A Minnesota-based company has started construction on a propane rail terminal in Biddeford.

CHS Inc., an energy, grains and food company, is building the terminal in the Biddeford Industrial Park on land leased from Westfield Inc. of Kennebunk. The terminal will have the capacity to move 20 million gallons of propane annually.

The terminal will be served by Pan Am Railways and is expected to be fully operational by fall.

“This is a collaborative effort designed to help propane retailers serve New England homeowners and businesses with a safe, reliable and competitive supply of propane primarily from North American sources,” CHS Vice President Darin Hunhoff said in a prepared statement.

Biddeford officials and representatives of CHS Inc. were not immediately available for comment.

The Biddeford Industrial Park is located west of Route 1 near the city’s turnpike exit.