Food Prices Still Up Despite Lower Corn Prices

With record corn production forecast this year comes lower corn prices, which makes the food versus fuel argument harder than ever to make, according to Growth Energy.

Total corn production is now projected at 14.475 billion bushels, 550 million bushels more than last year’s record, while the average price received by farmers is expected to be $3.40 per bushel, the lowest price in eight years.

Meanwhile, the United Nations Food and Agriculture Organization (FAO) reports the international food price index is down 6.0 percent over the last year, grain prices are down nearly 9 percent since 2013, but meat prices are nearly 22 percent higher than a year ago.

Domestic food prices are up 2.5 percent compared to December 2013, nearly the same as the overall Consumer Price Index, which is up 2.1 percent for the same period. But while corn and other grain prices are rapidly declining, consumer meat prices are up 11.6 percent since last December.

growth-energy-logo“The current WASDE projections and recent reports from the FAO and Bureau of Labor Statistics further confirm that there is virtually no correlation between U.S. ethanol production and consumer food prices,” said Tom Buis, CEO of Growth Energy. “Corn prices are below the cost of production for most farmers, and ethanol is selling approximately $1.00 per gallon less than the gasoline on the wholesale marketplace.”

“As integrated livestock and poultry companies brag about their record profits and margins to their stockholders and investment bankers, the Turkey Federation, National Chicken Council and The National Council of Chain Restaurants, all allies of Big Oil, continue their campaign to intentionally mislead Americans about the cause of rising food prices in the U.S,” Buis added.

USDA Increases Crop Forecast Again

il-harvest-14The harvest may be running a little slow right now, but the latest report from USDA’s National Agricultural Statistics Service is calling for a bit more corn than expected a month ago, adding to the already record forecasts.

Corn production is now forecast at 14.5 billion bushels, up almost one percent from the previous forecast and four percent more than last year. Corn yields are expected to average 174.2 bushels per acre, up 2.5 bushels from the September forecast and 15.4 bushels above the 2013 average.

The bigger crop mean lower prices and USDA’s latest World Agricultural Supply Demand Estimate also released today. Corn supplies for 2014/15 are now projected at 15,736 million bushels, up 129 million from last month, while season average prices were lowered 10 cents to $3.10 to $3.70 per bushel. Corn used to produce ethanol, distiller’s grains and other co-products is projected at 5.125 billion bushels, while corn consumption for feed is estimated at 5.375 billion bushels.

“PUMP” Movie Getting Good Reviews

pump-movieA new documentary film that explores the history of the American fueling infrastructure and how it has led to today’s oil-dominated market, which features some ethanol industry figures, is being well received by critics and viewers alike.

“PUMP” the movie, opened last month and has a rating of 71% fresh on Rotten Tomatoes, with an 82% audience approval rating. Big name reviewers like the New York Times and Variety have had very good things to says about the movie.

The film is the latest from Josh and Rebecca Tickell, who have done other documentaries on alternative fuels beginning with FUEL, released in 2009, that focused on biodiesel.

PUMP features several familiar faces of folks known in the renewable fuels industry, including “Energy Victory” author Dr. Robert Zubrin, Biofuels Digest Editor Jim Lane, and Renewable Fuels Association Vice President for Industry Relations Robert White.

“Not often do small town farm kids from Kansas make it to Hollywood’s big screen, but I am fortunate enough to be one of those, if even for just a few seconds,” writes White in a column today for the E-xchange Blog. “The opportunity to be a part of an educational effort of this scale is not only rewarding, it is exciting.”

To find out more about the movie and when it might be playing in your area – check out PumpTheMovie.com and like it on Facebook.

Get to Know the Minnesota Bio-Fuels Association

In April 2011 the Minnesota Bio-Fuels Association was founded to represent and promote the renewable fuels industry in Minnesota. According to Tim RudnickiTim Rudnicki Executive Director MN Bio-Fuels Association, executive director, as a state and a union, the country faces many challenges on the energy and environmental front and the Minnesota Bio-Fuels Association is providing solutions to these challenges.

