To start with he says that getting information presented a challenge since there’s not a lot of it publicly available. So, without much data to work with he visited personally with industry representatives to find out their thoughts and put together an overview presentation on the subject. He says moisture and how it impacts grinding efficiency and water balance in an ethanol plant were mentioned as well as quality attributes like fermentable starch and test weight. When it comes to the DDGs he says mycotoxins came up frequently as a concern. The bottom line though is that there needs to be research on how grain quality effects the production of ethanol. Hopefully that will be done before another CUTC!

You can download (mp3) and listen to my interview with Leland here:

Companies like Novus International are helping to increase the use of DDGs in pork production by researching how much DDGs can be included in hog rations at different ages for proper nutrition. “We’ve increased the inclusion rates of distillers from just a few years ago, somewhere around ten percent, now to 30-40 percent in some diets,” says Brad Lawrence, Technical Manager for the Novus pork business in North America.

During the recent World Pork Expo in Des Moines, Lawrence said that has fundamentally changed the nutritional content of the pig’s diet, so Novus did some modeling and research and found that including oxidative balance additives in the feed helped get optimum performance from the animals. “Ethanol is here to stay,” Lawrence said. “There’s some concerns about corn availability, but as we put corn into an ethanol plant, we’re getting distillers back out. As swine nutritionists, that means we have to learn what the optimum nutritional technologies are that we can implement to get the most value out of the distillers.”

Listen to an interview with Brad Lawrence from World Pork Expo here:

This is a big deal because China is a big user of corn and normally an exporter, not an importer. The last time China was a net importer of corn was 14 years ago when the country’s crop was hit by drought. This actually marks the first time China has bought U.S. corn in nearly a decade.

It’s also a big deal because we have plenty of corn on hand and another record crop expected, so increasing exports is important for farmers to get some decent prices.

The U.S. Grains Council (USGC) thinks it’s a pretty big deal. “If this is true, and we certainly hope it is, we view it as good news,” said Thomas Dorr, president and CEO of USGC. “This may be the beginning of some opportunities to trade more consistently with China.” Dorr says it’s possible as many as 15 U.S. cargoes have been sold to the Chinese.

China has been an increasingly good market for dried distillers grains (DDGs), the by-product of ethanol production, and Dorr says he expects that to continue. “As a matter of fact, there is still very strong demand for DDGs,” said Dorr. China bought 524,000 tons of DDGs in 2009 and so far this year they have already puchased 240,000 metric tons.

Beef lovers know that high marbling makes a great steak.  Just by looking at the cut in the butcher’s case, they can see the quality.  Corn-fed beef offers better marbling than any alternative.

Now, farmers can achieve the same succulent steak by utilizing the ethanol co-product distillers dried grains.  Created when starch is removed from corn to make ethanol, DDGs are rich in essential nutrients such as protein, fat, minerals and vitamins.  As one bushel of corn produces 2.8 gallons of ethanol and 17 pounds of distillers grains, they offer an economical, environmentally friendly alternative.

The research indicates that beef produced using this product can improve farmers’ bottom lines without compromising quality.  Following the feeding guidelines that the trial recommends even cuts the time needed to prepare the cattle for market.

“We believe feeding a high-grain ration to cattle at a young age and finishing them on co-products is the most profitable way to produce high-quality beef,” said University of Illinois animal scientist Dan Shike.

Research from the University of Nebraska- Lincoln shows that feeding “reproducing cows corn co-products is beneficial to their post calving gain, reproduction and may improve beef production sustainability.”  Again, corn co-products produce a win-win situation as growers can improve profitability implementing suggestions in the while increasing industry sustainability.

With growers increasing profitability and consumers enjoying the same corn-fed taste that they already love, everyone wins.

Some may argue that food and fuel are at odds, but DDGS provide a perfect example of how we can have domestically produced ethanol and a functional and efficient feed product. The more facts that emerge, the more evident it becomes that corn can meet these needs making both refiners and livestock growers profitable while sparing consumer pocketbooks.

