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RIVERTON — Six years ago, almost to the day, a manufacturing plant in Riverton began moving jobs out of the area.
The job exodus began Feb. 15, 2005. By May, AcroTech Midwest completed its move to Watertown, S.D. About 154 jobs went with it.
For two years, the plant — used in part for storage — was a shadow of its former self. The main road through Riverton, reconstructed to handle the plastics manufacturing company’s traffic, led to a vacant parking lot.
But in the spring of 2007 things changed.
Stern Industries was breathing new life into Riverton. And now the company sees growth potential that could bring manufacturing jobs here and tap into a resource at Crow Wing County’s landfill — methane gas.
“We think it’s a feel good story,” said Shawn Hunstad, Stern Industries president. Hunstad said modifying rotational molding ovens to use methane gas instead of natural gas and propane would allow the company to be a low cost producer of parts. That, he said, would make it attractive to industries, such as agriculture, as a parts manufacturer.
“Which means more jobs, which is good for the local economy,” Hunstad said.
Hunstad started at Stern Rubber in Staples in 1991 as a traveling sales representative. As the manufacturer’s business grew, the company began outsourcing jobs to other rubber companies because it didn’t have the machine capacity to do it all. The company’s largest customer, Polaris, asked if it would get involved in plastics as well as the rubber mold business.
AcroTech Midwest, the process plastic manufacturer, made parts for the automotive and the recreational vehicle markets in Riverton. In the fall of 2004, AcroTech reported it was leaving Riverton to build a plant in South Dakota to be more competitive. AcroTech cited tax breaks, incentives and lower utility costs and noted the new plant would probably not have a union, which was in place in Riverton.
The move may not have been as fruitful as hoped as AcroTech Midwest, a member of the Acrometal Family of Companies, was later sold in 2007.
Before moving into the Riverton plant, Stern Industries had purchased Nor-Pak Industries, a rotational molding facility in Brainerd. Nor-Pak Industries was making smoke butlers, those little canisters for cigarette butts and Crow Wing Kayaks. The Riverton plant provided the space for expansion.
Hunstad said AcroTech Midwest found moving the machinery was easier than replacing the skilled labor. And when recreational industry customers started looking for alternatives, Hunstad said he pointed to the ready and skilled workers still available to the Riverton plant.
At that time, Stern Industries specialized in rubber and plastic-molded products. Sales of the combined company — before it was split basically between rubber and plastics in 2009 — grew from less than $200,000 in 1995 to more than $43 million in 2006.
After the split, Hunstad kept Stern Industries in Baxter and Stern Assembly/Rotomolding in Riverton. Last year, sales revenue was $16 million, a reduction from 2009. But Hunstad said there is growth in the rotational molding field and he believes there is the potential to add jobs. The Riverton plant employs about 30 with Hunstad’s combined operations employing about 56 people.
The assembly side of the business has shrunk with a reduction in staff. Hunstad said that followed a change in requirements for fuel tank construction as recreational customers moved to a multilayer blowmolding process. Hunstad said it was tough to compete with hungry automotive blowmolders who were trying to bolster work as vehicle orders slipped with the recession.
When Stern Industries first leased the Riverton facility, a sublease came from CDC Enterprises — which had the proprietary intellectual property for high density polyethylene duct systems used for heating, ventilation and air conditioning. CDC Enterprises was bought out by a new company created for the purchase named AQC Industries.
Hunstad said one of the things holding g back CDC Enterprises was a need to invest in tooling to get into the commercial market as residential construction hit the skids. Now a commerical line of tooling has the company with everything they need, Hunstad said.
“We are seeign a tremendous amount of growth for that,” Hunstad said.
Indeed blue formed duct work was evident in the Riverton plant during a recent tour. Workers poured measured amounts of blue plastic resin that resembled fine grains of sand or even powder into molds, which were put inside large ovens. Through the rotating process, the hot resin sticks to the mold to create the shape, which continues to slowly rotate during cooling. It’s a process that takes care of its own waste products as leftover plastic is ground back down and used again.
Rotomolding is a slower process, but less expensive to get into, Hunstad said, which makes rotomolding attractive to companies seeking more economical processes.
Stern Industries retains its Crow Wing Kayak line, which developed a following for its more flat-bottomed style, including a fishing kayak. The kayaks haven’t been an empasis of late although Ridgeline in Merrifield serves as a kayak dealer for the line. Hunstad said they’d like to manufacture the kayaks and find someone who could take the product to market, perhaps another company with their own kayak line.
Other products created at the plant include water tanks for Water Wars in Pequot Lakes and The Natural Feeder — which mimics grazing for horses as they eat hay through a slotted grate. The molded plastic for The Natural Feeder, an Iowa-based company, is shaped like a square hay bale.
“We’ve really been busy with that,” Hunstad said. “When you see that blue feeder, that’s being made here in Riverton.”
RENEE RICHARDSON may be reached at renee.richardson@brainerddispatch.com or 855-5852.
