GRAND FORKS, N.D. - Ultra Green has plans to open a wheat straw fiber processing facility late this year in Devils Lake, N.D. Officials say the new plant is expected to provide an immediate boost to the regional economy.
In 2013, its first full year of production, it will create 112 jobs. That total will nearly double in 2014 and grow to about 400 in 2017.
The estimated 2013 payroll of about $3.9 million amounts to average annual earnings of more than $34,400 per worker, with production line wages starting at about $16 an hour. That is about the average wage in Devils Lake, according to Job Service North Dakota.
It's going to be a major asset, Devils Lake Mayor Dick Johnson says.
Ultra Green, based in Plymouth, Minn., produces a variety of environmentally friendly biodegradable products from pizza pans to tableware and tissue products.
The Devils Lake plant will be the company's first and only manufacturing facility in the U.S., according to CEO Mack Traynor.
The factory, which will be located in an existing building in Devils Lake's west end industrial park, will undergo a $5 million expansion project in 2015. By 2017, all production will be shifted from China to Devils Lake, Traynor says.
Ultra Green also will use locally grown wheat and utilize wheat straw, the stalks or stubble left after harvest. Traynor, a Fargo, N.D., native with family ties in the Devils Lake area, says the local connection was not a major factor in choosing to locate in North Dakota.
It's right in the middle of wheat straw country, he says. There's a good supply of water, and utility rates are good here.
In 2010, an estimated 125,000 acres of spring wheat were harvested in Ramsey County, yielding more than 5.8 million bushels, according to the U.S. Department of Agriculture's National Agricultural Statistics Service's 2011 statistical report.
In 2013, Ultra Green will contract for about 4,000 acres of hard red spring wheat or winter wheat. By the time the facility reaches full capacity in 2017, it will purchase, cut, bale and haul 15,000 to 20,000 acres of wheat straw annually, according to Cal Krupa, the company president and co-founder.
The company, which was founded in 2007 in Plymouth, Minn., started producing its TreeSaver line of products in 2010, contracting with three factories in China that use sugar cane fiber and bamboo to produce biodegradable pizza pans, take-out boxes, bowls, forks, knives, spoons and even toilet paper.
After successfully testing wheat straw as a product source, company officials began searching the United States for a potential factory location, contacting officials in wheat-producing states.
The benefit of making it in the U.S. is huge, Krupa says. We've had several major companies say, 'Call us as soon as you're making the products in the U.S.' We think we can land some very large accounts.
The company received 243 responses from all over the nation, according to Traynor. Officials then narrowed it down to two finalists, Devils Lake and Amarillo, Texas.
In the end, the company preferred the economic development package developed by Forward Devils Lake, the city's economic development agency.
That was a key part of this. They stepped up, he says. They're providing a good job creation incentive for us to come to Devils Lake.
Essentially, it amounts to Devils Lake paying Ultra Green $1,000 per job created - above the initial 100 - annually for 10 years, according to the mayor.
That amounts to a total city investment of about $4 million, less $500,000 that will be contributed from the Governor's Fund, a state economic development fund.
We think it's a wise investment, Johnson says.