Anne Arundel County could be the next owner of the Lothian Grain Elevator which was scheduled for closure later this year by its current owner, Perdue AgriBusiness.
The parties agreed to a purchase price of $1.25 million and have 90 days from contract signing, announced on March 21, to close the deal.
Perdue first announced its intent to close the elevator in January 2021. After speaking with local farmers who depend on the facility to purchase their crops, Anne Arundel County Executive Steuart Pittman spoke privately to Perdue CEO Randy Day about delaying the closure to buy time for a new owner to step in.
“In a very short time frame, we concluded that this facility could and should support local farms for many decades into the future,” said Pittman. “Once purchased, we expect to lease the facility to an experienced elevator operator, and then to work with the Southern Maryland Agricultural Development Commission on plans for additional agriculture support services at the site.”
The county will conduct an environmental assessment and appraisal, and will seek County Council approval for the purchase. The state’s fiscal 2024 proposed budget includes funding to reimburse the county for the purchase and initial capital needs.
“Southern Maryland is a major part of the Delmarva poultry industry,” said Maryland Department of Agriculture Secretary Kevin Atticks. “Keeping this grain elevator open for Southern Maryland farmers to access is vital to the Maryland agricultural community.”
Essential infrastructure
State Sen. Sarah Elfreth, who represents Annapolis and southern Anne Arundel County, was instrumental in arranging the deal, convening stakeholders from Anne Arundel, St. Mary’s, Calvert, and Charles Counties, as well as SMADC, MDA, and the Anne Arundel Farm Bureau to discuss transfer of the facility to a public entity with state financial assistance.
“The elevator is essential infrastructure for our Southern Maryland and Anne Arundel County farmers,” she said.
Although the Lothian facility has long been a critical part of the southern Maryland agriculture community, a significant reduction in farmland and a dramatic reduction in total harvested grain acres over the last twenty years influenced Perdue’s decision to shift its business strategy in the area, Day said.
“While Perdue announced its intention to close the facility in response to these changes, we remain committed to keeping the facility open while finding a suitable buyer,” he said.
Value-added future
According to SMADC executive director Shelby Watson-Hampton, the elevator’s purchase of wheat, corn, and soybeans is indispensable to the success of local farming operations and supports downstream processing ranging from livestock feed to potential international export.
“The closing … would have destroyed farming as we know it in the lower Anne
Arundel and northern Calvert area,” SMADC said in a statement to The Business Monthly. “Only a select few would have been able to add grain storage on their farms or upscale equipment to be able to truck grain out to areas farther away.”
Storage capacity of the Lothian Grain Elevator is 1 million bushels with an approximate value of $8.45 million annually, serving more than 100 farmers and handling or storing approximately 17 percent of Southern Maryland grain.
“[T]he conclusion is that the elevator itself, replete with its additional land, could not only continue current operations, but also grow in importance, support other businesses, and achieve self-sustainability,” SMADC added in its statement.
“We are looking forward to being involved in the new value-added agricultural innovation potential that the site has,” Watson-Hampton said. “We anticipate potential new value-added agricultural projects like a compost facility and possibly an artisanal mill.”
“A mill like this would engage the entire extended agricultural community, from farmers growing premium wheat — and getting a premium price for it — to the elevator operators, the millers, food service professionals around the state, to marketers, sales, and delivery,” added Craig Sewell, Infrastructure Project Manager at SMADC. “The rise of small artisanal millers across the country are proving the effectiveness and the financial viability of this burgeoning industry.”
Expanding options?
Kayla Griffith, of Lothian, said her family primarily produces corn, soybeans, wheat and barley on its 400 acre farm, selling 100% of its grains at the Lothian facility.
“My dad wasn’t sure what path we were going to take if Lothian closed, but we decided to put up grain storage bins in partnership with a cousin,” she said. “We are fortunate that we have options compared to other small farmers in Southern Maryland. Without this facility I expect a number of farmers [would] go out of business.”
Grain production is important to the regional agricultural system because of economics, food security, and soil health, Griffith added.
“I hope [the County] continues to develop the facility to … expand and include other grains and local marketing of specialty grains,” she said.
Anne Arundel County Resolution 9-23, which would approve the terms and conditions of acquiring the Lothian Grain Elevator, was scheduled for a public hearing on May 1.
The earliest the council could vote on the resolution is May 15.