When American businesses close, it’s always a bit sad and sobering. But when it happens in a small town, where the entire community relies on such, it can be even more devastating that when it happens in bustling urban areas.
And for Sidney, Montana, that is exactly what is about to happen.
Here, in the county seat of Richmond County, the population doesn’t even break the 7,000 mark. It’s also the home of the Sidney Sugars processing plant, which has been a mainstay for the town for nearly 100 years.
But come April, the plant, and its 300-some employees will no longer be in business, according to KFGO-AM in Fargo, North Dakota.
The announcement of its closure came on Monday from the parent company American Crystal Sugar Co.
Now, usually, when something like this happens, it’s because parent companies or the powers that be have chosen to find cheaper labor overseas rather than in America’s backyard. But that’s not what has happened here.
Rather, the upcoming closure is because the plant no longer has enough farmers willing to contract with or grow sugar beets anymore, according to the Western Ag Network.
As vice president of agriculture for American Crystal Sugar and the chief operating officer for the Sidney Sugars plant, Steven Rosenau explains that production of sugar beets in the area has drastically dropped in recent years, making it nearly impossible for the plant to remain sustainable and profitable now.
In the 1990s, some 45,000 acres of sugar beets were provided to Sidney Sugars. But now, only a fraction has become available. Rosenau says that 2022 only saw 18,400 acres of sugar beets supplied. And “the year before that, 30,774.” Going into spring of 2023, there are only 19,500 acres available for sugar beet production.
However, as beet farmer Don Steinbeisser Jr. claims, the fault doesn’t lie with the area’s beet growers alone. Sure, some have switched to crops with higher production and profitability rates in recent years. Still, it’s likely that they wouldn’t have felt the need for such a switch without Sidney Sugars’ parent company continually making cuts to their contracts.
As Steinbeisser explains, some farmers in the area, such as himself, have been selling beets to Sidney Sugars for nearly as long as the company has existed. But ever since American Crystal Sugars bought the plant in 2002, their contracts have been forced to be renegotiated every so often, and it’s always the farmers who end up “taking cuts.”
“Over the last five years, we’ve kind of just come to the conclusion that if they took another cut in the contract we were going to be gone. And they did, so we quit. Now they can’t get enough of acres to run the factory.”
And the Montana-Dakota Beet Growers Association has come to the same conclusion.
In a letter to Agweek published Tuesday, the group noted that growers in the area have really done all that they could to keep the plant in operation. After all, for those like Steinbeisser, it’s been part of their family’s livelihood for decades now. However, the sacrifices demanded of them have just come to a point where they are no longer worth it.
The group went on to explain that, on average, sugar beet farmers in the area have had to renegotiate their contracts every three years. And during these negotiations, not only are significant pay cuts being demanded by American Crystal Sugar, but farmers have also had to adapt to using new technologies.
Now, the thing about these new technologies is that they’ve actually allowed production and yield rates to skyrocket, producing more than enough beets to sustain the plant. So even if fewer growers are willing to contract with the plant, it still should have been enough to keep it running.
That is, until more pay cuts were demanded.
It sounds like American Crystal Sugars Co. has essentially shot itself in the foot with its greed. And now, an entire community will suffer.
