Ethanol

Water Problems Creep Across the U.S.

Fri, 20 Nov 2020 05:31:41 GMT

More than ever, water is the tension bar between agriculture and society. Urban centers desperately need more of it to satisfy an increasing population. Farmers require it to produce the food for all those people.

With the Earth’s water supply finite but demands for it ever escalating, conflicts about water are becoming commonplace. Farm Journal is committed to covering agriculture’s role in this clash. The story below about water problems on farms in eastern Colorado is the first in what will be an ongoing series that promises to touch every corner of the nation.

Caught in a devastating three-year drought, state and federal water agencies in California say they will cut deliveries to farmers in much of the San Joaquin Valley by at least 85% this year. That will idle land and result in 40,000 lost jobs and $1.5 billion in income, says Richard Howitt, chair of the Agriculture and Resource Economics Department at University of California–Davis. In addition, the nation’s food security could be compromised because that region produces half our fruits, nuts and vegetables, along with other crops, such as cotton, wheat and potatoes.

(Farm Journal)

The Ogallala Aquifer, which supports millions of acres of crops in eight Plains states, continues to decline. From the late 1940s, when farmers began irrigating in the Texas Panhandle, until 1980, portions of the aquifer dropped 100' and will fall another 100' by 2020, says Jim Goeke, University of Nebraska hydrogeologist. In Nebraska, the Department of Natural Resources recently issued a preliminary ruling that the Lower Platte River Basin appears “fully appropriated.” That could lead to a moratorium on new irrigation wells.

Texas, now in the midst of a long-term drought killing both crops and cattle, faces big problems. Nearly the entire state is in some stage of drought, according to the most recent U.S. Drought Monitor maps. A new report by Susan Combs, Texas state comptroller, projects the state’s popu-lation will double to more than 46 million by 2060, boosting water demand by about 27%. The water shortage could cost Texans about $9 billion next year and more than $98 billion by 2060, the report says. Combs calls for new water management strategies to deal with the crisis.

The Southeast, after several dry years, is no longer assured of consistent rainfall. That puts the city of Atlanta and its fast-growing suburbs in conflict with farmers as well as surrounding states. Even oystermen on Florida’s Gulf Coast complained as fresh water supply dwindled in Apalachicola Bay, which produces 90% of the state’s renowned oysters. In February, Georgia’s Gov. Sonny Perdue appointed 300 people, including farmers, to 10 regional water planning boards to monitor the situation.

Shortage of water isn’t the only difficulty facing agriculture. Quality is an issue in many watersheds and streams across the country. North Carolinians, among others, deal with ongoing battles regarding hog lagoons. Farmers in the Chesapeake Bay watershed have had to change management practices to rehabilitate its water, long important for fishing and recreation. Florida’s farmers and ranchers are dealing with stringent environmental regulations designed to protect sensitive wildlife habitat. In many other areas, farmers and ranchers are devising ways to protect watersheds and lakes with innovative fencing for livestock and conservation tillage for crops.

With our new series, we at Farm Journal will not only outline the problems but pledge to also look for answers that can help farmers and ranchers overcome this threat to their livelihoods and legacies. Technology already offers some possibilities: irrigation refinements that reduce water usage and drought-tolerant hybrids, to name just two.

Water is the overriding concern for farmers, ranchers and society as a whole. Without workable solutions, everyone loses. Share your thoughts and let us know about water
issues in your area. We want to hear from you.

Colorado’s Water War

For Darrell and Cindy Johnston, 2002 was the turning point. The worst drought in memory shattered hopes of a profit on their farm in Erie, Colo.

“We didn’t get any moisture. Snowpack was way down. We planted bone-dry. Crops sat waiting for rain. Water was allo-cated, and we had to decide which crops to irrigate. We burned our water up getting the crop up, then we were out of water. So we didn’t have a crop,” Darrell says.

The future didn’t look much better, either. Located on the Front Range just north of the Denver metropolitan area near I-25, with water supply both short and at a premium due to booming development, the Johnstons decided moving was their best option.

“When the drought hit, farms went from irrigated to dryland overnight. The problem in Erie is that the cities have control of the water and dictate how much we get. It’s been going on for 10 years now,” Darrell says.

(Farm Journal)

Though they had both grown up in the area, the Johnstons sold some of their more valuable land near the interstate. They bought land with a more assured water supply 70 miles away in Fort Morgan, Colo., using an Internal Revenue Service Section 1031 Exchange to postpone capital gains taxes. They grow corn and sugar beets on the 700 acres in Fort Morgan and wheat, barley and hay crops requiring less water on the original 2,700-acre farm, which is now managed by their 23-year-old son, Brandon.

“Buying land in Fort Morgan is the hardest decision we ever made. But if we’re going to farm, we have to have water. When the 2002 drought hit, it was eye-opening to know we did not have water to irrigate,” Cindy says.

Lots of other Colorado farmers are seeing their worlds rocked in much the same fashion. In addition to the competition for water with cities on the Front Range, eastern Colorado farmers in the Republican River Basin and the South Platte River Basin have their own serious problems.

