Cargill’s corn mill closure will provoke ripple effect in Ohio

Cargill confirmed to Platts, part of S&P Global Energy, that it will close its corn milling plant in Dayton, Ohio, a move that Ohio Corn & Wheat Organization says could reduce local competition for corn purchases and pressure farmers' margins -- particularly in Southwest Ohio.

"We can confirm our intention to close the Dayton, Ohio," Hli Yang, senior communications manager, Food Reputation Management Global & North America, said on March 31.

Yang said that the plant will remain operational for at least the next 20 months to allow time for production ramp-down and to enable supply chain adjustments.

The Ohio Corn & Wheat Organization told Platts that losing the Dayton mill is likely to "create ripple effects" across the state's corn market.

"We estimate that roughly 5%–10% of Ohio's annual corn production, or approximately 30 to 70 million bushels, moves through this facility," said the Organization.

Adding that "when a major buyer like that is lost, competition decreases." The change can mean fewer bids, longer trucking distances, higher logistics costs, and ultimately weaker cash prices for growers trying to market grain, especially in Southwest Ohio.

The Organization said that the facility has been part of Ohio's agricultural economy for more than 50 years, changing market dynamics and increasing competition for corn processing.

Corn milling plants convert corn into a variety of products, such as starch, sweeteners, and ethanol, which are used in various sectors, including food, beverage, and industrial applications.

Cargill has 13 corn milling plants in the US.

Data from the National Corn Growers Association showed that the market value of corn products in the US is above $123 billion.

Yang pointed out in the statement that "in the meantime, we (Cargill) remain fully committed to continuing to serve our customers in this market and to supporting our approximately 230 employees through the transition."

Ohio Corn & Wheat Organization said that this closure reinforces what farmers already know: without consistent growth in demand for corn and biofuels, farmers are at risk, and so are the rural communities that depend on them.

"This is a reminder of what happens when demand doesn't keep pace, and why we can't afford to sit back. Policies like nationwide, year-round E15 are among the most immediate ways to help stabilize the farm economy," said the Organization.