Is there a full moon out or what? In my normal course of scanning news, web sites and blogs for information I discovered a veritable trifecta of absurdity regarding petroleum the other day.
My favorite article had to be about a new study arguing that eliminating federal tax deductions for intangible drilling costs and for US oil and gas production expenses would hurt oil production growth and devastate future US natural gas development.
The Wood Mackenzie study was commissioned by none other than the American Petroleum Institute. (nod, nod, wink, wink). Aren’t these the same companies (foreign & domestic) who were raking it in hand over fist from 2003 to 2008 and making record profits?
We have seen repeatedly that domestic oil price shocks are a result of refining and distribution problems more than even supply. Mix that in with inadequate competition in the oil industry and an ample dose of bad energy policy and you get a real mess. Maybe this is why the petroleum giants have tried repeatedly to discredit the performance and viability of ethanol.
This might go a long way toward explaining why they have so energetically fought against “tax incentives for blending ethanol” that actually go the ethanol blender…once again oil. Forgoing short term gain for long term profit is not a new concept. It also would explain their reaction to the current effort to raise the amount of ethanol in a gallon of gasoline.
Increased ethanol demand cuts into petroleum’s profits and their ability to manipulate the market. The economic impact of being able to control a product we are addicted to from cradle to grave is heady and lucrative stuff. (more…)
The American Coalition for Ethanol (ACE) honored corn growers for their efforts in promoting ethanol at the 23rd Annual Ethanol Conference and Trade Show in Kansas City this week.
On Wednesday night, staff members of the South Dakota Corn Growers Association and Corn Utilization Council received the President’s Award from ACE for “principled dedication and support” of the industry. SD corn executive director Lisa Richardson and legislative director Teddi Mueller received that award. Also, the National Corn Growers Association (NCGA) and 11 corn grower states were recognized with the “Paul Dana Marketing Vision Award” for their support in making the BYOethanol campaign possible.
NCGA president Darrin Ihnen of South Dakota addressed the ACE conference yesterday and talked about some of their efforts to promote ethanol, as well as their partnership with the organization to speak with a unified voice in Washington on issues important to the industry. Darrin sported fluorescent pink fingers at the conference, not as a new fashion statement, but proof that he is a working farmer as they came from vaccinating hogs the day before on his South Dakota farm.
Darrin talked about those big issues facing the ethanol industry right now – the expiration of the blenders tax credit at the end of this year and the delays in approval of E15 – as well as the lack of an energy bill in the Senate that includes provisions for renewable fuels. “We’re disappointed that they’re not going to do anything, but at the same time, the bill that Reid had introduced didn’t have anything in it for ethanol, so it gives us a little more time to get some ethanol provisions in that bill,” Darrin told me. “The downside is that they already don’t get a lot done so by pushing it back to September, that’s even less time before the elections.”
In our recent series discussing ethanol a lot of the information has been more philosophical in nature and has focused on some of the critics and their motivations. The idea was to get you thinking in a skeptical way rather than beat you up with statistics. That ends with this installment which will discuss petroleum. (Skip to the end for the stats).
Black Gold, Texas Tea, or carbon crack…at the end of the day there is a reason they call it crude. Even in its refined form it remains crude. This stew of dead, decayed plants and animals we call oil is nothing but another anachronistic fossil fuel that is little removed from cavemen rubbing sticks to keep us warm.
We may have become highly technical and efficient in finding oil and getting it out of the ground but the final product remains, well…crude.
Over the years more than 200 ingredients have been put in gasoline to try to make it burn better, make your engine knock less, and sometimes just because it was a convenient way to make unpleasant chemical waste products from the petroleum industry disappear out your exhaust pipe.
And all of us gonzo gas mavens would ignore the obvious imperfections and hideous social costs because it was abundant, cheap and made our powered toys sing. Cars, boats, motorcycles, weed-whackers, generators, power washers, etc…..Yikes, the list does go on.
Today, I would gladly trade in my heated seats, directional headlights, and GPS for a modern fuel (hopefully domestic) and new engine technology that moves us away from the oil-fed internal combustion dinosaurs we depend on today.
If we can have cell phone technology that changes daily, digital television technology sharper than the human eye can even see, and tractors that steer themselves we surly should be able to market a functional, fuel efficient and more environmentally friendly car that runs on a cleaner, renewable fuel source. (more…)
A recent study attempted to make the case that if the U.S. government allowed the ethanol tax credit to expire it would have very few adverse consequences for the U.S. industry. The fact the study was funded by the Brazilian sugarcane ethanol industry was dutifully avoided.
Anti-ethanol folks, who have been receiving a lot of attention on this blog of late, made sure the study got plenty of media splash because it helped them further their own causes. Interesting they didn’t showcase the source of the funding for the study or point out how badly Brazil’s sugarcane ethanol industry lusts after access to the world’s largest ethanol market…the USA.
And in today’s budget conscious environment in Washington, DC their efforts are getting some traction. The direct cost of the ethanol incentives is being reviewed independently without any comparative assessment to savings in farm bill costs, how much we spend militarily on protecting our petroleum shipping lanes, or the economic fallout from depending on foreign oil. Federal tax revenue generated by the production and use of U.S. ethanol totaled more than $8 billion in 2009, $3 billion more than the value of the tax credit.
It is amazing how quickly some of our elected officials have forgotten the core rationale for putting the US ethanol tax credit in place. President Ronald Reagan, who was not exactly a political Dove, regularly noted it is in America’s best interest to reduce the world’s dependency on oil from unstable regions of the world.
That’s why Reagan and virtually every president since has asked domestic alternative energy producers like ethanol to step up. He also noted the expense related to America’s foreign oil addiction and how helpful bringing these energy jobs and the billions of dollars ($1 billion day) we send overseas could be for the U.S. economy.
Despite this clarion call the aforementioned detractors, which mysteriously enough include some environmental groups, like to preach the benefits of sugarcane ethanol; sometimes called “slash-and burn ethanol.”(See attached photo). It’s even more amazing some U.S. regulatory agencies actually tout Brazilian ethanol as an “advanced biofuel over the American made corn product. In case you were wondering the photo shows a burning cane field in Brazil. The Sao Paulo area alone burns 8,000 sq miles of field producing incredible amounts of volatile compounds and particulates.
To make harvesting easier, which reduces manual labor costs, sugarcane fields are burned prior to harvest to remove the plants’ leaves. Considering the near slave labor conditions in some cane fields I guess this burning might seem a gift for the machete wielding masses, despite the obvious environmental costs of the massive burning.
If critics are truly concerned about our fuel needs and specific environmental and economic consequences consider the following:
Data from the Brazilian sugar organizations clearly shows they are planning, by 2020, to export 63% more sugar and export 336% more ethanol – all at the expense of increasing the land area required for sugarcane by 78%. Corn based ethanol is being provided with increased corn yields on the same acreage and using modern production processes throughout the production chain.
Sugarcane ethanol provides primarily ethanol, with some electircal cogeneration. Corn based ethanol provides ethanol, high protein feed for livestock, corn oil, and even captured CO2 from the fermentation process to carbonate soft drinks.
Sugarcane ethanol provides jobs that don’t meet subsistence level incomes, while jobs in the ethanol production chain are highly skilled jobs that provide long term employment and taxable income for local schools etc…
And the next time you want to get on a soapbox promoting sugarcane ethanol consider the following items below which are being ignored to make Brazilian product look better than it is:
Ignoring direct and indirect emissions from crop residues;
Use of inappropriately low fertilizer rates;
Failure to account for energy inputs for dehydration of hydrous ethanol;
Failure to accurately assess transport of ethanol from Brazil to U.S.
Failure to assess actual cane harvesting practices and processing in Brazil
At the end of the day if the U.S. ends up importing more ethanol, then we will once again lose a domestic growth industry, export American jobs, and become dependent on foreign energy producers.
Dear New York Times…Your editorial today regarding corn-based ethanol is superficial, either uninformed or malicious, and a disservice to the citizens of this nation looking for real energy solutions we can implement today.
Before addressing some of the onerous points in your piece, please take a look at the attached photo. This is not from the BP spill in the Gulf but rather the latest incident in Michigan which has dumped a million gallons of oil into a river and is now 80 miles from polluting Lake Michigan. Oil is and always has been a loaded gun from an environmental perspective. From leaking tanks at service stations to oil tankers grounded on coral reefs in storms. No more explanation needed on this one.