Four hundred irrigation wells in the Republican River Basin were recently shut down to comply with a settlement involving a Kansas lawsuit that requires certain flow levels. In the South Platte River Basin, pumping from as many as 4,000 wells has been limited or curtailed due to a plan to recharge the river’s water and comply with the Endangered Species Act, says James Pritchett, a Colorado State University ag economist working on water issues.

“Crop acreage has gone from 3 million to 2½ million. We’re likely to lose 250,000 acres in the South Platte, where we’re at 1 million acres now,” Pritchett says. “We’ve been depleting the aquifer at an unsustainable rate. Within one generation, we’ll have to find a way to continue agriculture in that area with less water.”

So far, farmers losing wells have gotten little compensation. “On the South Platte, they are not compensated. They are literally high and dry. On the Republican, these are voluntary measures through CREP [Conservation Reserve Enhancement Program] and EQIP [Environmental Quality Incentives Program], a token compensation nowhere close to what they could make from full production,” says Mark Sponsler, executive director of the Colorado Corn Growers Association.

Those economics won’t pencil out long-term for farmers caught in the 21st century water wars. The Johnstons enjoy farming their new Fort Morgan land but warily eye what’s happening to other producers.

“I just cannot comprehend that government can say, ‘Sorry, you’re done, too bad.’ A judge held the fate of all those people’s lives,” Cindy says.

You can e-mail Charles Johnson at cjohnson@farmjournal.com .

A Whole New Twist

Fri, 20 Nov 2020 02:51:27 GMT

A California ethanol plant and a dairy team up to build a methane digester

When officials from a nearby ethanol plant approached him last year about a methane digester project, dairy producer Frank Junio was skeptical.

“My first thought was, ‘Why would I want to get hooked up with them?’” recalls Junio, who milks 1,600 Jerseys at his family’s dairy near Pixley, Calif.

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Calgren Renewable Fuels could cite a couple of good reasons. The plant wanted the biomethane from Junio’s dairy manure to help power its ethanol-making operation. Located less than a mile north of the Junios’ Four-J Dairy, Calgren proposed building an underground pipeline to transport raw manure to a digester it would construct on its ethanol-producing site. Would Four-J be interested in a new manure management infrastructure and dried solids for freestall bedding, at no cost?

Junio’s hesitation wasn’t so much that the ethanol industry had become something of a villain to livestock producers, who blame soaring feed prices on ethanol’s growing demand for corn. The issue was more pragmatic for the third-generation dairy producer. “A lot of ethanol plants were going out of business in the Midwest,” Junio says. “It didn’t seem like the right thing for us to do.”

But for Calgren and project manager Daryl Maas, the Pixley biogas project made total sense. “I wouldn’t be here if I didn’t think this would work,” says Maas, whose Farm Power Northwest company owns five dairy digesters in Washington and Oregon.

“The biogas industry has been plagued by delusions of grandeur,” acknowledges Maas. “But this is a good, practical project. It involves neighbors who are working together with knowledgeable people. They’re taking on a project of manageable size that provides a direct benefit for both the dairy and the ethanol plant.”

Junio’s doubts eased after meeting with Maas and Calgren’s president, Lyle Schlyer. “Lyle assured us they are here for the long haul,” he says.

The dairy producer now sees the project as “a big plus for us.”

Calgren first fired up its ethanol plant in 2008. One of California’s three operational ethanol plants, it produces 58 million gallons of ethanol a year, as well as wet distillers’ grains and corn oil. Nearly all of the plant’s corn comes from the Midwest.

From the beginning, Calgren saw opportunity in powering its plant with biomethane, not just fossil-fuel based natural gas. The company wanted to reduce its pollutant emissions and meet new federal guidelines under the Renewable Fuels Standard. And it sat in Tulare County, one of the nation’s top dairy areas. “If we could substitute a waste product to power our plant, we would make a more environmentally friendly ethanol product,” Schlyer says.

Calgren had another need. Because it generates its own electricity and steam, it produces hot stack gases and ends up with excess heat. That heat surplus could keep a methane digester at consistently high temperatures—perfect for the anaerobic process and producing methane. “We would improve efficiency and consume less fuel,” Schyler says.

The company turned to Maas, who helped write a grant proposal for the digester-pipeline project. In April 2010, the California Energy Commission awarded Calgren a $4.68 million matching grant to pay for half of the project.

Calgren is still deep in the permitting process for the project, which operates under the name Pixley Biogas Company. It hopes to begin construction by early next spring. Under Maas’ direction, the company will install a GHD-modified, plug-flow digester system about 100 yards north of the ethanol plant, which sits beside busy Freeway 99. Schlyer hopes the biomethane will reduce the plant’s natural gas usage by 8%.

At Junio’s dairy, raw manure will no longer flow into a lagoon. Instead, it will enter an underground pipeline and head to the digester. Junio will receive a valuable digester byproduct: pathogen-free manure solids, known as biofibers, which he’ll use as bedding in his freestalls. Another benefit will be the digester’s liquid wastewater, returned to the Junios via pipeline. They’ll apply that to their 800 acres of crops.

Beyond those benefits, Junio sees expansion possibilities. “We need this new infrastructure to allow us to expand and build a new milk barn,” he says. “Because it will be environmentally correct, we think it can help us get permitted to do that.

