An industrial plant to derive a nutrition supplement from flax seeds is expected to be operating this summer, providing 10 new jobs and eventually providing a market for an alternative crop to area farmers.
A new business is being developed through a cooperative arrangement between American Natural Soy Processors in Cherokee and Spectrum Organic Products in Petaluma, Calif.
Flax oil is to be cleaned, cold pressed and refined at a plant that will be an extension of the American Natural Spy Processors plant.
Flax oil is a high value health food. Spectrum Organic Products distributes organic health foods nationally. American Natural Soy uses 'an extraction process to produce soybean products.
The new company developed through the cooperative agreement is BIOwa Nutriceuticals, a separate company from both of its parent companies.
Late last year, the Iowa Department of Economic Development announced a $250,000 grant from the Iowa Values Fund to BIOwa Nutriceuticals for the planned $3 to $4 million production facility. According to IDED, the new jobs created would have an average hourly wage of $22.70 an hour and BIOwa would sign contracts with growers for approximately 7,500 acres of flax to supply the operation.
"We could eventually see three times that amount invested," said Mark Schuett, owner, manager and founder of American Natural Soy.
Rees Moerman, a process engineer for Spectrum, came to Cherokee recently to address local farmers about alternative organic crop possibilities. Moerman explained that the plant in Cherokee will be state of the art, keeping Spectrum on the leading edge of producing a product for which there is a growing demand.
"We'll be doing things in Cherokee that aren't being done anywhere in the world," Moerman said.
"The reason we're coming to Cherokee can be summed up in two words - Mark Schuett. People make the difference," Moerman said.
Moerman explained that he wants to establish long-term business relationships with local farmers.
The demand for flax oil has been driven by the nutritional importance of Omega acids found in certain oils. These are most commonly found in fish oil.
The most concentrated plant source is flax oil, sometimes called vegetari- an fish oil.
Because nutritional oils are highly interactive with other compounds, care has to be taken in the growing, harvesting, processing and packaging of the flax seed.
The product marketed by Spectrum is from certified organically grown flax, packaged in water tight, light tight.
A spike in demand for flax a few years ago resulted in the Canadian suppliers pricing themselves out of the business. The Chinese and other countries got into supplying the organically grown flax.
Moerman urged caution for the local farmers present last week at the conference. He expects the farmers to only raise small test plots to see what kind of methods work in the soils and climates of Iowa. Flax has successfully been grown in Iowa but the farmers with experience are now in their 90's. The ISU Extension Service will be working closely with the local farmers to develop growing strategies.
Fanners who grow organically use a multi-year rotation to control pests and restore nutrients. Moerman wants area organic farmers to eventually include flax as part of the rotation.
The flax seed will have to be shipped in when the plant starts operation later this year. It won't be until next year that any significant portion of the flax seed is provided by local growers.
Moerman said that even if no flax is grown locally, the plant will operate. It is expected to be in full production all year round, not just seasonally.
Moerman said he hopes to enter into long term contracts in which the highs and lows of the market are smoothed out by sharing the effects of the fluctuations between the grower
The flax grown for its oil is a different variety than that grown for fiber to make linen. Moerman said there is currently no market for the stems of the plant, but that might change.
Moerman said flax is expected to play an increasingly important role in providing Omega nutrients, as ocean fish are being over-harvested and a supply drop may occur.