GRAND FORKS — City and economic leaders have revealed a budding business deal they say is among the largest projects ever in Grand Forks — one expected to result in a large new factory on the city’s north end, hundreds of new jobs, opportunities for the region’s ag producers and infrastructure improvements that will benefit other potential businesses in years to come.
Though officials close to the deal did not disclose the value of the company’s likely investment, they said it is “historic.”
“It’s the largest single private capital investment in the region’s history,” said Keith Lund, who heads the Grand Forks Region Economic Development Corp.
City leaders revealed the deal this week in a meeting with the Grand Forks Herald. They say the plant will be a “wet corn milling” facility, owned by China-based Fufeng Group Limited, and will consume about 25 million bushels of corn once it’s running at full capacity, sometime around 2024 or 2025. Fufeng Group has not described the facility’s product line yet, but the company reportedly produces starch sweetener, corn oil, amino acids, xanthan gum and a range of other additives.
The company’s products are used in the food and beverage industry, in pharmaceuticals, the oil and gas sector and beyond.
The company expects to construct on a 370-acre site on the north side of town, in the existing agribusiness park.
“We don’t have details yet on the square footage of the actual facility, but we know there will be a lot of rail improvements and a lot of infrastructure improvements needed to serve the project,” Mayor Brandon Bochenski said.
In the near term, Grand Forks is expected to see a burst of economic activity to build the facility. The plant’s construction could draw as many as 1,200 construction workers to the area; work is set to begin in early 2022, with operations starting as soon as late 2024.
“(There’s) probably full production by 2025,” Bochenski said, estimating the plant’s consumption at about 25 million bushels of corn a year.
“Adding value to our corn and other raw commodities is critical to North Dakota’s long-term economic success, and this value-added project represents a huge opportunity for producers and workers in the Grand Forks area and our entire state,” Gov. Doug Burgum said.
EDC Director of Business Development Brandon Baumbach said it’s a “game-changing” development for area farmers, and Lund said “the benefit to the agriculture community and farmers will be significant.”
The venture has a behind-the-scenes history that Bochenski dates to June 2020. The 16 months of work saw Fufeng Group slowly narrow a field of dozens of potential cities before selecting Grand Forks.
“From the very beginning, we felt that Grand Forks was a great place to be located. It was evident early on that there was strong collaboration between the local and state government as well as with non-governmental partners and this became even more apparent as our evaluation process went on,” Eric Chutorash, COO of Fufeng Group’s American operations, said in a statement.
The fierce competition for Fufeng Group’s business led the city to woo the company with incentives, such as temporary breaks on property taxes. Local leaders also are expected to build important nearby water and road construction that will link it to the city’s infrastructure grid.
Bochenski said there is a tentative agreement to give the new facility a 90% property tax break for its first 10 years of existence, followed by a 75% tax break for its next 10 years, before reverting to normal property tax rates.
Grand Forks also will have to accommodate the plant’s need for boosted infrastructure, such as water input from the Red River, boosted wastewater capacity, a rail line and the like. Feland said those costs could reach between $80 million and $100 million over the next several years, though he said prior to this deal, $44 million already was set to be spent over the coming 10 years.
Company representatives are expected to visit Grand Forks later this month, when further negotiations will take place. City leaders said that a draft agreement with the company was not yet publicly available, but would be disclosed in coming weeks.