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GreenShift Corporation has simultaneously announced that it has filed for its third patent on its corn-oil extraction technologies while at the same time, commencing legal action against Big River Resources Galva, Big River Resources West Burlington and Cardinal Ethanol for infringing on GreenShift’s U.S. patent covering its corn oil extraction technology.

GreenShift's Corn Oil Extraction Technology

The complaint against Big River alleges that they infringed upon GreenShift’s U.S. Patent No. 7,601,858, titled “Method of Processing Ethanol Byproducts and Related Subsystems” (the “858 Patent”). The patent covers processes for recovering corn oil by evaporating and mechanically processing thin stillage, a precursor to the distillers grain co-product of corn ethanol production (“DGS”). Greenshift is claiming that Big River has caused a loss of income and irreparable harm.

Kevin Kreisler, chairman and CEO of GreenShift said in a company statement regarding the lawsuits, “There was no market for corn oil extraction from dry mill ethanol plants before we invented our now-patented technology in 2004. We estimate that more than about 20 percent of the ethanol industry has begun to use our technology without a license. While we are eager to earn the business of each last producer, we expect to have the opportunity to do so by helping each to realize additional value.”

Kreisler continued, “We innovated corn oil extraction technology, created the corn oil extraction market, and subsidized disruptive value creation for the U.S. corn ethanol industry; we have earned our patents and we deserve the full measure of the first mover competitive advantage. This, and any other, continued infringement is causing GreenShift irreparable and immediate harm and it must stop.”

However, ICM has come to the defense of Cardinal Ethanol, as the suit is against ICM equipment. ICM built the ethanol plant that went online in November of 2008.

“ICM will defend its customers as a companion matter to ICM’s own litigation against GS CleanTech and its affiliate, GreenShift Corporation, which we filed in Kansas in October 2009,” said Chris Mitchell, ICM’s vice president of marketing. “ICM believes that GS CleanTech’s alleged patent claims will be proved to be invalid. In the Kansas litigation, we have asserted that GS CleanTech/GreenShift misrepresented the liability of ICM’s customers for operating the ICM system, and that various actions of GS CleanTech/GreenShift constitute unfair competition and wrongful interference with ICM’s existing and prospective business and contractual relationships. Our customers continue to operate their oil recovery systems acquired from ICM, and we continue to see strong interest from prospective customers for further orders for ICM’s equipment.”

And patents they seek.
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The futures hold a new climate of opportunity for corn, ethanol and livestock producers.

CME Group this week announced the launch of Distillers’ Dried Grain agricultural commodity futures contracts, scheduled to begin trading April 26. Information about the new contract was released during the Renewable Fuels Association’s National Ethanol Conference in Orlando where CME Group was a sponsor.

Distillers’ Dried Grains, a byproduct of corn-produced ethanol, is used for animal feed, including livestock and dairy cows. The electronically traded and physically delivered futures contracts can be used by livestock and ethanol producers, commercial corn interests and others to lock in the price of feed or to hedge their ethanol refining margin in combination with corn, natural gas and ethanol futures.

The contracts will be listed with the Chicago Board of Trade and more information is available on the CME Group commodities website.

Global Ethanol recently received the rights to use new corn oil extraction technologies at a 100 million gallon ethanol plant in Lakota, Iowa.

The technology, patented by GreenShift Corporation allows first generation corn ethanol plants to tap into the existing reserve of inedible crude corn oil with an estimated industry-wide output of about 20 million barrels per year. This corn oil normally comes out in the distillers grain co-product of ethanol production, but once extracted it can be used in the production of next generation fuels, such as biodiesel, biojet fuel, and renewable diesel, thereby enhancing total fuel production from corn and increasing ethanol plant profits.

Under the terms of the agreement, Global will directly finance, build, own and operate a facility based on GreenShift’s patented corn oil extraction technologies designed to extract more than 2.2 million gallons per year of corn oil in return for an ongoing royalty payment to GreenShift equal to more than about 20 percent of the market price of the extracted corn oil at the time of shipment.