But wait just a minute. The latest Consumer Price Index shows consumers are paying less for groceries today than they were just six months ago. The May index for meats, poultry, fish, and eggs was down almost a full percentage point from April and eggs index declined 6.5 percent. The index for dairy and related products fell 0.5 percent in May and has declined 5.6 percent over the past year.

What’s up here, Chicken Little? Because, despite the fact that a number of ethanol plants have closed over the past year, ethanol production is still increasing. The most recent figures from the Energy Information Administration (EIA) were for March and they showed that American ethanol facilities produced 640,000 barrels per day in March 2009 – up 79,000 barrels, or 12 percent from a year ago! Assuming that continues, the ethanol industry will once again produce a record amount of ethanol and distillers grains in 2009.

Point being, at the same time ethanol production is increasing, food prices are heading back downward (finally!). In other words – no correlation. The sky is not falling.

The investment in Merrill, IA-based Plymouth Oil Company is being made through Iowa Corn Opportunities, an equity fund established by the Iowa Corn Growers Association for investment and business development. “Plymouth Oil Company represents an important step forward for the corn ethanol industry which is currently suffering from depressed margins. Adding value to corn made ethanol is critical right now,” says Pam Johnson, President of ICO and corn grower from Floyd, Iowa. “Plymouth Oil Company is creating high value human food, high value animal feed while demonstrating that both food and fuel can be economically produced from the same kernel of corn.”

Under the agreement, Plymouth will purchase corn germ for further value-added processing in the Merrill facility. The raw germ will be converted into crude corn oil for human consumption and the resulting de-oiled germ will be incorporated into high value livestock feed. The production plant uses proven hexane extraction technology that efficiently extracts corn oil with targets to produce approximately 60 tons per day of crude corn oil and about 240 tons per day of corn germ meal.

“We are able to increase the protein content of the distillers’ grains, making them more useable as a feed source in the poultry, swine and dairy markets,” says Dave Hoffman, President of POC. Hoffman also says that “corn oil is a high value vegetable oil product that is increasing in demand as food processors switch from hydrogenated soybean oil in an effort to reduce trans-fats.”

Iowa Corn Opportunities made the decision to invest in Plymouth Oil Company because it “ultimately represents an important value added opportunity for the ethanol industry, livestock producers, consumers and corn growers alike.” With the investment, Iowa corn growers will also retain a seat on the Board of Managers for Plymouth.

“As a feed source, distillers grains offer economic and nutritional benefits to Missouri’s livestock producers,” said Gary Wheeler, Missouri Corn director of business development. “This field day allowed dairy producers to see those benefits firsthand. We hope they will take advantage of this value-added feed and apply what they learned at this event in their own operations.”

During the field day, producers learned the proper storage and handling techniques for dried distillers grains from the McCallisters, who utilize the ethanol co-product in their operation. Jeff Drost (pictured), animal nutrition sales manager with LifeLine Foods of St. Joseph, Mo., explained the latest technology and uses of corn and its co-products and LifeLine also provided the distillers grains for the field day.

According to studies by Agricultural Research Service (ARS) scientists, feeding the ethanol by-product to piglets can give their immune systems an extra boost.

The majority of DDGS are fed to beef and dairy cattle but livestock producers also use DDGS to supplement the diet of older pigs. So Tom Weber, a physiologist at the ARS Swine Odor and Manure Management Research Unit in Ames, Iowa, partnered with research leader Brian Kerr and microbiologist Cherie Ziemer to study the effects of feeding DDGS to young pigs.

What they found was an increase in cytokine expression in the pigs’ small intestine, which they linked to DDGS consumption. Cytokines are chemical messengers that are essential for proper immune function. This response reinforced findings of previous DDGS studies showing that pigs consuming diets supplemented with DDGS exhibited reduced levels of ileitis, a common inflammation of the small intestine.

Because too much fiber can reduce the growth of piglets, the key is to feed them just enough DDGs to boost their immune systems, which the researchers capped at about 7.5 percent, compared with up to 40 percent for adult pigs.