Cargill Plans to Construct Biodiesel Supply Plant in France

04/05/06 Cargill intends to invest more than 50 million euro in the construction of a rapeseed crush plant at its existing site at the port of Montoir in western France. The investment will be made through a joint venture with Sofiprotéol, a financial holding company focusing on the development of oilseed production and outlets for their producers. Cargill will be the majority shareholder and assume all managerial and operational responsibilities. The investment will further support the development of biodiesel production in the country. Construction is expected to commence by the end of 2006.

The plant will crush up to 600,000 metric tonnes of rapeseed per year, the vast majority of which will be sourced locally. This will translate to up to 250,000 metric tonnes per year of rapeseed oil – the main ingredient in the production of the biodiesel. The majority of this oil (up to 80 percent) will be transferred via pipeline to Cargill’s strategic partner, Diester – a sister company of Sofiprotéol – for use in biodiesel production. The investment will allow the two companies to meet the quota allocated to them by the French government. The quota allocation followed the French government’s decision in September 2005 to promote and advance the development of biofuels in the country. The government has prescribed the use of 5.75 percent of biofuels in fuel by 2008, with the target rising to 7 percent in 2010 and 10 per cent in 2015.

As a co-product of the crushing operations, 350,000 metric tonnes of rapeseed meal will also be produced annually at the new plant. This will be sold to the animal feed market.

“This investment further demonstrates Cargill’s commitment both to biofuels production – in response to the increasing demand globally – and also to agriculture in the west of France, in which the company plays a significant role”, comments Hervé De Praingy, head of Cargill’s oilseed crushing and refining operations in France. “The production of biodiesel fits well with Cargill’s strengths in trading, sourcing raw materials, processing, transportation, running top class plants and in focusing on customer solutions. This facility will also create an important new outlet for local farmers.”

The new plant will supplement Cargill’s existing food operations in St Nazaire, which specialise in the crushing and refining of sunflower oil and which represent more than half of the national production of sunflower oil. Meanwhile, Cargill’s plant in Brest will focus on rapeseed and soya production for use in animal feed and biofuels.

Production at Montoir is scheduled to commence in 2008, by which time Cargill expects to crush a total of 1,750,000 metric tonnes of rapeseed, soya and sunflowerseeds at its St Nazaire, Brest and Montoir sites. The rapeseed crush in Montoir is expected to create about 30 permanent jobs, in addition to the 500 people currently employed both directly and indirectly at Cargill’s existing operations in Montoir and St Nazaire.