“If this all comes to fruition, it will mean $500,000 to $1 million in benefits for us,” adds Junio, who’s signed a long-term contract with Calgren. “Nothing’s a sure thing. Technology could change, something could happen. But it’s all positive at this point.”

Local Opposition Slows the Project

Calgren’s methane digester pipeline project with Frank Junio’s dairy is a scaled-down version of an earlier plan. Originally, Calgren wanted a bigger digester. The ethanol company planned to supplement the manure it received from the dairy with waste trucked in from dairies in a two-mile radius.

“It was the county planning staff’s position that the digester at that location would meet all relevant local codes and ordinances, and we recommended approval of the project,” says Benjamin Kimball, chief planner for Tulare County.

But opposition from local residents, farms, businesses and the Pixley town council over perceived transportation and odor issues, as well as a sense that the public had not been adequately informed about the project, forced a change in plans.

“We’re not looking for a fight,” says Calgren’s president, Lyle Schyler.

To appease those concerns, Calgren downsized the project to 60% of its original size. The revised plans include a smaller digester, supplied by the manure and liquid from Junio’s dairy alone. Kimball believes Tulare County’s Planning Commission and Board of Supervisors will eventually approve the project.

“The scaled-down project will be easier to achieve,” says project manager Daryl Maas. “We’re eager to get it going.”

Gas to Gas: Dairy Manure Powers California Ethanol Plant

Fri, 20 Nov 2020 02:51:50 GMT

In a first for the Golden State, a dairy, a digester and an ethanol plant partner to create renewable energy.

California’s first biogas project connecting a dairy to an ethanol plant officially crossed the finish line last week with a public inauguration at its San Joaquin Valley site.

Nearly six years in the making, the $9.5 million renewable energy project relies on manure piped from a dairy a mile away to an anaerobic digester at the Calgren Renewable Fuels ethanol production facility in Pixley, Calif.

Calgren’s digester captures manure-generated methane gas and burns it as clean biogas to power the ethanol plant. In turn, the plant yields nearly 60 million gallons of ethanol a year that, blended with gasoline, creates a low-carbon fuel for many of California’s 27 million cars.

Officials said the Pixley biogas project is the first California digester to use agricultural waste to create renewable natural gas to power another renewable energy facility. It’s also the first digester in the Golden State to be 100% American made and constructed. The plant now becomes California’s lowest-carbon commercial ethanol producer.

“This project is a model for biorefineries in California and throughout the U.S.,” Jim Mckinney, program manager for the California Energy Commission , said at the digester’s Feb. 10 grand opening. The state agency contributed $4.6 million in grant funds to the project.

The project produces several benefits, officials said.

(Farm Journal)

The dried manure solids that are discharged at the back end of the digester cycle are trucked back to Four-J Dairy every day to be used as bedding for the herd.

“We turn waste into fuel,” said Calgren Renewable Fuels president Lyle Schyler, adding that ethanol comprises 10% of fuel at California’s gasoline pumps. Moreover, the project’s carbon output “is quite low,” because of the digester and other emission-controlling equipment at the plant. “This project is exceptionally green,” Schlyer said.

“Electricity and hydrogen are getting a lot of media attention these days as the fuels of the future,” said Mckinney. “But it is the workhorse plants like this Calgren facility that reduce the carbon content of our fuel supply. At 58 million gallons per year, that’s enough low-carbon fuel for 145,000 cars every year.”

The new biogas system will reduce the amount of natural gas used to fire Calgren’s boilers by 6% and reduce the carbon footprint of the plant’s fuel product by 67 grams of carbon per megajoule, added Mckinney. “That’s one third less carbon than gasoline and one third less carbon than most of the corn ethanol from the Midwest that we import,” he said.

The project’s benefits don’t stop with Calgren and the California environment. Frank Junio and his family also have profited from the project. It’s their Four-J Dairy that’s supplying the manure to Calgren’s plant .

For their role in providing the manure, the Junios got a new manure management infrastructure for their 1,800-cow dairy operation. That includes a double-lined lagoon.

(Farm Journal)

Frank Junio’s dairy supplies the manure to the ethanol plant, seen in the distance.

The dairy also gets the dried manure solids that are discharged at the back end of the digester cycle. Those manure solids are trucked daily from the Calgren plant to Four-J Dairy, where they’re used as bedding for the Junios’ dairy herd. The digester’s remaining effluent is piped back to the dairy each day to be applied to field crops.

The Pixley biogas digester is a two-stage, plug-flow complete mix system. It has a 1-million gallon capacity, said Steve Dvorak, whose Wisconsin-based DVO company engineered the digester. (Calgren’s Daryl Maas conceived and guided the project; Regenis built the digester.) While 90% of the waste going into the digester comes from the dairy, the digester has received permitting to use all feed stocks, including municipal waste and food processing waste.

Located 12 miles south of Tulare and adjacent to Freeway 99, the Calgren facility was built in 2008. It’s one of only four commercial ethanol production plants in California. Corn feed stock for Calgren’s plant arrives by train from the Midwest at the neighboring JD Heiskell facility . It’s then transferred via elevators and conveyors to Calgren’s plant for processing. In addition to ethanol, the Calgren plant produces wet distillers grains and corn oil.

The Next Generation of Bioplastics

Fri, 13 Nov 2020 05:59:45 GMT

Corn might give the plastics industry a makeover

Bioplastics and biochemicals made from the sugar and sometimes protein of corn, soybeans and other crops will likely never replace ethanol as one of corn’s key markets. However, they will be a growing market for corn and other field crops if manufacturers can produce them cheap enough to compete with petroleum-based plastics.

“Ethanol has had a massive impact on the corn market but only a minor impact on the fuel market,” says Olly Peoples, co-founder and chief science officer for Metabolix, a bioscience company that produces biochemicals and resins to make bioplastics from crops. By contrast, bioplastics and biochemicals have the potential to make a major impact on the plastic and chemical industries.

The ethanol industry produces 14 billion gallons of biofuel, which is equivalent to about 190 million tons of corn sugar, Peoples says. From that, bioscience companies such as Metabolix could produce 90 million tons of biochemicals, which is a year’s worth of U.S. demand for the equivalent convention of chemicals.

“Compostable plastics make sense only if you have a compostable infrastructure.” — Frederic Scheer, founder and CEO of Cereplast

The bioplastics industry is even larger. Bioplastics can be made from PHA (Polyhydroxyalkanoates) and PLA (polylactide) resins. PLA plastics are hard and rigid and won’t degrade unless they are sent to a municipal compost facility where temperature and composting time are controlled. PHA plastics are flexible, marine degradable and compostable.

Recent research could expand the market for these and other bio-based products. “We’ve been testing a plastic that is half PLA and half soy protein,” says David Grewell, an Iowa State University researcher. “If put it in the ground, it acts like a fertilizer.”

Garden pots are one application for this plastic; the pots can be used to grow the plants. When the plants are ready to be put into the ground, they are removed from the pots, and the pots are placed into the garden near the plants’ roots.

Double Duty. “A few months later, the pot has biodegraded and the plant is fertilized,” Grewell says.

The self-fertilization feature of these pots is due to the fact that they are made partially using soy proteins. Corn proteins can also be used to produce these bio-pots, which are not yet commercially available.

“We’ve been studying these pots for several years,” Grewell says. “From vegetables to flowers, plants grown in these pots are larger, healthier and nicer looking than plants grown conventionally.”

Metabolix technology is also used in a biodegradable soil wrap that looks like a plant pot. “You just stick it in the ground along with the plant,” Peoples says. Within a couple of months, these pots have fully degraded. Unlike Grewell’s pots, Metabolix pots are made from corn sugars and are not self-fertilizing, but they are commercially available.

Currently, the ethanol industry produces

14 billion gallons of biofuel, which is the equivalent of about
190 million tons of corn sugar. From that amount of sugar, bioscience companies could produce
90 million tons of biochemicals, enough to fulfill an entire year’s worth of U.S. demand for the equivalent convention of chemicals.

Compared to that of petroleum-based plastics, the bioplastics manufacturing process produces fewer greenhouse-gas emissions. Also, bioplastics don’t contain bisphenol A (BPA), which supposedly can disrupt hormones in humans.

However, PHA bioplastics need to be composted. PLA bioplastics can be industrially composted and sometimes recycled, but recycling and composting remain controversial.

Parts of Europe have a composting infrastructure, and like recycling, the U.S. infrastructure is not uniform. Areas with composting include parts of the West Coast, such as Seattle and San Francisco, and states such as Minnesota, Oregon, Pennsylvania and parts of New England.

“Compostable plastics make sense only if you have a compostable infrastructure in place,” says Frederic Scheer, founder and CEO of Cereplast, a bioscience company headquartered in El Segundo, Calif. “EPA is pushing for it, but it will take time to build.”

Corn Everywhere. NatureWorks LLC, which is based in Blair, Neb., and jointly owned by Cargill and Thailand’s PTT Global Chemical, produces Ingeo PLA resins used in deli food containers, food-service ware, textiles, baby wipes and a range of durable products. The company has the capacity to produce 140,000 tons of PLA resins a year, says Steve Davies, NatureWorks spokesperson.

“It takes the starch from 2.7 tons of corn to produce one ton of Ingeo resins,” Davies says. “However, when our bioplastics facility is operating at full capacity, it only aligns with the starch from less than 0.2% of annual U.S. corn production, or less than 0.05% of global corn production. The corn oil, gluten feed and gluten meal markets for that 0.05% of the global corn crop remain unaffected.”

Metabolix resins are used in a variety of products, including gift cards and pens, but the largest application is industrial compost bags sold in Europe. Metabolix produces and sells PHA resin pellets, called Mirel technology, to companies that turn them into compost bags. Mirel resins can be processed on the same equipment used to make petroleum-based plastics.

“Mirel is the fastest degrading bioplastic on the market,” Peoples says. “It degrades within about 30 days in soil and 60 days if the bag ends up in the ocean. Its ability to degrade in the ocean
is important due to the plastic pollution in the oceans.”

Prevent Pollution. In time, petroleum-based plastics photo-degrade with sunlight, breaking into smaller and smaller pieces. These particles remain suspended at or just below the surface of saltwater and become trapped by currents. The largest area where marine plastic pollution has accumulated is called the great Pacific garbage patch, and by some estimates, it covers 270,000 to more than 15 million square miles.

PHA products cost twice what petroleum-based products cost, and PLA plastics are 5% to 20% more expensive (depending on whether they’re compared with conventional plastics such as polystyrene, polyethylene terephthalate or PETE).

Cereplast’s Scheer explains that as the price of crude oil increases, bioplastics will become more cost competitive. As technology improves and the density of bioplastics declines, he says, they will be able to better compete with petro-based plastics.

Cereplast makes compostable and sustainable bio-based plastic products from corn, tapioca,
rice and bamboo. The company’s compostable resins are used to make single-use disposables and packaging including cups, straws, cutlery and bags, while its sustainable resins can replace as much as 95% of the petroleum in conventional plastics.

These durable plastics are used in consumer and electronic goods, as well as by the automotive, medical and construction industries.

Peoples says global demand for bioplastics is growing at about 20% a year. “People have been talking about bioplastics for the past couple of decades, but interest has increased substantially during the past couple of years now that there is a growing suite of materials available,” he adds.

In 2010, global production capacity of bioplastics was 724,000 tons, which is equivalent to 1.96 million tons of corn, according to European Bioplastics, an organization that represents members from the agricultural feedstock, chemical and plastics industries, as well as industrial users and recycling companies. By 2015, global capacity is expected to reach 1.7 million tons, which is equivalent to 4.59 million tons of corn.

According to USDA’s latest supply and demand estimates, global corn production for the current crop year will exceed 880 million tons.

“Companies producing bioplastics and biochemicals need to find the right niche for their products and they need to be cost competitive,” Grewall says. “If they are not cost competitive, bioplastics will always be a niche market.

Peoples’ Metabolix also produces biochemicals C-3 and C-4, which is a $10 billion global market.

Infinite Possibility. Multinational companies such as Coca-Cola, Frito-Lay, Danone and others have embraced bioplastics, says Davies of NatureWorks.

“How much of the plastics market can bioplastics take? With the big players interested in bio-based plastics and equally interested in seeing their products recycled or composted, the size of the bioplastics market is really the size of the plastics market,” he says.

For more information about the bioplastics industry and how it might compete with ethanol, visit www.TopProducer-Online.com/bioplastics .

This bag of chips is packaged in a low-carbon-footprint bag using Ingeo resins. Photo: NatureWorks LLC

U.S. Corn and DDGS Exports

Fri, 13 Nov 2020 06:00:41 GMT

Export to China is having an impact on U.S. corn and DDGS markets.
By: Kim Dillivan, Crops Business Management Field Specialist, SDSU Extension

For decades, international markets have been an important destination for U.S. agriculture products. While the potential for U.S. producers to export excess production primarily depends on economic factors affecting supply and demand, world geopolitical events also impact international trade. During the past year, decisions made by China and Russia have potential to negatively impact trade with the U.S. In China, authorities have begun enforcement of a zero tolerance policy in regard to the biotech trait MIR 162. This action led to an ongoing disruption of U.S. corn shipments to China. Russia, in response to sanctions imposed because of their alleged military involvement in Ukraine, has initiated trade embargoes targeting agricultural products originating from Europe and the U.S. While most U.S. corn is consumed domestically (becoming feed for livestock or is used to produce ethanol), foreign markets represent an important source of demand for U.S. corn and distiller’s dried grains with solubles (DDGS).

U.S. Corn Exports to China
For almost a year, China has rejected U.S. shipments of corn allegedly containing traces of an unapproved genetic material called MIR 162. Used to combat various insect pests that attack corn plants, MIR 162 was detected by Chinese officials in corn shipments from the U.S. in late 2013. Corn containing MIR 162 has been approved for production in various countries such as the U.S., Argentina, and Brazil. And despite approval from other major corn import markets, such as the EU, the material has not been approved by China. (Approval has been pending in China for more than four years and during that period China has consistently imported corn containing the trait.) However, in November 2013, China began rejecting shipments of U.S. corn and by January 2014 corn exports to China had essentially fallen to zero (Figure 1).

Figure 1. Monthly U.S. Corn Exports

Source: USDA FAS

U.S. Corn Exports to World
While U.S. corn exports to China were ending, other countries began to increase their purchases of U.S. corn. For example, quantities of U.S. corn shipped to Japan and South Korea have grown dramatically since January (Figure 1). Mexico also remains a reliable destination for U.S. corn.

Compared to marketing year 2012-13, many countries that import U.S. corn have significantly increased their purchases (Table 1), likely in response to a falling U.S. corn price. USDA estimates U.S. average corn price for the 2013-14 marketing year to be approximately $4.45 per bushel, compared to $6.89 per bushel for 2012-13.

For the past two years, Russia has not been a significant importer of U.S. corn. For example, from September 2013 to June 2014, Russia imported only 4,742 metric tons of U.S. corn. One year earlier, corn exports from the U.S. to Russia were slightly higher at 5,906 metric tons. Russia does not import any DDGS from the U.S.

According to USDA, U.S. agricultural exports to Russia totaled $1.31 billion in 2013 (only 0.8% of total U.S. exports value). Russia’s self-imposed 1-year ban on food imports from the U.S. will primarily affect poultry meat, tree nuts, prepared foods, and fish products. USDA anticipates Russia’s share of U.S. agricultural exports to fall to approximately 0.3% by 2015 (value basis). Although Russia has recently imported significant amounts of soybeans and live cattle from the U.S., these products do not appear to be on Russia’s list of banned agricultural items, therefore trade of these products is expected to continue without interruption.

U.S. DDGS Exports to China
The U.S. Grains Council is requesting that China approve the biotech trait MIR 162. The request comes after China announced that certificates are now required from point-of-origin exporters, such as the U.S., that guarantee DDGS shipments are free of that particular genetically-modified material. According to the U.S. Grains Council, no U.S. government agency has authority to issue these certificates. Although Chinese officials have begun requesting these certificates from the U.S. government, the disruption in corn trade between China and the U.S. has apparently not spilled over into DDGS markets. As a result, China remains the primary market for U.S. DDGS exports (Figure 2). However, China’s announcement places current shipments and future sales of DDGS in jeopardy. It remains unclear whether any shipments of DDGS to China have been affected since the beginning of September.

Figure 2. Monthly U.S. DDGS Exports

Source: USDA FAS

U.S. DDGS Exports to World
Like corn, U.S. DDGS prices have fallen in the past two years. For example, the price per metric ton for Gulf DDGS fell from $360 in August 2012 to $180 in August 2014. As a result, many countries that import U.S. DDGS have increased their purchases compared to the same period one year earlier (Table 2).

Outlook for U.S. Agricultural Exports
USDA predicts world economic growth to accelerate modestly in 2015, increasing from 2.7% in 2014 to 3.2% in 2015. If world economies improve overall, growing consumer incomes and spending will likely increase international demand for U.S. agricultural products. USDA also anticipates the U.S. dollar remaining weak but stable in 2014 and 2015. However, the dollar is expected to depreciate relative to many currencies in Asia, including currencies from some of our major trading partners. As a result, U.S. agricultural exports are expected to remain competitive into 2015.

Ethanol Producer Innovates Even as Ethanol Mandate Comes Under Fire

Fri, 13 Nov 2020 05:58:31 GMT

POET seeks to develop next-generation ethanol products even as controversy swirls

Wade Robey hears the critics calling for an end , or at least a respite, from the federal mandate that fuel makers buy ethanol. As senior vice president for technology of POET, one of the nation’s leading ethanol producers, he is sensitive to questions about the tremendous amounts of energy and water used to produce corn and ethanol.

Yet Robey steadfastly pushes his staff of 60 researchers to develop an exciting next generation of more efficient fuel products from biomass. Robey outlined many of the Sioux Falls, S.D.-based company’s advances at last week’s Future Farm Americas conference in San Francisco.

One of POET’s big new area of emphasis is cellulosic ethanol. The company plans to build one of the first commercial plants in the country in Emmetsburg, Iowa. ( DuPont earlier this year said it will start work on a cellulosic ethanol plant in Nevada, Iowa as well. And a major plant is expected to be operational in Italy later this year.)

Dubbed Project Liberty, the POET project will be a joint venture with Royal DSM, a $12 billion Dutch-based company. DSM is developing traits engineered to make it easier to break down cellulose from corn stover (the leaves, stalks and cobs of corn) and reduce the cost of applying enzymes.

The new facility , slated to begin operations at the end of 2013, will build on the success of a pilot plant POET opened in 2008 at its Scotland, S.D.-based research facility. POET has been working there with farmers to bale and transport residue left in fields after harvest.

“POET brought a basic technology to the table for the cellulosic facility. DSM is now coming in with the source of enzymes and fermentation yeast that will be dropped into the technology box that POET has developed,” Robey explained.

Robey believes cellulosic ethanol represents a huge opportunity. If the technology is deployed as planned at POET’s network of 27 existing corn ethanol plants, the company could produce up to 1 billion gallons of cellulosic ethanol per year. POET currently has the capacity to produce more than 1.6 billion gallons of ethanol, 9 million pounds of high-protein animal feed and thousands of pounds of bio-based oils and lubricants.

Federal law requires refiners and importers of gasoline and diesel fuel this year to use 500 million gallons of cellulosic ethanol in transportation fuel blends. That’s not going to happen. The Environmental Protection Agency estimates that just 8 million gallons of cellulosic ethanol will be produced in 2012, and it will largely come from demonstration and pilot plants. The agency has said it will adjust the mandate to reality.

Energy experts have touted the potential of cellulosic ethanol for years. It can be made from a variety of non-grain sources, including agricultural residue, grain sorghum, wheat, barley and potatoes. The process produces a clean-burning, high-octane fuel that is the same as ethanol made from corn.

POET, which wants to be the leader in cellulosic ethanol, is testing many of those raw materials. It hopes to produce cellulosic ethanol everywhere it makes corn ethanol. “We think the way going forward is to co-locate [production],” Robey said, noting that in that way the operations can share power and POET can optimize infrastructure investments.

Robey said POET’s new cellulosic plant will produce 25 million gallons a year, initially, and go from there. The plant already produces 55 million gallons of corn ethanol annually.

“POET hopes over the next decade to produce about 1 billion gallons of cellulosic ethanol, in addition to corn ethanol. We’ll do that by co-locating these facilities with our 27 other corn facilities around the Midwest. We then hope to license this technology to other providers in the industry,” creating an additional 1 billion gallons.

“Then lastly, we’re looking at processing other feed stocks—bagasse in Brazil, wheat straw in Europe, possibly grasses in the West—to produce another 1 billion gallons. So POET alone believes we can produce about 3 billion gallons of cellulosic ethanol over the course of the next 10 years through this process,” Robey said.

The federal government has set an ambitious goal of producing 16 billion gallons of cellulosic ethanol annually within 10 years.

POET researchers are also looking for ways to produce butanol from bio-mass. Butanol is produced with the same feedstocks as ethanol but with a different fermentation and distillation processes. “We think that’s a viable alternative. Our plants could be retrofitted easily....I could see us in the future having butanol production in some of our plants.”

The company continues to expand the products it produces from corn. Earlier this year, POET announced that, after a successful test launch, it is producing Voila corn oil -- an industrial oil derived from the enthanol process -- at 14 of its plants. POET is on a pace to produce 600 million gallons of Voila each year that could go into animal feed and bio- diesel production. With processing, Robey said, it could even be used for human food.

In addition to ethanol, the company produces a distiller’s dried grain (DDG) called Dakota Gold that is used as animal feed. It captures carbon dioxide at five of its plants for sale to beverage producers and other users. It pulls fiber from corn kernels for use in human dietary products. And it makes zein, a low-nutrient protein found in corn, for use in adhesives, binders, paints and shellacs.

POET maintains that while the ethanol industry uses 40% of the corn produced it this country, it returns much of that in the form of animal feed. Robey said that accounting for the DDG’s produced by ethanol producers, the industry really only uses 16% of the corn crop for ethanol.

Meanwhile, Robey and his staff of researchers and technicians are working to reduce the water and energy required to produce corn ethanol. In the last decade, ethanol producers have made dramatic strides in producing more ethanol from a bushel of corn, even as academics point out that a better measure would include the water and energy used to farm and transport corn.

“We lead the industry, at 2.9 to 2.95 gallons per bushel, because we have some proprietary technology,” said Robey. “But the whole industry has improved their yield of ethanol from a bushel of corn.”

Producers have also dramatically decreased the natural gas and water they use to produce ethanol, he said. POET consumes less than 2.5 gallons of water to process a gallon of ethanol by recovering it. “It takes 44 gallons of water to process a gallon of oil,” he said.

The size of the ethanol industry has tripled since 2005 and delivers 10% of the fuel into the gasoline market. Robey said that it reduces the price of gasoline by a dollar or more, depending on where you live. Under the Renewable Fuels Standard, U.S. fuel companies are required to blend 13.2 billion gallons of ethanol into gasoline in 2013, or about 10% of total gasoline usage, which requires converting some 40% of the U.S. corn crop into the biofuel.

“But there’s an obvious question that you have to think about – should we be using corn, food crops, for fuel?

Robey argued that moderately high corn prices in the U.S., in the $4 to $6 per bushel range, are necessary to stimulate production around the world and to prevent dumping on overseas markets by U.S. producers.

“There has been political pressure from livestock producers. They would like to see $2 corn, or $1 corn. It lowers their feed costs. I came out of that industry; I understand. Feed is about 55 to 65% of the cost of production of poultry.”

Robey says there’s a tremendous amount of corn out there available for fuel use, especially if you are including the husks and other refuse. “This will be the eighth largest corn crop in us history.”

Moreover, yields will increase around the world once technology used in the U.S. is exported and used. “A lot of technology is in play that will make corn abundant in the future,” he said.

Here’s a video of the press conference announcing the opening of Project Liberty:

EPA and Farmers: Future Unclear as Jackson Plans Exit

Fri, 13 Nov 2020 05:58:40 GMT

U.S. Environmental Protection Agency (EPA) Administrator Lisa Jackson announced Thursday that she will leave that post early next year , creating questions about what policy changes are ahead for farmers.

“In my recent speeches, when I said that she would likely leave, farmers clapped,” says Jim Wiesemeyer, vice president of Informa Economics. “So that shows you the attitude they had about her, right or wrong.”

(Click here to read EPA Administrator Lisa Jackson’s complete statement.)

Farmers usually want to hear a more moderate tone from an EPA administrator, so it will be a good omen if President Barack Obama’s nominee talks publicly about the costs and benefits of regulation.

“Sometimes these regulations are more costly than they’re worth,” Wiesemeyer says. Administrators frequently are chosen from the environmentally sensitive New England area, but it’s unclear at this point whether that will happen again.

“Whomever he selects will have to be confirmed, and that will draw out a number of needed questions by both Democratic and Republican farm-state lawmakers,” he says.

