Domestic Fuel

Rainforest deforestation rates have reached new lows, which further challenges the theory of international land use change that has been used to penalize corn ethanol for its carbon footprint.

Brazilian President Luiz Inacio Lula da Silva announced today that deforestation rates in the Brazilian Amazon declined 14 percent from August 2009 to July 2010, reaching the lowest rates ever recorded for the second consecutive year.

Satellite images analyzed by Brazil’s National Institute for Space Research (INPE) show that an estimated 6,450 square kilometers of forests were cleared in the 12-month period, bringing rates to their lowest since monitoring started in 1988. The record-breaking decrease represents a major contribution to reducing Brazil’s greenhouse gas emissions, as global negotiations progress at the 16th Conference of the Parties to the United Nations Framework Convention on Climate Change (COP16), currently underway in Cancun, Mexico.

In a post on the Renewable Fuels Association E-xchange blog, Vice President of Research and Analysis Geoff Cooper says this development is yet another blow to the already roundly rejected hypothesis of international land use change (ILUC) first proposed three years ago by Environmental Defense Fund attorney Timothy Searchinger.

“Today’s announcement by Lula is just the latest exhibit in a recent barrage of evidence that is undermining the argument that ILUC is a significant concern in the context of U.S. biofuels expansion,” writes Cooper, noting that annual U.S. ethanol production stood at 3.4 billion when deforestation peaked in 2004. “In 2010, the ethanol industry will produce nearly 13 billion gallons. So, Amazon deforestation has fallen 76% since 2004, while U.S. ethanol production has increased 279% in the same period.”

Cooper adds that he hopes the news out of Brazil will be greeted warmly by the environmental community, but he doubts it. “Unfortunately, I have a feeling the response from NRDC and others may go something like this: “Well, how much lower would deforestation have been without biofuels in the U.S.?” This response, of course, dodges the real issues at hand and resorts back to hypotheticals and computer models.”

While a group of senators yesterday urged an end to ethanol incentives, another group sent a letter supporting an extension of the current tax credit and associated tariff.

The letter, sent to Senate leadership and signed by Senators Charles Grassley (R-IA) and Kent Conrad (D-ND) with 13 others, asked that the ethanol incentives be “a high priority on the Senate’s legislative agenda” during the lame duck session.

“Allowing the provisions to expire or remain expired would threaten jobs, harm the environment, weaken our renewable fuel industries, and increase our dependence on foreign oil,” they wrote, asking that Congress act to “extend the biofuels tax and tariff policies for the longest term possible.”

Earlier this year, Grassley and Conrad introduced the bipartisan GREEN Jobs Act of 2010 that would extend through 2015 the Volumetric Ethanol Excise Tax Credit (VEETC), the offsetting tariff on foreign ethanol, the Small Producers Tax Credit, and the Cellulosic Ethanol Producer Tax Credit.

Growth Energy CEO Tom Buis noted that as long time veterans on the tax writing Finance Committee, Sens. Conrad and Grassley play a critical role in the energy debate. “We commend these senators for their efforts to ensure a cleaner, more secure energy future for America,” said Buis. “The current ethanol tax incentives have played a critical role in the development of the ethanol industry in the United States and reducing our dependence on foreign oil. In the near-term, an extension of the ethanol tax incentive and the tariff will stabilize the marketplace, provide added certainty and give Congress the opportunity to consider longer term solutions next year.”

The Survey Monkey has spoken and the winner is …. drum roll, please….

Jamie Wilson with the Corn Marketing Program of Michigan

Jamie reads Domestic Fuel and says she is most interested in stories related to ethanol. We sincerely appreciate her taking the time to fill out the survey so we can learn more about our audiences on all the various ZimmComm on-line publications. All the survey entries for November were entered to win $250 and Jamie’s name was picked out of the hat this morning. All those who have already filled out the survey will remain in the running for the next drawing at the end of this month for another 250 bucks.

Some interesting results we have found so far from the first month of our survey:

Domestic Fuel got the most survey responses, which makes sense since it has the most traffic. The majority of respondents were either existing producers (12.5%) or in marketing/sales for biofuels (10%)

On World Dairy Diary, one quarter of respondents said they were actual dairy farmers and over 35 percent said they followed WDD on Twitter.

Over 30% of the respondents for Agwired are in advertising, marketing, communications or public relations. Almost 40% said they read Agwired 4-7 times a week and the same amount follow on Twitter.

One third of the respondents on Precision Pays are crop farmers and all of them grow corn and soybeans.

We have almost enough entries at this point to be statistically significant, which is great, but we intend to keep it going at least through the end of January. The more responses we get, the better we can know who is in our audience to serve you better. Yes, we have to ask for all the personal info like name and address, but we will not share that with anyone else. We just simply want to get a better handle on who you are and what you want to read about.

So, if you have not responded yet, take the survey now by clicking here for this website. Jamie – your check is in the mail and we hope you enjoy the extra holiday cash!