However, perhaps the biggest point you fail to address is wind, coal, and geothermal don’t make your car go. Natural gas can be used as an automotive fuel but it too is not renewable and has other issues I won’t go into here today. Solar….I’ll race you with my bicycle.
Will ethanol be made from other sources some day? Undoubtedly. Other biomass sources show real potential and will come with the proper research and development, but corn-based technology and infrastructure is the very launching platform for this effort. Yet opponents would have us build our domestic energy house without a foundation.
Ethanol…dubious environmental benefit? Line up the hundreds of studies regarding ethanol, look at the funding sources and consider what is left. What you will find is a long trail of reputable scientists and institutions public, private and governmental that clearly shows the environmental benefits of ethanol.
When compared to petroleum especially, ethanol is a rock star in regard to cleaning the air, maintaining water quality, and soil management. On the oil side think tar sands.
Your reference to the land use issue is also comical. Incredible productivity on our existing corn acres is easily supplying the growing ethanol industry while also meeting the needs of other markets. And yield growth is accelerating.
And finally, I think we must aggressively pursue all forms of renewable, domestic energy given the finite nature of petroleum and do so in good conscience because of the legacy we stand to leave future generations. To suggest we put our entire energy investment in “maybe someday” sources while ignoring a viable and tested source like ethanol is shortsighted at best.
My brother-in-law recently asked me why ethanol had a great reputation for two decades and suddenly seems to be getting pounded constantly, especially in editorial/opinion pages by the media.
He doesn’t have a farming background and isn’t invested in the ethanol industry so he is a neutral and somewhat uninformed observer. He is also one of the busiest guys I know so for him to notice it means the anti-ethanol crowd are now officially pervasive. Apparently, it’s not just me feeling paranoid.
The conversation came back to me in a hurry this week with the latest “ethanol is evil” Tsunami rolling across the country once again. It started with the Wall Street Journal (No link here because you have to pay for this tripe) and the Washington Post and worked its way across the country hitting the Chicago Tribune and Des Moines Register yesterday and likely making its way for the West Coast like some cheap traveling circus.
And like the aforementioned Circus the anti-ethanol gang leave a trail behind much like Barnum and Bailey’s elephants only there is no guy with a shovel and bucket cleaning up in their wake. They leave their load of “misinformation” to fester in the road in full knowledge that most people are also too busy to check the veracity of their propaganda.
The public lynching of ethanol began with the bogus food vs. fuel charade in 2008 and since then has continued to resurface over and over again in several different guises that get trotted out and recycled whenever opportunity presents itself.
Several things remain consistent as the attacks continue. The noxious cocktail they serve up is made with equal parts of the best bad science money can buy and poor logic. And the olive on the toothpick seems to be just plain old avarice.
That’s greed, materialism, or covetousness with a Capital “C.” The people fanning the fires of these attacks have rationale and motivation that are simple if not transparent. They are the folks that want the cheapest corn possible because it boosts their profits; want ethanol to be made from another source; or want ethanol crippled forever because the market share just got too big.
So, for the next couple of days come back here and you will get a sneak peak each day of some of these players and the Machiavellian games they play and fund all to snuff out the only real competition that imported petroleum faces in the marketplace today…ethanol.
If you haven’t already tuned into the new level of activism in agriculture, especially regarding misinformation on our largest industry, then you won’t find better evidence of this evolving cultural phenomenon than the Corn Farmers Coalition.
Speaking to a couple of family farmers recently they expressed their frustration at the misinformation, innuendo and outright fabrications that are being used to frame their chosen profession. As upset as they were, there was also a prevalent sense that there was nothing they could do to change things.
If you are frustrated and tired of all the attacks and negative news swirling around agriculture you have come to the right place. Read slowly, soak this up, and then if you are a corn farmer give yourself a big pat on the back.
Imagine 60,000 city people getting a positive message about farmers every day. As they go to and from work, go out for dinner, go to a movie, or just go about their life in general. Next imagine that most of these people are employed in jobs on or near Capitol Hill in Washington, DC…Congressmen, staffers, agency employees, lobbyists, environmental groups, and even media. That’s what is happening right now as you read this thanks to the efforts of farmers themselves.
In the attached photo of the Union Station Metro stop in Washington, DC you can see several of the ads that will be prevalent throughout June and July as part of CFC’s efforts. From the highly trafficked Metro system, to Reagan National Airport, to the most widely read political publications like Politico and Congressional Quarterly. Throw in on-line advertising at the aforementioned publications, WashingtonPost.com, National Public Radio, ads in the Washington Nationals baseball team programs, and a smattering of talk, sports, and contemporary radio and you begin to get a feel for the breadth and scope of this campaign. It is conservatively estimated the educational campaign will create more than 10 million positive impressions in the land of policy and regulation.
Equally as impressive is that CFC, and the $1 million in corn checkoff funds backing the campaign, comes straight from family farmers in Maryland, Virginia, Ohio, Kentucky, Indiana, Illinois, Missouri, Iowa, Wisconsin, South Dakota, Nebraska, Colorado, Kansas and Michigan who believe we need to introduce a foundation of facts to the dialogue in Washington.
Ten messages based on USDA and EPA facts will be used in the campaign to show tech-savvy, innovative farmers are growing more corn every year – for food, animal feed, ethanol and exports – while using fewer resources and protecting the environment.
The coalition will meet with media, members of Congress, environmental groups and others to talk about what’s ahead: how U.S. farmers, using the latest technologies, will continue to expand yields and how this productivity can be a bright spot in an otherwise struggling economy.
We have a great story to tell so take heart. You can make a difference and CFC offers clear evidence.
An old saying states that you can tell the measure of someone by the company they keep. In that regard, the American Meat Institute is keeping some rather curious company these days as it wages war on an imagined enemy, the corn ethanol industry. AMI recently signed onto political letters and advertisements with environmental extremists like Friends of the Earth, the Natural Resources Defense Council and the Environmental Working Group that they should avoid at all costs. These three organizations have all attacked animal agriculture with the same level of rhetoric as PETA or the Humane Society.
As the self-proclaimed representative of the “companies that process 95 percent of red meat and 70 percent of turkey in the U.S. and their suppliers throughout America,” AMI really should avoid such curious connections.
I recently asked someone very familiar with the membership of AMI – companies like Tyson’s, Smithfield and Hormel – to help me understand the logic that would persuade AMI to take these actions. He laughed and said, “You have to realize, these are companies whose business is ‘blood on the floor,’ and all that they can see is short-term.”
Fortunately, most of the rest of agriculture is trying to take a long-term view and has realized that it is high time to put petty differences aside and agree to disagree on certain issues – like ethanol policy, with the realization that we all have much greater battles to fight with those outside of agriculture who are threatening to undermine the very fabric and structure that has made us the most successful and productive sector in the U.S. economy.
Among the challenges common to row-crop and animal agriculture are the following:
The Humane Society of the United States, whose goal is to completely change the structure of animal agriculture in the United States. If successful, it would result in a significant increase in the cost of meat produced here, drive much of our meat production out of the U.S. and undermine much of the demand base for row crop agriculture. AMI should be solidly opposed to HSUS and be an active part of the groups that are working to oppose HSUS. Instead, they are embracing Friends of the Earth, a solid ally of HSUS and a cohort in HSUS efforts.
Indirect land use change. AMI signed on to letters supporting the application of this mythological impact of biofuels. In EPA and California Air Resource Board modeling, that single theory changed domestic ethanol and biodiesel from being advanced biofuels to being worse in greenhouse gas measures than gasoline. If that sticks, where will that put the carbon footprint of the domestic livestock industry – the single-largest user of U.S. corn and soybeans?
Commodity prices. Seemingly the reason AMI has formed its unholy coalition is to make more corn and soybeans available and at a cheaper price, for the livestock industry and eliminate the competition for such by the ethanol industry. Yet AMI’s “allies” in this fight roundly condemn corn and soybean production as environmentally unfriendly. An NRDC representative, in recent Congressional testimony, suggested that we grow “too much” corn in the United States and we ought to be growing less. NRDC also has promoted eating “grass-fed” over “corn-fed” beef.
House Ag Committee Chairman Collin Peterson. Regardless of political affiliation, few of us in agriculture can help but be grateful for congressional leadership like that of Rep. Peterson. Apparently AMI is one of those few. Their friend and ally, Friends of Earth, last month named Chairman Peterson their 2010 “Biofool of the Year.”
AMI’s high-profile, expensive media and ad campaign is nothing but classic short-term thinking and “blood on the floor” mentality. What is to gain in the short-run by embracing the very people who are out to put you out of business? Their recent ad spawned an editorial in the Washington Times this week titled “Stop Big Corn.” Just as emotional labels like “factory farming” and “corporate farms” are unfortunate, inaccurate and misleading, with more than nine out of 10 farms being family-run, so are labels like “Big Corn.”
The American Meat Institute is doing itself and its industry and all of agriculture a major disservice by engaging in these scorched-earth tactics and being a part of this unholy alliance. It’s time for some long-term thinking and for all of us in agriculture to work together and not split ourselves apart. There are plenty of folks doing a pretty good job of that – they don’t need any help from AMI.
“A fool thinks himself to be wise, but a wise man knows himself to be a fool.”
– William Shakespeare
House Agriculture Committee chairman Collin Peterson of Minnesota has received a great honor – he was named the “Friends of the Earth Biofool of the Year.” The award was established by FOE “to recognize leaders that promote dirty biofuels” – especially corn ethanol.
Chairman Peterson should be very proud of this award, since he received almost 2,300 votes from FOE members and was the clear winner among five nominees – many of whom are very deserving, like
Bob Dinneen, president and CEO of the Renewable Fuels Association. Hard to believe that he beat out the “Reverend of Renewables!” For a good laugh – watch the video of the FOEs going to present Peterson with the award. They even include a can of corn with the presentation – which has nothing to do with corn ethanol, of course.
Peterson won the award from FOE primarily because of his work to make the Waxman-Markey climate bill more favorable for agriculture and biofuels. According to FOE, Peterson’s Biofoolery includes, “demanding that the EPA stop factoring deforestation into environmental impact assessments of biofuels, trying to exempt dirty biofuels from key global warming standards, and trying to open forests and natural areas for biofuels exploitation.”
Congratulations to Chairman Peterson. We need more fools like that on the Hill!
The Environmental Protection Agency loves family farmers. Let me count the ways…ethanol, atrazine, carbofuran, water quality issue related to livestock operations…the list goes on. Like a drunken sailor on shore leave one of government’s most crucial agencies seems to be out of control and stumbling from one issue to the next with complete disregard for science, protocol or the future of our most important profession.
From a bogus land use argument that could curtail future ethanol expansion to an ongoing review of atrazine, arguably the most widely studied and repeatedly exonerated chemical of all time, EPA has clearly lost its grip on its operational directive if not its mission.
The most recent example is EPA’s decision to move forward with banning carbofuran (Furadan), one of the few effective products against rootworm available on the market. (It also makes non-biotech corn production possible to service important overseas markets).
“EPA’s unprecedented attempt to deny any review of its science deprives the registrant and the growers who use carbofuran the right to prove that the product is safe, and represents a bold abuse of power in contradiction of the agency’s earlier commitments to transparency and good science,” said Dr. Michael Morelli, Director of Global Regulatory Affairs for FMC Corporation. (more…)
NCGA president Darrin Ihnen of South Dakota addressed the ACE conference yesterday and talked about some of their efforts to promote ethanol, as well as their partnership with the organization to speak with a unified voice in Washington on issues important to the industry. Darrin sported fluorescent pink fingers at the conference, not as a new fashion statement, but proof that he is a working farmer as they came from vaccinating hogs the day before on his South Dakota farm. 
House Agriculture Committee chairman Collin Peterson of Minnesota has received a great honor – he was named the 
The Environmental Protection Agency loves family farmers. Let me count the ways…ethanol, atrazine, carbofuran, water quality issue related to livestock operations…the list goes on. Like a drunken sailor on shore leave one of government’s most crucial agencies seems to be out of control and stumbling from one issue to the next with complete disregard for science, protocol or the future of our most important profession.