Ethanol – More than Just a Fuel

In Ethanol, Research by Cindy

“Wouldn’t it be wonderful if we could take a product that’s currently produced by the petrochemicals industry and find a competitive peer for it—one that’s renewable, competitive and green?”

Ethyl LactateThe answer to that question, posed by National Corn Growers Association Vice President for Research and Business Development Richard Glass, should be a resounding “heck, yeah!”

This little molecule, Ethyl lactate, is a general all-purpose solvent as well as a common ingredient in pharmaceutical preparations, food additives and fragrances. It is typically derived from petrochemicals. However, using a reactive distillation process allows a cost-effective way to produce it from ethanol – hence providing a significant non-fuel revenue stream for ethanol plants. “If all you produce from a biorefinery is ethanol, that is fine for a nascent industry but, in essence, all you have is a one-trick pony,” Glass said. “My dream is the integrated biorefinery where the only limits are your imagination and the ability to make the system utilize all components of the production output.”

An article in Biomass magazine outlines some of the work being done by the NCGA and a team from Michigan State University. According to the article, ethyl lactate is not widely used today because of its high cost, but has applications in the electronics industry for micro-circuit fabrication, mainly because it’s a clean solvent. In 2007, the cost of producing ethyl lactate was between $1.30 and $1.60 a pound. MSU and NCGA researchers were able to cut that cost by half using a process called reactive distillation.

“Food Versus Fuel” Debate Dead

In Ethanol, Food Prices, Food vs Fuel by Ken

More and more, the food “versus” fuel debate is being proved for the lie it was. There never was a strong connection between ethanol demand and retail food prices. Here are a few more obituaries, if you will, for this discussion.

Sen. Charles Grassley to Grocery Manufacturers Association, via

“While food processors were willing and able to immediately blame ethanol and rising corn prices for having to increase retail food prices, they won’t be extending the same courtesy by lowering those prices with lower corn and oil prices.”

Biopact Web site:

“… those who blamed biofuels for pushing up prices of major grains made a problematic mistake. The more cautious (and often less noisy) experts – like the Wageningen University’s agrocommodity specialists – were correct, when they said biofuels played a ‘marginal’ role at best.”

And, yes, the Reuters story noted below.

Nothing further to see here, folks … let’s move along, please …



Illinois Corn Releases Ethanol Studies

In Ethanol, Farming, State Groups by Cindy

The Illinois Corn Growers Association has released two landmark studies which conclude that production of ethanol leaves a smaller carbon footprint than gasoline and has substantial room for growth without affecting corn supply to the food and feed sectors.

ICGA“The conclusions of these two scientific studies are historic,” said Rob Elliott, vice president of the ICGA. “Amid the long and sometimes heated debate between ethanol proponents and detractors, these studies indicate that modern ethanol plants have a superior carbon footprint and net energy benefit when compared to gasoline refineries,” Elliott said. “Equally significant are the findings of the two studies we are releasing today which indicate clearly the promise of modern ethanol technology. They should put to rest the myth that ethanol is less environmentally friendly than the manufacture of gasoline. They also provide a compelling argument that corn growers will be able to produce sufficient supply to meet food, feed and renewable fuel requirements over the next two decades.”

The studies’ authors were Ross Korves, economic policy analyst at ProExporter Network, and Dr. Steffen Mueller, principal research economist at the University of Illinois at Chicago’s Energy Resources Center. Both studies can be downloaded from ICGA here.

USDA Revises Crop Report

In Farming, government by Cindy

For the first time ever, USDA has revised and re-issued a monthly crop report. A new October acreage and production report was issued this morning.

NASSUSDA revised the numbers after discovering discrepancies in a Farm Service Agency (FSA) database of producer-reported crop acreage used by the National Agricultural Statistics Service (NASS). NASS published the changes this morning in a corrected version of the Oct. 10 Crop Production. The World Agricultural Outlook Board also issued an abbreviated World Agricultural Supply and Demand Estimates (WASDE) report reflecting the acreage updates.

Compared to the Oct. 10 release, the corrected Crop Production report reflects 1.2 percent fewer planted acres for corn, 1.4 percent fewer planted acres for soybeans, 1.9 percent fewer acres planted acres for canola, 0.8 percent fewer planted acres for sunflowers, and 0.7 percent fewer planted acres for dry edible beans. The report also reflects a 2.5 percent increase in planted acres for sorghum. Even with the reduced acreage estimates, the 2008 corn crop is still on track to be the second largest on record, while the soybean crop will be the fourth largest.

Schafer Clarifies USDA Loan Program

In Ethanol, government, Livestock by Cindy

USDA has been trying to get the message out that they are not bailing out ethanol plants that lost money speculating on commodity markets this year.

World Food Prize Ed SchaferThe problem started when Secretary of Agriculture Ed Schafer told members of the press at the World Food Prize symposium in Des Moines that some ethanol plants might be eligible for loans through USDA. “There is going to have to be some credit applied to companies to buy some lower-priced corn to blend with their higher-priced corn obligations,” Schafer said.

Reaction from the livestock industry was swift and angry. Eight major livestock organization leaders wrote to the secretary protesting what they viewed as preferential treatment for the ethanol plants. “Many of our producer and processor members also took long positions on corn and soybeans and are paying above-market rates right now,” they wrote. “We in animal agriculture are particularly concerned that you would consider adding one more level of support for the corn-based ethanol industry.”

So, Schafer met with those groups today to try and explain the USDA’s Business and Industry Loan Guarantee Program. “We walked through the B&I loan guarantee program, which has been used by their memberships, and we assured them that this was a long-standing program that we would use to help finance businesses in rural America, some of them may be ethanol facilities,” Schafer said.

Schafer notes that the loan program is there for the livestock industry as well. “And we’re going to pass along the elements of the Business and Industry loan guarantee program to them that they can pass out to their members.”

No word from the livestock industry on whether they would consider that a “bail out.”

South Dakota Corn Sponsors Ethanol Bowl

In Ethanol, State Groups by Cindy

South Dakota CornThe South Dakota Corn Utilization Council is partnering with Northern State University to present the First Annual Ethanol Bowl next month.

The premiere event will feature the NSU Wolves facing Northern Sun Intercollegiate Conference rivals the Augustana Vikings on November 8 at Clark Swisher Activities Complex in Aberdeen, S.D.

“Northern State looks forward to celebrating a growing industry in our region and enjoy some great NSIC football,” said Bob Olson, NSU Athletic Director.

Increased Demand for Ethanol By-Product

In Audio, Ethanol, Exports, Livestock by Cindy

US Grains Council Ken HobbieExport opportunities for the ethanol by-product distillers dried grains with solubles (DDGS) are increasing as the industry continues to grow. That was the main message to more than 500 who attended the second the U.S. Grains Council’s International Distillers Grains Conference this week in Indianapolis.

“The reason we’re holding this conference is that we are confident the U.S. ethanol industry will continue to grow due to efforts undertaken by the National Corn Growers Association and state producer organizations over the last several years,” said USGC president and CEO Ken Hobbie. “Due to the efforts of U.S. growers to establish the ethanol industry, we made DDGS our top priority in 2006 and since then have seen DDGS exports exceed 2 million metric tons annually.”

“DDGS and its value in all types of animal rations shows that US grain producers have the capacity and the capability to produce for both food and fuel.” Hobbie said. He noted that if the four million tons of DDGS exported from the US this year were divided equally between all the major livestock food sectors it would produce 331,000 metric tons of chicken, nearly five billion eggs, almost 86,000 metric tons of beef, 1.8 million metric tons of milk and 205,000 metric tons of pork.

Listen to Hobbie’s remarks here, provided by Hoosier Ag Today:

Will They Admit Their Error?

In General by Ken

From Reuters, today:

Ethanol no longer seen as big driver of food price

Heavy demand for corn from ethanol makers was seen as a key driver of corn futures to record highs in June, but since then the sharp decline of corn along with other commodities shows that belief was mistaken.

“The record high prices were a speculative bubble,” said Stewart Ramsey, senior economist for Global Insight, Philadelphia.

Duly Noted and Quoted

In Ethanol, Food Prices by Ken

Back in August, when the U.S. Environmental Protection Agency upheld the renewable fuels standard, ethanol critics were disappointed. Scott Faber, the Grocery Manufacturers Association, was quoted saying that the Bush Administration lost a chance “to immediately reduce food prices and, more importantly, to avoid the certainty of much higher food prices in 2009.”

How immediate would that reduction in food prices have been? Faber never said, and now we know why. As much as corn prices have decreased since reaching a peak in August, there seems to be no intention to lower prices. Here’s another quote from Faber, from an Oct. 17 Wall Street Journal story that looks into how food prices are remaining high, despite much lower prices for commodities suich as corn, soybeans and wheat: “The impact of [higher priced] corn is continuing to work its way through the value chain and will continue to be reflected in higher grocery prices for some period.”

If anything gets reduced, it’s the size of food packages in grocery stores, as noted in a post below.

Feeding and Fueling the World

In Farming, General, International by Cindy

World Food Prize Ed SchaferThe answer to feeding a growing world population lies with building on the success of the American farmer, according to Agriculture Secretary Ed Schafer, who addressed the World Food Prize breakfast last week in Des Moines.

“Our focus should be on sharing our technology, equipment and know-how, processes and procedures to help farmers all over the world boost the productivity of their land,” Schafer said. “Just in the last 15 years, our corn yields have increased from an average of 100 bushels per acre to 150 bushels per acre, a 50 percent increase in yield in 15 years.”

“Gains of this kind have allowed the United States producers to meet the rising demand for food and feed and fuel, while maintaining record level exports and strong food aid donations,” Schafer added.

Listen to Schafer’s comments regarding productivity here: