Vincennes manufacturer expresses concern over tariff impact on planned bioplastics facility
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Vincennes-based AgroRenew says it is facing potential challenges toward the construction of its planned bioplastics manufacturing facility due to President Donald Trump’s tariffs.
The company is planning to build a 196,000-square-foot facility in Vincennes that is designed to transform crop waste from Knox County melon farms into 100% biodegradable plastics.
The company said the tariffs, including the 50% levies on foreign steel and aluminum imposed this week, are “significantly increasing” the project’s expenses, particularly when it comes to the purchase of specialized processing equipment from European suppliers.
“We’ve been monitoring this pretty closely,” AgroRenew founder and CEO Brian Southern told Inside INdiana Business. “It still continues to be an area of concern for our suppliers, because they don’t know if tomorrow there’s going to be a new tariff that impacts their ability to ship into this country.”
Plans for the bioplastics facility were first announced in November 2023. A ceremonial groundbreaking was held the following June, but Southern said the company has spent its time since then finalizing engineering, architectural and land design efforts.
The facility, expected to employ about 300 people when fully operational, will take waste from watermelon, pumpkin and cantaloupe farms in the Wabash Valley and turn them into biodegradable pellets used in the plastics industry.
The company says at full capacity, the facility will be able to produce more than 2 million pounds of plastic pellets per day and ship 300,000 tons of pellets annually.
The effort will also provide a new revenue stream for melon farmers by selling their waste to AgroRenew.
WATCH: AgroRenew prepares to break ground on $83M production facility
AgroRenew is now targeting the fall of 2026 for the start of production, in line with the harvest season for the area’s melon farms. To accomplish that goal, the company aims to begin construction on the facility in earnest this August.
But to do that, Southern said the company needs more certainty on the tariff situation.
“Our operation depends on three critical elements aligning: the timely arrival of our equipment, the completion of our building, and preparation for the harvest season,” he said. “Each factor is deeply interconnected; we cannot install equipment without a finished building, we cannot construct the building without knowing the equipment specifications, and we cannot begin operations outside harvest season.”
While concern remains, Southern said he is confident that the company will be able to overcome the tariff issue. That could come either by President Trump lifting the tariffs or by the company receiving an exemption via a tariff waiver, which would allow the project to move forward without further delay.
“Our biggest concern is making sure that our equipment shows up in the spring [of 2026],” Southern said. “So we really have about a 60-90-day window here where we need to make sure that we’re comfortable that everything is resolved by then. At that point, we would need to make a decision because the length the construction schedule would then start to get impacted.”
The project originally came with an $83 million price tag. However, Southern said the company has been able to bring that number down to about $79 million through design efficiencies, which could help offset some of the tariff costs if needed.
If the tariff issue doesn’t get resolved, Southern said the timeline would shift no more than six months. Regardless, he says AgroRenew remains committed to completing the project.
“We have customers that are ready to do things,” he said. “We have design done. We actually have equipment being built. We have ordered all of our long lead-time items. We just have to get that alignment of the building and equipment showing up and being ready to go at the same time that we begin our harvest seasons.”
Southern noted that the company has received a lot of support from the local, state and federal levels as it works to overcome the tariff situation.