Air Force opposes Chinese-owned corn plant for North Dakota

Feb 1, 2023, 4:04 PM | Updated: Feb 2, 2023, 2:27 am

The U.S. Air Force has told North Dakota leaders that it believes a Chinese company’s plans to build a wet corn milling plant near its Grand Forks base poses a “significant threat to national security,” prompting city officials to say they’ll move to stop a project once touted as an economic boon.

The Fufeng Group’s planned $700 million facility would be 12 miles (19 kilometers) from the Grand Forks Air Force Base, a location that triggered some local concern about potential espionage. Gov. Doug Burgum and U.S. Sens. John Hoeven and Kevin Cramer — all Republicans — pressed the federal government in July to expedite a review of any security risk.

U.S.-China business ties have become strained amid growing tensions between the two countries over security and trade issues, which often overlap. China on Monday criticized U.S. controls on technology exports as a trade violation. Fears over spying have led the U.S. armed forces to prohibited the Chinese-owned app TikTok on military devices, and nearly half of state governments across the country have banned the video-sharing platform from state-owned devices.

The Grand Forks Air Force Base is a center for both air and space operations, according to a letter sent to Hoeven and Cramer by Andrew Hunter, an assistant secretary of the Air Force. The senators released the correspondence Tuesday.

“The proposed project presents a significant threat to national security with both near- and long-term risks of significant impacts to our operations in the area,” Hunter wrote. The letter didn’t offer any evidence that Fufeng is a threat, nor did it detail what kind of risks the company’s business might pose.

Still, it was enough to move local authorities to action.

“We believe the city should discontinue the Fufeng project and instead we should work together to find an American company to develop the agriculture project,” Hoeven and Cramer said in a joint statement.

Grand Forks Mayor Brandon Bochenski said in a statement that he will ask his City Council to deny building permits for the project and to refuse to connect the 370-acre (150-hectare) site in Grand Forks’ agri-business park to public infrastructure. The mayor, who previously favored the project, added that the federal government’s response had been “slow and contradictory.”

“It’s clearly a reflection of both the growing skepticism of trade ties with China and a sense of the security risks that come from Chinese investment,” said Adam Segal, director of the digital and cyberspace policy program at the Council on Foreign Relations.

Without knowing more about specific risks the Air Force fears, it’s not clear why the military considers Fufeng’s proposed mill a greater threat than any other Chinese presence in the area, Segal said. The region is already home to a Chinese-owned Cirrus Aircraft plant.

Fufeng officials previously have denied that the plant would be used for espionage. The company declined a request for comment Wednesday. The Chinese Embassy in Washington did not immediately respond to a message seeking comment.

The Grand Forks City Council gave initial approval last February to the project, which officials said at the time could be the largest private sector investment in the community’s history. The governor initially supported it, too.

But council meetings became increasingly heated over the summer amid growing public opposition and the increasingly strained U.S.-China relationship.

Given the “unambiguous” position of the Air Force, Burgum welcomed the city’s decision to try to stop Fufeng from building the mill. He said in a statement that he would support the city’s efforts to find another partner for a corn milling operation.

Privately owned Fufeng makes products for animal nutrition, the food and beverage industry, pharmaceuticals, health and wellness, oil and gas, and others industries. It’s a leading producer of xanthan gum. The Grand Forks site was to be its first U.S.-based manufacturing facility, and it was expected to initially require 25 million bushels of corn annually.

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Air Force opposes Chinese-owned corn plant for North Dakota