Iowa ethanol company sues marketing partner for $7 million
A flag flies at the Southwest Iowa Renewable Energy ethanol facility prior to a July 2019 visit from then-President Donald Trump. (Photo by Scott Olson/Getty Images)An Iowa company is suing its marketing partner for $7 million in damages caused by alleged errors in attempting to sell fuel-grade ethanol produced in Iowa and Nebraska.
Southwest Iowa Renewable Energy, or SIRE, is a Council Bluffs-based company that has hundreds of member ethanol producers in Iowa, Nebraska, Wisconsin, Minnesota, and 18 other states. It is suing a Missouri company, Bunge North America, with whom it partnered to sell SIRE-produced ethanol.
SIRE is a dry-mill grain processing facility that each year produces millions of gallons of fuel-grade ethanol from grain that originates in southwest Iowa and southeast Nebraska. Bunge is an agronomic business focused on the purchase, storage and eventual sale of products, including ethanol, within North America.
In the ethanol market, it’s common practice for ethanol producers such as SIRE, to contract with ethanol marketers tasked with finding buyers who are willing to purchase the commodity at the highest possible price and then negotiating with rail lines and trucking companies to achieve the lowest possible rates for shipping the ethanol.
In order to do all of that, the lawsuit alleges, ethanol marketers must have expertise related to complicated and ever-changing federal and state renewable fuel standards.
In 2020, SIRE contracted with Bunge to market and sell all of SIRE’s ethanol in return for a monthly fee. The lawsuit claims that until November 2022, Bunge successfully marketed SIRE’s ethanol though a single Bunge employee, Jeremy Ragan, who was conversant with ethanol buyers and well versed in SIRE’s objectives.
However, at the end of November 2022, Ragan informed SIRE that Bunge had terminated his employment. In the weeks that followed, the lawsuit claims, Bunge had inexperienced workers trying to market SIRE’s ethanol but who sold the product at old or incorrect values. In addition, the lawsuit accuses Bunge of failing to submit the necessary paperwork order for it to sell SIRE’s ethanol in California.
The lawsuit alleges that those and “other deficiencies and errors have resulted in SIRE losing profits on, at times, a daily basis … Bunge’s deficient marketing services have cost SIRE at least $7 million dollars between October 1, 2022, through December 31, 2023. SIRE’s damages have continued to accrue daily.”
The lawsuit, filed this week in U.S. District Court for the Southern District of Iowa, seeks “at least $7 million,” plus interest, for breach of contract and unjust enrichment.
Bunge has yet to file a response to the lawsuit. Company officials have not returned calls seeking comment.
Welcome to Billionaire Club Co LLC, your gateway to a brand-new social media experience! Sign up today and dive into over 10,000 fresh daily articles and videos curated just for your enjoyment. Enjoy the ad free experience, unlimited content interactions, and get that coveted blue check verification—all for just $1 a month!
Account Frozen
Your account is frozen. You can still view content but cannot interact with it.
Please go to your settings to update your account status.
Open Profile Settings