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The ruling came over the objections from corn farmers and lenders who were concerned the ruling would destroy area farmers’ trust in the company. That could make it difficult for the southern Minnesota plants to maintain a corn supply when they begin operating.
VeraSun has built the Janesville and Welcome plants, but neither has produced a gallon of ethanol. However, VeraSun laid the groundwork for starting production by contracting with local farmers for millions of bushels of corn.
A group called The Ad Hoc Committee of Corn Suppliers says in a court filing that those farmers who have been storing corn or planning to plant corn for future contracts are now stuck in “limbo.”
VeraSun says the U.S. Bankruptcy Court has also entered orders granting final approval for debtor-in-possession financing totaling $196.6 million.
The financing includes $93.6 million of incremental financing to be provided by certain holders of VeraSun’s 9 7/8-percent senior secured notes due 2012.
The incremental financing will be available to fund operations at ethanol production facilities in Aurora, S.D.; Fort Dodge, Charles City and Hartley, Iowa; and to maintain the idled Welcome facility.
VeraSun operates 16 biorefineries in the Upper Midwest.
