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SDCGA 'encouraged' by Valero’s announcement on corn contracts

The South Dakota Corn Growers Association says it isencouraged by Valero Energy’s decision to offer corn contract holders a portion of their original contract agreement held at former VeraSun ethanol plants.

Valero is offering to pay corn suppliers spot price plus 40 percent of the amount above spot price specified in theiroriginal VeraSun contract. Suppliers whose contracts were set below the current market prices were allowed out of their contracts.

SDCGA president Bill Chase says the announcement is a step in the right direction for Valero to build trust with feedstock suppliers.

Four of the seven plants Valero purchased are currently operating. The company plans to steadily ramp up production at the other facilties.