The fate of a proposed Chinese corn mill in Grand Forks, North Dakota, now appears uncertain after city officials, who had long backed the project, now say they had been unaware of the company’s Chinese origins until shortly before it was made public.

“The city has not approved this project,” said City Council President Dana Sande on Tuesday of the proposed plant to be built by Fufeng USA, a subsidiary of the Chinese agribusiness giant Fufeng Group.

Sande added that the council was working through the development agreement officials signed with Fufeng in 2022 “as an overarching risk assessment of several key issues to determine the risk to the community”.

“We are open to additional information,” he said.

Sande’s comments represent a startling reversal of the council’s previous position: that Fufeng USA’s purchase of 370 acres (150 hectares) of land in the city of Grand Forks from a local resident was an economic boon, the start of a US$700 million agribusiness facility on the edge of town, expected to create some 700 direct and indirect jobs and bring in up to US$1 million in added annual property tax revenue.

The city administration’s initial approvals of the project early last year prompted public concerns and outrage because of the China connection – Fufeng is based in Shandong province – and the land’s proximity to Grand Forks Air Force Base, home to US intelligence, surveillance and reconnaissance capabilities.

Indeed, the question of whether the Fufeng project constituted a national security risk reached Washington, eventually provoking a review by the Committee on Foreign Investment in the United States (CFIUS). But last month CFIUS concluded that the land deal was not within its jurisdiction and that it would not block the project.

City officials did not offer an explanation for the change in their stance. However, council members said during a recent meeting that “there were still a lot of due diligence items” pending that are “critical to the community”.

During a recent meeting, the time frame to approve the project was raised but a date for a final vote was not discussed.

The change of heart comes as the city officials have been under constant attack from the residents who oppose the project and say that the CFIUS determination was not a green light to the project.

Some Grand Fork residents have called the plans to build an agribusiness facility a cover for espionage activities monitoring the air force base, about 12 miles to the west. Others have feared it could “bring Communist China” to their town.

Todd Feland, Grand Forks’ city administrator who had welcomed the CFIUS decision as “positive feedback”, said city officials learned the project was Chinese-financed “very late in the process”.

During a council meeting last week, Feland described national security risks pertaining to Fufeng’s proposed facility as “less defined” and subjective”.

In response, council member Ken Vien called for further discussions on the national security issue, suggesting that outside experts should be invited to the city to talk about “what these national security risks really are”.

Fufeng USA did not immediately respond to a request for a response.

Lea Greene, the public affairs chief for the 319th Reconnaissance Wing of the US Air Force, also said that Grand Forks Air Force Base learned about the Fufeng project in November 2021, adding that city officials never sat down with base officials to discuss Fufeng.

“For any project of this magnitude near an Air Force base – wind farms, solar arrays, urban sprawl, composting facilities, etc – each could pose challenges to military flying missions and/or national defence objectives,” she said in an email.

“Advanced notice of any large development is always beneficial to allow us to begin assessing potential impacts to current and future operations.”

https://www.scmp.com/news/china/article/3208653/north-dakota-town-officials-reconsidering-approval-chinese-agribusiness-project?module=more_top_stories_asia&pgtype=homepage