Another Ethanol Myth Bites the Dust

In General by Chuck

Does the nation value wildlife and environmental protection more than ethanol and meat producers? So asked an article in the New Orleans Times-Picayune on Sunday.

A continuing claim of the anti-ethanol bunch is that the pressure to grow more corn for food and fuel would lead to using environmentally fragile land for crops. They point to the 36 million acres in the federal Conservation Reserve Program as an easy target.

So far, it’s not happening.

Last spring, as crop prices climbed, the Department of Agriculture surveyed growers whose CRP contracts were set to expire over the next three years. They asked whether the growers intended to re-enroll their land or put it back into production. “The percentage of landowners choosing to remain in CRP is consistent with what we have seen in the past, despite speculation that re-enrollment would drop significantly due to high corn prices,” the department said.

On Friday. Acting Agriculture Secretary Chuck Conner announced there will be no early release from current CRP contracts. “The potential exists for increased double-cropping and the planting of fallow ground,” Conner explained in a news release. “Overall, I expect that market signals will continue to provide adequate acres…”

In other words, both growers and the secretary believe there’s enough land in production to continue to meet the need for food and fuel – just as farmers have said all along. Farmers know better than to sacrifice environmentally sensitive land for a quick profit.

Too bad the Times-Picayune isn’t reporting that. Instead the paper has chosen to focus on the Conner’s statement earlier last week that he was considering early release from CRP contracts. Over the years growers have shown an amazing talent for continuing to produce more on fewer acres. This year was no exception. Next year, they’ll be challenged again, and we’re confident they’ll continue to meet the challenge.

Ethanol is Product of the Year

In Ethanol by Chuck

Agrimarketing Magazine In a near unanimous decision, ethanol has been chosen as the 2007 AgriMarketing Product of the Year by AgriMarketing Magazine.

According to the magazine, the entry was submitted by the Ethanol Promotion and Information Council (EPIC).

In just the past year, ethanol production has increased over 50%, given several segments of the ag economy a much needed boost, and increased household income by $6 billion.

The combined Nov/Dec issue of AgriMarketing magazine will feature a special supplement about ethanol and its impact on North American agriculture and agribusiness.

Wouldn’t We All Like a New Farm Bill?

In Farm Bill, Legislation by Chuck

As was pretty much expected the Senate didn’t get a farm bill passed before the 2002 Farm Bill expired yesterday. They’ve got some more work to do apparently. Go to the Senate Ag Committee homepage and there’s not a word about it. Of course their “Today in Agriculture” section is showing as its latest item one that’s dated July 2. That might tell you something.

A coalition of groups, including the NCGA, has sent the Senate a letter asking them to get the job done.

The groups ranged from farm commodity groups such as NCGA to conservation groups, hunger relief organizations, such as School Nutrition Association, and faith-based action groups. In addition to agricultural programs, the farm bill also authorizes and funds a number of conservation and nutrition programs.
“While our organizations have differences on specific policy recommendations,” the letter noted, “we believe it is vitally important that the Senate Agriculture Committee mark up and pass a 2007 Farm Bill as soon as possible.”

You can read the full letter here (pdf).

Big Oil Stalling Drive to Ethanol

In Ethanol by Cindy

This may not come as news to those of us close to the ethanol industry, but it is amazing to see a major business publication take the oil industry to task for fighting E85.

Business WeekAn October 1 article in Business Week entitled the “Big Oil’s Big Stall On Ethanol” claims that oil companies “seem determined to fight the spread of E85, a fuel that is 85% ethanol and 15% gas.”

At the same time the industry is collecting a 51 cents-per-gallon federal subsidy for each gallon of ethanol it mixes with gas and sells as E10 (10% ethanol and 90% gas), it’s working against the E85 blend with tactics both overt and stealthy. Efforts range from funding studies that bash the spread of ethanol for driving up the price of corn, and therefore some food, to not supporting E85 pumps at gas stations. The tactics infuriate a growing chorus of critics, from the usual suspects—pro-ethanol consumer groups—to the unexpected: the oil industry’s oft-time ally, the auto industry.

This is a very interesting article that makes many of the points the ethanol industry has been saying for months now. There is also a comments section for it – provide some feedback!

Why WRDA?

In Current News, Policy, State Groups by Cindy

Despite a looming veto threat, the U.S. Senate overwhelmingly passed the Water Resources Development Act (WRDA) conference report Monday evening by a vote of 81-12, making a WRDA victory within grasp.

National Corn Growers Association (NCGA)
President Ken McCauley says “It’s unfortunate the administration is threatening veto. Our infrastructure cannot keep pace with demands and is falling apart. We must upgrade the lock system on the Upper Mississippi and Illinois rivers to compete in the global market place. Our hope is the president will take seriously his responsibility to ensure our nation has a safe and viable infrastructure by signing WRDA into law. Ignoring that responsibility is a dangerous gamble.”

Miss River LockNCGA says a presidential veto will only delay passage of the bill as there is strong congressional support for WRDA and a veto override is likely.

Corn growers nationwide have been long-time advocates for improvements to our inland system. WRDA provides authorization for seven 1,200 foot locks on the Upper Mississippi and Illinois rivers. WRDA is crucial to farmers who depend on the inland waterway system to deliver their crops to the global marketplace and to businesses who rely on the system to move their raw materials and products.

According to Missouri Corn Growers Association president Mike Geske, “The Mississippi River transportation system is key to both exports and imports. We need access to grain and livestock markets around the world, but our cities and towns also need the ability to import basic commodities like steel, building materials and petroleum products.”

It is estimated that 60 percent of U.S. grain exports are transported via the Mississippi River. The construction of seven new locks will help speed barge traffic, allowing farmers and businesses greater access to global markets.

“Countries around the world are upgrading their transportation systems to compete in the international marketplace,” summarizes Geske. “Without these upgrades, the U.S. will not be able to maintain a competitive edge with markets across the globe.”

Ethanol Keeps Gas Prices Down

In Current News, Ethanol by Cindy

RFARising gas prices have made headlines this year, but those prices could have been much worse if not for ethanol.

The Renewable Fuels Association sent out a media FYI release drawing attention to that fact, which is backed up by recent news reports.

Two recent news articles in The Wall Street Journal and the Dallas Morning News cited petroleum industry analysts who pointed to lower priced ethanol as one major factor in restraining gasoline prices nationwide.

While tight refining capacity and higher world crude prices are helping to push the price of gasoline higher, ethanol is working in the other direction. As a September 21, 2007 story in The Wall Street Journal put it,

Another reason for steady gasoline prices: the use of ethanol as an additive to gasoline is on the rise. While crude prices have soared, ethanol prices have dropped as much as 30% in recent months and are likely to drop more, Eitan Bernstein, an analyst with Friedman, Billings, Ramsey & Co., said in a report yesterday. Ethanol costs more than 60 cents a gallon less than gasoline, and gasoline suppliers can offset some of the rise in crude oil prices by blending their gasoline with small amounts of the cheaper fuel. (emphasis added)

Similarly, a story in the September 24, 2007 edition of The Dallas Morning News reported:

Peyton Feltus, president of Randolph Risk Management, thinks gasoline prices might even increase this year.

He said ethanol and bio diesel helped keep fuel prices stable since the summer. Blending ethanol into the fuel supply may have boosted pump prices in the past, but now, ethanol is cheaper than gasoline, and it’s keeping overall prices down. (emphasis added)

“You can thank renewables for doing that,” Mr. Feltus said.

NYT Blogger Hits Ethanol Again

In Ethanol by Cindy

Ladies and gentlemen, start your keyboards.

New York Times “Wheels” blogger Jerry Garrett has taken another swing against ethanol in today’s “Corn Ethanol – Biofuel or Biofraud?” using the recent OECD report as ammunition. But, unlike the tortilla post, comments on this one are running more anti-ethanol, so get your voices heard.

Garrett takes the position that basically the federal government is a) keeping us from buying cheaper and better sugarcane ethanol from Brazil and b) not funding any research into cellulosic ethanol.

He says, “why is America, in particular, insisting on making ethanol from the worst possible choice? It seems that our government’s only true interest in ethanol production lies in placating its agricultural lobby, which in turn is seeking to cash in on forced legislative mandates for domestic ethanol production.”

Grrrrrr!

Eliminate Body Odor With Corn

In New Products by Chuck

ZemeaWe think of using corn for all kinds of products these days but have you considered deodorant? The folks at Dupont and Tate & Lyle have.

The DuPont Tate & Lyle Bio Products joint venture today announced that it is providing its innovative Zemea(TM) renewably sourced propanediol (Bio-PDO(TM)) product to Terra Naturals Inc., a personal care company, that has developed a line of natural deodorants that are corn-based, aluminum- and petroleum-free. Under the branded GREEN line of products, the deodorants are distributed through United Natural Foods in the United States and Purity Life in Canada and also are available at the Terra Naturals website, www.terranaturals.com.

Zemea Body DeodorantZemea(TM) renewably sourced propanediol is a 100 percent renewably sourced ingredient made from corn sugar. The Terra Naturals GREEN line includes deodorant sticks, sprays and roll-ons for men, women, teens and sport uses. These products offer excellent odor elimination, excellent texture and a non- sticky residue. The GREEN line products are free of petroleum-based chemicals, free of synthetic parabens and aluminum and use only plant derived ingredients.

“We are seeing increasing demand for products made from renewable, corn-derived ingredients in the cosmetics and personal care markets,” Steve Mirshak, DuPont Tate & Lyle Bio Products president, said. “While the demand for renewable products is real, we know consumers don’t want to compromise on the performance of their deodorants. We are pleased to offer Zemea(TM) as an ingredient that has helped Terra Naturals deliver a high-performance line of deodorants that really work.”

EU Biofuels Perspective

In Audio, Ethanol, Food vs Fuel, Policy by Cindy

FlagsI have been traveling abroad for the past two weeks and getting an international perspective on biofuels which has been very interesting. I have been in Germany, Belgium and Japan and biofuels has been a topic everywhere.

In Brussels I was on a trip sponsored by BASF Ag Products with a group of ag journalists who had the privilege of meeting with the European Commission’s spokesman for agriculture and rural development Michael Mann. “Biofuels is now a major issue, of course,” he said. He discussed the Commission’s plans to have biofuels make up ten percent of transport fuels by the year 2020. “We’ve also set that some of that will have to come from imports and we will also favor in the long term second generation biofuels,” Mann said. “We don’t want too much of our agricultural land to be diverted away from food and feed production. So, its a balance between the importance of biofuels for environmental reasons and to lower our reliance on imported oil, but at the same time not upsetting our food and commodity markets too much.”

Michael MannAccording to Mann, the EU has incentives for rural development of biofuels refineries in place, which are actually grants. “Developing biofuels plants is something you can receive a grant for from rural development funding.” In addition, there is a tariff in place for ethanol imports to the EU and there are incentive payments for farmers to produce crops for biofuels production which was introduced in 2003. “If you have a contract with a biofuel producer to produce the raw materials for biofuel, you can get an extra 45 euros per hectare on that land.” Mann says they are reconsidering that incentive, in light of the OECD criticism of biofuels subsidies and also because there is now a market because the target is in place.

The EU is expected to eliminate its current mandatory 10 percent setaside for the next crop year to allow farmers to produce more for the market and Mann says that of the 3.8 million hectares currently set aside, they estimate about half will go back into production, much of it into corn.

So, Europe is facing some of the same issues we are in the US, which is very interesting. Here in Japan, where I am at a congress for international ag journalists, I am actually getting perspective from all over the world. More on that later.

Meanwhile, you can listen to all of Mann’s remarks about biofuels in the EU here:
Listen to MP3 Michael Mann (6:00 min mp3)

NCGA is “Growing For The Future”

In General by Chuck

NCGA has a new video out and you can watch it on YouTube. It focuses on the connection between the nation’s corn growers and the land they farm. (Part One, Part Two, Part Three)

Titled “Growing for the Future,” the story includes reminiscences from corn growers about the farming practices they grew up with, and how they’ve been able to take advantage of new technology to protect soil from the continuing threat of water and wind erosion, reduce agricultural inputs and improve the long-term health of their fields.

“This is an important step to communicate with people who may not have any first-hand knowledge about agriculture,” says NCGA President Ken McCauley. “With all the concern about the impact of agriculture on the environment, it’s vital for people to know the role agriculture has in protecting our environment.”

Corn growers from Colorado, Iowa, Kansas and Missouri speak from the heart about the challenges they faced in their environmental efforts. “We’re changing fertility, we’re changing the amount of water that we apply, we’re changing the tillage, we’re using variable rate technology for both insect control, disease control and also nutrient management,” noted agronomist Mike Petersen. “That’s huge!”

The video also brings out the link between growers and the land, making it clear that environmental responsibility is a part of their lives. “The soil has given back to us over the years,” concluded Byron Weathers, of Yuma, Colo. “If we take care of it, it will take care of us.”

The new video is part of a broader campaign by NCGA to provide factual information to the public about corn and the environment. The video is available for download on the NCGA Web site. The video runs approximately 10 minutes, and is viewable and in three sections. An NCGA “white paper” on sustainable agriculture (pdf) and smaller topic briefs are also available on the site.

You can watch part one of the video here: