Provision Rail Spur Improves Coop Infrastructure

Submitted photo.

ProVision Partners’ newest addition is benefiting customers of the local coop through improved efficiency and increased capacity.

Completed in October, ProVision Partners’ new rail system at their Auburndale location provides the coop the capability to receive up to 25 cars at a time, with the flexibility to unload multiple commodities at once.

“The new rail spur allows us to bring in more product throughout our company and have a cost saving on freight and also lets us tap more into a wholesale market,” said Korey Sutton, location manager. “This in turn can allow us to pass on more savings to the customer while being able to maintain a competitive position. It also makes us as non reliant on CN availability as we can now hold 25 cars when before we could only unload 5 at a time.”

“Most of the time we will be receiving up to 15 cars at once,” said General Manager Rob Larson. “We now have four receiving areas – one for dry plant food, one for feed commodities, one for liquid fertilizer and another for feed ingredients. Before, we had just one spur line and we were facing challenges with the amount of product we now bring into the Auburndale site.”

Along with the needed expansion, the railroad notified ProVision that the existing line needed to be replaced, so it was a good time to upgrade. Today, they have four spur lines: one for full cars, one for empties, one to reach three receiving areas, and one to reach the fourth receiving area to their recently constructed agronomy plant.

The new rail system also features two mainline switches, for the safety of railroad and cooperative employees.

“The value this new rail system brings to you and your cooperative will have a large impact,” said Larson. “In addition to the obvious freight and basis level savings, it has opened the door for many new wholesale opportunities which will bring considerable revenue back to members.”

On the feed side, the new rail system allows ProVision to bring in commodities such as canola, sodium bicarb, dical, salt and other ingredients by train car rather than by truck. On the fertilizer side, they are able to rail in potash from Canada, as well as liquid urea and other crop nutrients.

“It helps ProVision remain competitive and allows us to access cost savings on a host of products,” added Sutton. “We also now have the option of shipping grain commodities out on the rail which in turn could potentially save us a lot on trucking.”

“Auburndale was a good place to invest in a rail system, given its logistical position in central Wisconsin,” said Larson. “The new system was constructed on heavy rail, allowing us to bring in 110-ton cars, rather than light rail which is limited to 90-ton cars. The system’s location in the center of Wisconsin and on a four-lane highway gives us wonderful wholesale opportunities, because we can easily reach virtually every region of the state.”

The construction of the new automated feed mill, fertilizer plant and upgrading the commodity storage and grain facility with the expanded rail system came just as ProVision was beginning to experience the effects of the nationwide skilled labor shortage.

“Today, we are able to grow your business with fewer people,” said Larson. “Upgrading the rail system was the last phase of our development at Auburndale, which began in May 2016. Construction of a new 12,000-ton dry fertilizer plant and a Cenex® Convenience Store was completed in the spring of 2017. While the new feed mill—capable of manufacturing over 175,000 tons per year—was finished in the fall of 2017. We also converted our old dry fertilizer plant to feed commodity storage and expanded the existing grain site. The whole project came in under budget, and your cooperative, ProVision Partners, was able to finance well over 50% of it, leaving us with $11 million in long-term debt at a very low interest rate.”

ProVision’s debt-to-equity ratio remains strong, with the coop having been able to maintain solid profitability and continue to retire equity and distribute cash patronage all the way through this project.

“Customers should choose ProVision Partners for their agronomy needs because of the knowledge we can bring to their operation as well as the next-to-none service we provide,” said Sutton. “We always stay competitive in the marketplace and our dedication to our customers is top priority. We are a one-stop-shop for your agronomy needs.”

News Desk
Author: News Desk