SHELDON, Iowa — A northwestern Iowa feed mill is planning a $7.2 million expansion to substantially increase the plant’s ability to make pelleted livestock feed, according to company officials.

“We are excited to make this announcement,” said Scott Lovin, Ag Partners, LLC vice president of feed. “Ag Partners is always looking ahead to ensure we can meet the needs of our customers today and in the future, and this project will provide additional capacity for the customers we serve out of our Sheldon location.

“We anticipate moving to Phase II quickly based on the demand we are seeing in our market area, which will very likely create the need for additional employees.”

The company reported construction on this project will begin immediately, and is slated to open by January 2016. The Sheldon plant will also remain in operation during construction.

Established in 1997, Ag Partners is a joint venture between Alceco, a farmer-owned cooperative in Albert City, and Cargill, operating in agronomy sales and service, grain handling and marketing, feed, petroleum and precision agriculture. Headquartered in Albert City, Ag Partners’ Sheldon plant sits on the O’Brien and Sioux county line, employing nearly 250 full-time workers.

In addition, the company operates 19 locations, which include Matlock, Sheldon, Sutherland, Orange City, Maurice, Merrill, Alton, Hospers, Calumet, Alta, Ellsworth, Royal, Hartley, Emmetsburg, Fonda, and its corporate office in Albert City.

“This significant investment by Ag Partners in a major expansion of their feed mill in Sheldon is great news for farmers in the area,” Iowa Agriculture Secretary Bill Northey explained. “Increasing their production capacity of pelleted feed products will benefit both farmers selling their crops and those looking to buy high-quality feed.

“This is another great example of agriculture and the value-added businesses that help support our small and large communities across the state.”

According to Lovin, Phase 1 is the $7.2 million expansion, announced April 2, and will include the addition of a 140-foot pellet mill tower, one 60-ton-per-hour pellet line and a six-ton mixer, which he said will increase total capacity to 600,000 tons of meal feed annually and 300,000 tons of pellets.

He said this expansion will meet the increased demands in the marketplace as the demands for a premium pelleted product have grown.

The structure is designed with the ability to complete Phase 2 at a minimal cost, which will include sufficient space to install a second 60-ton-per-hour pellet line, increasing total pellet capacity to 600,000 tons.

Lovin said this second phase will be considered at a future date “as business growth warrants,” adding “this project will not impact Ag Partners’ ability to service our feed customers during construction as both locations will remain fully operational during the expansion.”

In 2012, Ag Partners completed a $6.5 million grain expansion in Alton, which added nearly 7 million bushels of permanent grain storage with three new grain bins and load-out capacity of 70,000 bushels per  hour.

This January, Ag Partners completed the second phase expansion of a three-phase project at the Ellsworth feed mill, which included a 250-ton-per-hour receiving system and a 100,000-gallon liquid storage area that will allow the mill to pellet 800,000 tons of feed annually.

“This investment will allow the company to continue to grow our market share in this area, and provide a quality pellet to better serve our customers,” Lovin said. “We are proud to continue to reinvest in the communities we serve.”