The Next Level

Marketing firms join to form next generation of ethanol marketing
By Kris Bevill | February 22, 2012

Mansfield Oil Co. has joined forces with global agricultural and energy products supplier Noble Group to create Noble Mansfield Renewable Energy, a joint venture that the companies say will combine their existing marketing abilities to define the next generation of ethanol marketing. The new venture will be headquartered in Bloomington, Minn., where Mansfield’s C&N ethanol marketing business is based. Bill Covey, previously the head of Noble Group’s ethanol marketing segment, will serve as CEO and Jon Bjornstad, founder of C&N Ethanol Marketing, is president.

“The traditional plant marketing approach has to evolve in order to continue to add value for producers in new ways,” Bjornstad says. He began marketing renewable fuels years ago and says that the industry has grown to a point where high-speed, automated transactions are an absolute necessity. Mansfield has adapted to meet these needs, investing heavily in developing its renewable identification numbers (RINs) management and compliance services and automating other aspects of the business to lessen workforce requirements and reduce risk. “Having systems like this really does separate us from the pack,” he says. “Today, in an environment where obligated parties are really concerned with risk, there will soon be a short list of counter parties that refiners are willing to do business with. Refiners don’t want the risk of noncompliance via nonvalid RINs.”

Bjornstad also stresses the strength of Mansfield’s ethanol and distillers grains export program as being a benefit to the new partnership, adding that Noble’s international presence will compliment Mansfield’s previous efforts and help to expand those services to even more markets for their clients.

Covey says Noble brings three key strengths to the new venture: risk management expertise, unmatched financial strength and a history of working relationships with blenders and refiners to market multiple products. “Ethanol producers need a financially secure marketer with large operating scale, direct access to global markets, and a full suite of risk management services,” he says. “This new organization offers plant partners access to unmatched risk management services and a scope of services on a global scale.”

Reflecting on the changes in the ethanol industry over the past two decades, Bjornstad says he thinks the venture between Mansfield and Noble serves as a sign of the times. “The industry is going to have to consolidate and streamline to enable it to run with the energy sector,” he says, adding that the new venture is already prepared for the next step—marketing new fuels and chemicals produced at biorefineries. “As ethanol continues to mature, there will be more innovative ways to produce various products from the plants,” he says. “Mansfield is already a marketer for Gevo’s butanol and we’re ready to market other products ethanol producers come up with.” —Kris Bevill