A by-product of ethanol production in the United States is feeding water buffalo in Egypt.

In fact, corn growers on a recent U.S. Grains Council mission found that DDGS (dried distiller’s grains with solubles) have become quite popular as livestock rations in that part of the world. “We found several farms that have incorporated distillers grains into their rations and are making good use of them,” said Missouri corn grower and mission participant Jim Stuever.

USGC director for Egypt Dr. Hussein Soliman says they introduced DDGS to producers in 2006. “We introduced 6,000 metric tons in 2006 to start, now we’ve reached 80,000 metric tons, and in two years that will be 200,000 metric tons,” he said.

The corn grower mission met with Dr. Saad Alhayani, who owns and operates a very new open water buffalo feedlot and dairy near Cairo and is also chairman of the Egyptian Buffalo Producer’s Association. “We started two years ago putting five percent and now sometimes we put 25 percent (DDGS) in our diet and it brings very good results,” Alhayani said.

Watch a video clip of Dr. Alhayani’s water buffalo operation here:

USGC Corn Mission In Egypt Photo Album

USDA Deputy Secretary Dr. Kathleen Merrigan will get some first hand knowledge of Iowa’s ethanol industry during a tour scheduled for October 20. During her visit, Dr. Merrigan will learn about ethanol production, utilization of co-products and biodiesel research.

Merrigan will first visit Lincolnway Energy, a 50-million gallon per year ethanol plant with a corn oil extraction process. Next, she will tour Couser Cattle Company’s 5,000 head operation which utilizes distillers grains as livestock feed. Finally, Deputy Secretary Merrigan will tour Renewable Energy Group’s Research Center which houses industry-leading biodiesel programs, including cutting-edge corn oil-to-biodiesel commercialization research.

The U.S. Grains Council is setting up demonstration trials in targeted countries to educate livestock producers about the nutritional and economic benefits of using ethanol co-products like corn gluten feed (CGF) and distillers dried grains with solubles (DDGS)

“Conducting the trials locally gives local farmers a chance to see DDGS and CGF use firsthand in a trial that utilizes their own climatic conditions. It provides them a reliable source of data they can be more confident in,” said Lori Feltis, USGC Rest of the World Advisory Team member, who is currently in Egypt to assess the use of U.S. DDGS and CGF.

In April, the Council initiated a demo-trial in Egypt where local animal production operations formulated DDGS and CGF inclusion ratios in their feed rations. This week, USGC consultants, staff and Feltis traveled to Egypt to analyze the ongoing progress of the trials.

The U.S. Grains Council’s (USGC) Annual China Corn Tour currently underway is finding big demand for the ethanol co-product distillers dried grains for livestock feed in that country.

According to Cary Sifferath, USGC Senior Director in China, drought conditions in China this year have led to high corn prices. “Those high prices have led to some opportunities for US feed grains products, specifically distillers dried grains (DDGS) products from the US ethanol industry,” Cary said. “We had roughly 8,000 metric tons of DDGS that was exported from the US into China and right now for 2009 we can easily predict 250,000 to 300,000 tons of distillers dried grains being imported by China’s feed and livestock industry, especially in the southern and coastal areas of China where DDGS has become a very competitive feed ingredient.”

Drought conditions in some areas of China are expected to result in crop losses of up to 50 percent this year.

Pictured in the photo are Sam Niu, USGC assistant director for China, Sifferath, and National Corn Growers Association board member Guy Davenport of North Carolina.

The leftovers from an ethanol co-product could be used as a fertilizer, according to research being done at South Dakota State University.

When the ethanol by-product known as dried distillers grains with solubles (DDGS) is heated at high temperatures under limited oxygen to make synthesis gas, or syngas, the remains are a fine, dust-like ash. SDSU Soil Testing Laboratory manager Ron Gelderman set out to learn whether that residue could be applied to fields as a soil nutrient, since the ash likely would be discarded in a landfill otherwise.

An SDSU greenhouse study found that dried distillers grain ash resulted in about the same increase in corn growth as fertilizer phosphorus. Use of dried distillers grain ash as a source of potassium in that study was inconclusive, since the selected soil supplied adequate plant potassium.

“After ashing or burning, the inorganic minerals are generally left in the ash and usually are plant-available. But we have to test that to be sure. We found that it worked quite well,” Gelderman said.

However, Gelderman says the problem is that the material is too fine to be used as a fertilizer spreader-type application, which means that further processing of the material — for example, into pellets, or as a liquid slurry, or mixed with manure or lime — might be necessary to get it back onto the land.

The Institute for Agriculture and Trade Policy (IATP) recently published a report that called for the ethanol industry to stop using antibiotics in the production process. Many believe that this report is just one of many initiatives the IATP has to fight the modernization of the agriculture and livestock industry and that they are attempting to manufacture controversy.

Antibiotics are widely used in production of biofuels as a critical tool for infection management. Through the use of small amounts of antibiotics such as Phibro’s Lactrol antimicrobial, the U.S. biofuels industry eliminates the need to plant an additional 3.2 million acres of corn to produce 500 million bushels of corn.

Just last week, Phibro Animal Health Corporation (Phibro) released a study from its Ethanol Performance Group showing that the use of antibiotics is safe.

According to Phibro, IATP’s position, that use of antibiotics in the production process results in residues in distillers’ dried grains (DDG) in turn putting human health at risk is a stunningly broad conclusion not based upon fact or science. The IATP’s broad policy statement fails to mention:

• •    The proper use of antibiotics is a safe practice in both renewable fuels and in animal husbandry that preserves our precious agricultural resources such as land and water.

• •    Since its introduction in 1993, Lactrol® has remained a safe product for use in renewable fuels production and distillers’ grain production. It has been sold under an FDA letter of no objection in addition to the regulatory discretion of the FDA’s Center for Veterinary Medicine (CVM).

• •    In the past 3 months Lactrol® alone has been sold to far greater than 55% of the current operating plants. The IATP falsely asserts that 45% of current producers are able to operate without antibiotics.

This is just one negative issue among many that are splashed across the papers on a daily basis. However, biofuels are the only viable solution we have today to offset foreign oil imports. Click here to read the full statement from Phibro.

There has been concern about the quality of dried distillers grains (DDG) but once again, tests show that they are safe. Phibro Animal Health Corporation (PHAC) has just released test results from its Ethanol Performance Group™ that no virginiamycin has been detected in distillers’ grain. Virginiamycin is the active ingredient in Lactrol®, the company’s market leading antimicrobial for ethanol production. PAHC just concluded testing over 40 samples, which included wet and dry distillers’ grain and distillers’ grain with syrup. Samples were taken from 11 facilities and testing was conducted by an outside laboratory and by Phibro’s technical service laboratory in St. Paul, Minn. These results are not different than those from 2005 and 2007.

Using the only testing method accepted by the Food and Drug Administration (FDA) for use in virginiamycin feed assays, no residues were detected in any of the 42 DDG samples. This method will be part of PAHC’s food additive petition to be submitted to the FDA’s Center for Veterinary Medicine (CVM) in September 2009 for its Lactrol® antimicrobial. Lactrol® is a market leading infection management tool used for decades by the fuel ethanol industry and to date is the only antimicrobial product ever to be reviewed by the CVM for use in ethanol production. Results continue to demonstrate that Lactrol®, when used as indicated, allows ethanol producers to produce the most alcohol from the least amount of corn.

Antimicrobials are a widely used and important tool for infection management in ethanol production. While technical advances continue in manufacturing design and operation, bacteria are still present during fermentation and prevent optimal yields of ethanol. The ethanol industry has recognized that through the use of small amounts of antimicrobials such as Lactrol®, the United States annually gains an extra 1.5 billion gallons of ethanol from the corn feedstock currently used by the industry.

Domestic Fuel is sponsoring a Process Optimization Seminar being presented by Phibro Ethanol Performance Group, Fremont Industries, Fermentis and Novozymes. The event is July 29-30 in Minneapolis, Minn. You can register by clicking here.