added food ingredients) to be used for value added modified food starches. The first phase is expected to be completed in the year to March 2009 and cover the group's cost of capital in its first full year of operation to March 2010.

 

The project will not result in any increase in Tate & Lyle's high fructose corn syrup capacity in the US.

 

"This investment will double our ethanol capacity, producing environmental and energy saving benefits in the US and reducing American oil dependence," said Iain Ferguson, chief executive of Tate & Lyle.

 

"It will also enable us to increase production of higher value added food ingredients at our Sagamore facility.

 

"This new facility will create jobs and expand our US strategic presence into the western corn-belt, increasing demand for locally sourced crops. It also shows how we are building on our research and development and project execution capabilities to grow our business."

 

Tate & Lyle is a manufacturer of renewable food and industrial ingredients. It uses innovative technology to transform corn, wheat and sugar into value-added ingredients.

 

It employs 7,000 people in its subsidiaries with a further 4,800 employed in joint ventures. Sales in the year to 31 March 2006 totalled £ 3.7 billion.