Obama took an aggressive approach to environmental policy issues for the first two years of his presidency and later put it on hold in the run-up to the election, Wiesemeyer says. Secretary of Agriculture Tom Vilsack has tried to explain the Obama administration’s policy in less emotional terms, Wiesemeyer says, though he cautions that some farm-state lawmakers have overreacted about what new regulations the EPA might or might not impose.

Out of all farmers, those in the livestock sector are particularly nervous about the future of environmental policy as it relates to CAFO and other regulations, he says.

Referencing comments by Obama earlier this year, Jackson says the EPA has taken additional steps toward energy independence and kept air, water and food safe during her tenure.

“I will leave the EPA confident the ship is sailing in the right direction, and ready in my own life for new challenges, time with my family and new opportunities to make a difference,” she says.

Vilsack says that Jackson has been a friend to people who “live and work in rural America” and that her leadership will be missed.

“Lisa Jackson has served our country well as she balanced improving the environment and the health of the American people - while ensuring our country’s economic competitiveness - because they are intrinsically linked,” Vilsack says. “Throughout her tenure, she listened to stakeholders, including farmers and ranchers, and took their concerns into account while considering policies that impacted rural America.”

The National Corn Growers Association thanked Jackson for “acting on the Obama Administration’s commitment to ethanol and other biofuels.” In describing her tenure, the organization voiced its support for Jackson’s efforts to:

Approve E15, a 15% ethanol blended fuel, for use by consumers
Deny requests for a waiver of Renewable Fuel Standard provisions
Maintain existing rural dust standards and continue registration of atrazine
Expedite special review of AF-36, an aflatoxin mitigation tool

“Administrator Jackson worked with NCGA to support the ethanol industry and promote science-based regulations during her tenure,” says Chairman Garry Niemeyer, a farmer from Auburn, Ill. “Upon the announcement of her departure, we thank her for the action she took on behalf of the administration to advance E15, support the RFS and for her willingness to work with America’s farmers. We hope to continue working in this cooperative, productive manner with her successor.”

President Roger Johnson of the National Farmers Union also voiced his organization’s appreciation for the administrator , noting the obstacles she faced.

“Although her tenure was marked with challenges, including unfounded allegations of phantom regulations, secret spy drones and cow taxes, these criticisms proved to be unwarranted,” Johnson says.

Also during Jackson’s tenure, the EPA “took further steps to include a wider variety of feed stocks for the Renewable Fuel Standard, including grain sorghum, which will expand opportunities in rural America,” he says.

Water Hogs No Longer

Fri, 13 Nov 2020 05:56:27 GMT

The ethanol industry is a thirsty business, with the average U.S. ethanol plant requiring about 300 million gallons of water every day for processing and cooling equipment, according to the Renewable Fuels Association (RFA). That’s equivalent to the water supply for a town of about 5,000 people.

This daily need for water has some ecologists and state officials wondering about the effect on water supplies in areas where there is already high demand for water.

In Minnesota, for example, the state now orders full environmental reviews on proposed ethanol plants, citing concerns about water availability. At least one proposed plant, near Pipestone, did not get built because of worries about the lack of water to run it.

The good news is that water issues are forcing ethanol plants to grow more efficient. U.S. ethanol facilities today are using 27% less water than five years ago, according to a study by the U.S. Department of Energy. Meanwhile, ethanol production has increased 276% in that time frame.

Technology wins out. The dramatic improvements that have been seen in dry-mill ethanol production demonstrate the industry’s commitment to developing the most efficient technologies available, says Bob Dinneen, RFA president and CEO.

Water usage in biorefineries is declining as ethanol producers increasingly incorporate water recycling and develop new methods of converting feedstocks to fuels that increase energy yields while reducing water use.

“Water recycling technology today is light-years ahead of where it was when many ethanol plants started,” says Jeff Gross, global marketing manager for biorefining at Ashland Hercules Water Technologies, which supplies products and process improvement technologies to ethanol facilities. “Today, we are able to retrofit plants to help them reduce water usage by 20% to 30%.”

It makes good business sense for ethanol plants to lower their water usage, Gross adds. With new water technology and minor process enhancements, facilities can significantly lower not only their water usage but also their costs, he says.

New ethanol plants use about 3 gal. to 5 gal. of water for each gallon of ethanol that is produced, according to the Nebraska Center for Energy Sciences Research. Newer plants also are designed to recycle 80% of the water they use so they are not continuously drawing fresh water.

Not that much water. At the end of the day, the amount of water used by ethanol plants on a state level is just not that huge, says Monte Shaw, executive director of the Iowa Renewable Fuels Association. Iowa is the leading state for ethanol production, with 42 ethanol facilities.

“If you look at the permitted water use in Iowa, all of the industrial groundwater permits account for less than 5% of water use,” Shaw says. “Ethanol is just a small part of that pie. We’re just not that big a user of water statewide.”

To place this situation in a familiar context, Shaw likes to point to the fact that it takes 150 gal. of water to produce the average Sunday newspaper, according to figures from the U.S. Geological Survey and the Environmental Protection Agency.

“So for every editorial written against ethanol, we could have another gallon of ethanol,” Shaw says.

You can e-mail Jeanne Bernick at jbernick@farmjournal.com .