When asked about the Association, Rudnicki explained, “We are a non-profit organization and our members include ethanol producers in Minnesota as well as industry vendors. Our aim is to work with our stakeholders in a collaborative manner to achieve our collective goal of a greener future, a stronger economy in Minnesota, consumer savings at the pump and a more energy independent America.”

The Association has three key areas of focus:

  1. Advocacy: Their active engagement takes place at the state capitol in St Paul with a variety of state agencies and departments as well as through the governor’s office. They work with policymakers and agency officials to give voice to the biofuels industry in matters that impact day-to-day production operations and to further grow the industry.
  2. Fuel Supply Chain Development: They work closely with fuel retailers in the state to increase the availability of fuels such as E15 and E85. They are also able to connect them with wholesale suppliers of E15 and E85 and infrastructure and equipment providers and also educate them on the business case to sell E15 and E85.
  3. Communications: As the representative of the biofuels industry in Minnesota, they organization is constantly communicating and educating consumers on the various benefits of ethanol in transportation fuel as well as changing negative perceptions. Their communication channels include a website with extensive resources on biofuels, social media, advertising and email marketing and they also liaise with the media throughout the state.

One of the founding members of the Minnesota Bio-Fuels Association is Highwater Ethanol, a 59.5 million gallon per year denatured ethanol facility located in Lamberton. They also produce nearly 150,000 tons of dried distillers grains (DDGs) and in April of this year began producing corn oil.

In May of 2006, Brian Kletscher began working with Hightower Ethanol as the president of the Board of Directors and then in November of 2008 was hired as the CEO. He has served as the president of Minnesota Bio-Fuels Association since 2011.

When asked why Highwater Ethanol became involved with the Association, Kletscher noted that being a part of Minnesota biofuel producers, they needed another strong voice to deal directly with potential challenges for the industry and the Association is set up to address many biofuel opportunities. For example, the Association has been participating in bringing additional biofuel usage to Minnesota, by supporting usage of higher blends of ethanol and other biofuels. Continue reading

MIT Boosts Yeast Tolerance

Gregory Stephanopoulos, with the Willard Henry Dow Professor of Chemical Engineering at MIT has discovered a way to boost yeast tolerance to ethanol by altering the composition of the medium in which yeast are grown. “Toxicity is probably the single most important problem in cost-effective biofuels production,” said Stephanopoulos. The research was published in the journal, Science.

Ethanol and other alcohols can disrupt yeast cell membranes, eventually killing the cells. The MIT team found that adding potassium and hydroxide ions to the medium in which yeast grow can help cells compensate for that membrane damage. By making these changes, the researchers were able to boost yeast’s ethanol production by about 80 percent. They found the approach works with commercial yeast strains and other types of alcohols, including propanol and butanol, which are even more toxic to yeast.

MIT yeast and ethanol research.jpg“The more we understand about why a molecule is toxic, and methods that will make these organisms more tolerant, the more people will get ideas about how to attack other, more severe problems of toxicity,” explained Stephanopoulos.

The research team began its quest searching for a gene or group of genes that could be manipulated to make yeast more tolerant to ethanol, but this approach did not yield much success. Yet when the researchers began to experiment with altering the medium in which yeast grow, they found some dramatic results. By augmenting the yeast’s environment with potassium chloride, and increasing the pH with potassium hydroxide, the researchers were able to dramatically boost ethanol production. They also found that these changes did not affect the biochemical pathway used by the yeast to produce ethanol: Yeast continued to produce ethanol at the same per-cell rate as long as they remained viable. Instead, the changes influenced their electrochemical membrane gradients — differences in ion concentrations inside and outside the membrane, which produce energy that the cell can harness to control the flow of various molecules into and out of the cell.

Ethanol increases the porosity of the cell membrane, making it very difficult for cells to maintain their electrochemical gradients. Increasing the potassium concentration and pH outside the cells helps them to strengthen the gradients and survive longer; the longer they survive, the more ethanol they make.

Researchers are also working on using this approach to boost the ethanol yield from various industrial feedstocks that, because of starting compounds inherently toxic to yeast, now have low yields.

RSI-CTC Calls for Rail Rulemaking Harmonization

The Railway Supply Institute Committee on Tank Cars (RSI-CTC) has submitted comments to the U.S. Pipeline and Hazardous Materials Safety Administration (PHMSA) in response to efforts to create new regulations for the shipment of crude oil and ethanol. While RSI-CTC is glad of the government’s work, they are warning of significant disruption to safety and major sectors of the North American economy is mismatched rules are implemented by the U.S. Department of Transportation (DOT) and Transport Canada. These disruptions, said RSI-CTC, include the loss of a significant portion of the rail tank car fleet during the modification period, and unintended consequences such as a potential increase in truck shipments of flammable liquids on highways.

To address these potential disruptions and safety hazards, the RSI-CTC called for greater harmonization between the two rulemaking bodies in the U.S. and Canada, and provided insight and specific recommendations across a range of issues that will help reduce the risk of transporting flammable liquids by rail in North America. The comments also urged DOT to focus more on the root causes of most derailments which continue to be track failure and human error, not tank car design.

railway supply institute logo“For years we have been advocating for a holistic approach to safety that will prevent train derailments and address tank car standards, among other issues,” said Tom Simpson, President of RSI. “In our comments today, we reiterated our positions and offered a comprehensive set of practical recommendations that will bring the greatest safety benefit in the quickest ways possible. For instance, we believe the timelines for modifications in the U.S. and Canada should be synchronized and feasible to avoid major disruptions of service. Moreover, the specifications for new tank cars and the rules for packaging of flammable liquids need to match up across North America. Without making these important changes to align the rules, the effect will be to deplete the fleet of tank cars available for service, and those effects to safety and the economy cannot be underestimated.”

RSI-CTC and independent third-party research show that the proposed U.S. rules—in their current form—would effectively force approximately 90,000 tank cars to be withdrawn from service at various times during the modification program and parked until the shop capacity required to carry out the necessary modifications becomes available. Between 2018 and 2020, 30-50 fifty percent of the total crude oil and ethanol tank car fleet would be idled at any given time. To replace the loss in 2017, the year the first compliance deadline hits, theoretically it would require 20,000 trucks carrying more than 370,000 truckloads on North American highways, a practical impossibility and potentially more hazardous outcome given the safety risk associated with transport by truck.

In its comments to PHMSA, the RSI-CTC supports a “commodity-based approach” for selecting the proper tank car that requires shippers to ensure materials are appropriately and safely packaged. The RSI-CTC also asked PHMSA to differentiate the requirements for new and existing cars, which will allow more new or modified cars with enhanced safety features to be put into service more quickly, rather than a one-size-fits-all approach.

RFA Case Study: Evidence of E85 Price Gouging?

According to a new case study from the Renewable Fuels Association (RFA), E85 retailers in the St. Louis area may be intentionally price gouging consumers. According to the report, during the 2014 summer driver season, the average E85 price was 12 percent Evidence of Price Gouging RFA Case Studybelow gasoline prices at the wholesale level but one percent higher than gas prices at the retail level. The wholesale-to-retail markup on E85 was nearly twice the markup on gas. In addition, the study concluded that E85 retail prices were around $1 per gallon higher than was justified by wholesale prices for the locally available ethanol blendstock.

The study’s results offer “… clear support for the notion that some gasoline producers/suppliers and their franchised retailers purposely employ E85 pricing strategies meant to discourage E85 consumption and negatively influence consumer perceptions about the fuel.”

Bob Dinneen, president and CEO of the RFA, said of the case study, “It’s fairly obvious that the retailers examined in this study—all of whom are branded by one of the Big Five oil companies—don’t really want to sell E85. In many cases it appears they were pricing E85 above their branded gasoline for the sole purpose of making their gasoline prices look more attractive to the consumer. Sneaky E85 pricing strategies ultimately give oil refiners the opportunity to wrongly claim that consumers are ‘rejecting’ E85; and it gives them an opportunity to claim they can’t comply with Renewable Fuel Standard (RFS) requirements above the so-called ‘blend wall.’ This study exposes the utter hypocrisy of that argument.”

RFA tracked E85 and gasoline (E10) prices at all nine retail stations selling E85 in the St. Louis metro area. All nine stations carry the brand of one of the five largest integrated oil production and refining companies. This makes the St. Louis E85 market highly unusual because nationwide “…retail stations affiliated with a ‘Big Five’ oil company brand are four to six times less likely to offer E85 than independent or unbranded stations.”

Across more than 250 observations during the summer, the average E10 retail price was $3.45 per gallon and the average E85 retail price was $3.476 per gallon. Meanwhile, E85 was available at a local wholesale terminal for an average of $2.58 per gallon, while E10 averaged $2.93 per gallon at the wholesale level. Based on prices for locally available ethanol, hydrocarbon blendstock, RFS RIN (Renewable Identification Number) credits, and a typical markup, E85 could have been offered at retail for $2.44–2.55 per gallon. Continue reading

Ethanol Report with New RFA Chairman

ethanol-report-adRandall Doyal, General Manager and CEO of Minnesota-based Al-Corn Clean Fuel, is the new Chairman of the Board of Directors for the Renewable Fuels Association (RFA).

rfa-doyal-1Doyal’s plant located in Claremont, Minnesota opened in 1996 and now produces 50 million gallons annually. In this interview, he talks about some of the challenges and opportunities facing the ethanol industry in the immediate future. Challenges include the lack of certainty surrounding the Renewable Fuel Standard (RFS) and railway transportation problems, while the importance of ethanol as a higher octane fuel and increasing exports are rising opportunities.

Ethanol Report with New RFA Chairman

Is there Enough Feedstock for Gen 2 Ethanol?

Last week Biofuels Digest Editor Jim Lane posed the question: Is there really enough affordable feedstock for the second generation ethanol wave? According to Robert Kozak of Atlantic Biomass Conversions an co-founder of Advanced Biofuels USA, “Yes, if we realistically address the financial realities of feedstock producers and feedstock buyers.” He reviewed the current weaknesses in current biomass development philosophy for feed, fuel, chemicals and biobased products and penned his findings in a white paper.

Advanced Biofuels USA Biomass Crops white paperKozak looked at a several possible biomass feedstocks including switchgrass, miscanthus and other grasses to dandelion roots and carrot and sugar beet residues. He concludes that the combination of saturated markets and increasing production costs may soon cause corn growers to either start returning land to the Conservation Reserve Program (CRP) and other programs (and increasing U.S. taxpayer costs) or to find other crops. In response, he advocates taking a closer look at what we have learned about biomass conversion technologies over the past 10 years along with farm policy.

In the paper he writes, “So, with approximately 20-25 percent of current US corn production being used for fuel ethanol, the questions for growers become: Could portions of this land be used for lower nutrient input biomass crops that would produce comparable income from ethanol or other biofuels and biomaterials? Could corn land not within current shipping distance of existing ethanol refineries also be used for biofuel/biomaterial crops? … I think the right answers to these questions could not only retain current grower incomes but more importantly, could be an opportunity to build the foundation of a true Advanced Biofuel and Biomaterial System.”

Kozak proposes root crops as a viable solution to these challenges. He bases his arguments on cell wall structure, lack of pesky lignin, and potential for over-wintering in situ to address storage logistics, etc. He acknowledges that these are very preliminary thoughts on a complex issue which deserves greater scrutiny. He also suggests convening an action-oriented conference or a series of workshops where experts involved in all aspects of the subject can gather for intense discussions.

“PUMP” Coming to a Theater Near You

There is a new documentary coming to a theater near you: PUMP. The film tells the story of America’s addiction to oil. Stories told range from Standard Oil’s illegal tactics to the dominance of oil companies. The goal of the film is to explain why and how consumers can end Big Oil’s monopoly and “win choice at the pump”.

According to the movie’s website, gasoline is our only option of transportation fuel today. With global demand rising and the continued dependence on gas our wallets are thinning. In addition, air pollution is getting worse and Americans are fighting wars in oil-rich countries.

PUMP shows consumers how making a variety of replacement fuels widely available will reduce fuel prices across the board. Diversifying the market with replacement fuels that are cheaper, cleaner and American made will also create jobs, strengthening the economy at home and promoting stability abroad.

The movie features experts including John Hofmeister, former President of Shell Oil Co.; Elon Musk, CEO of Tesla Motors, Inc.; Peter Goldmark, former president of the Rockefeller Foundation; our colleague Jim Lane and other noteworthy figures.

To see where the movie is headed and to buy tickets, visit the PUMP website.

Registration Open for 20th NEC

rfa-nec-15“Going Global” is the theme for the 20th annual National Ethanol Conference (NEC) from the Renewable Fuels Association (RFA).

The event is being held February 18-20, 2015 at the Gaylord Texan Resort and Convention Center in Grapevine, Texas. With the U.S. leading the world in the production and exports of ethanol fuel and co-products, export markets are critical to the future of the industry. That will be explored in depth at the conference.

To find out more and get registered, go to NationalEthanolConference.com.

Tide Detergent Cleaning up with Cellulosic Ethanol

A new use for cellulosic ethanol has been announced by DuPont and Procter & Gamble.

tideThe two global leaders in science and consumer products are planning to a first-of-its-kind use of cellulosic ethanol in North American Tide® laundry detergent.

Tide Cold Water will be the first brand in the world to blend cellulosic ethanol in a scalable and commercial way. Ethanol has long been a key ingredient in the Tide® formulation, allowing for stability of the detergent formula and better washing performance. The substitution of the current corn based ethanol with cellulosic is the latest innovation in the companies’ 30-year partnership, making it easier for consumers to make sustainable choices in their everyday lives.

DuPont will produce this renewable, cellulosic ethanol at the company’s new biorefinery, currently under construction in Nevada, Iowa. Once completed, the plant will be the world’s largest bioethanol refinery, producing 30 million gallons of cellulosic ethanol per year – a process with zero net carbon emissions.

According to the companies,Tide® Cold Water “powered by nature” will re-purpose over 7000 tons of agricultural waste a year. “As one of the world’s largest laundry manufacturers, we have a responsibility to lead renewable sourcing in products,” said Gianni Ciserani, Procter & Gamble Group President of Global Fabric and Home Care. “We do this by ensuring consumers still get the great Tide® laundry performance they want, while further reducing the impact on the environment. In January, we committed to removing phosphates in our laundry products. This partnership on renewables is one more step in our journey.”

“With this collaboration, DuPont is also taking the first step to diversify its markets for cellulosic ethanol beyond fuels. As we build on our integrated science capabilities, we will continue to seek out new opportunities and new collaborations to transform value chains with more sustainable solutions,” said James Collins, Senior Vice President, DuPont.

Both Collins and Ciserani will be speaking at the World Conference on Fabric and Home Care in Montreux, Switzerland this week.

Greenbelt Resources Cellulosic Tech On Stage

Greenbelt Resources Corporation has been selected as one of only 30 showcase companies to present during GloSho’14. The prestigious event is focused on the global clean tech industry and takes place October 6-7, 2014 at Los Angeles Theater in downtown Los Angeles, California. Company CEO Darren Eng will be presenting on Monday, October 6, 2014 between 2:15 to 3:15 PM PST during the Air & Waste session in Theatre 1. The membrane technology will be displayed at Table 34 in Theater 4.

GloSho’14 helps provide the resources, skills and partners necessary to be a global player. The event includes an investment boot camp, reverse investment showcasGreenbelt Resources membrane technologyes and several sessions covering water issues in California, clean energy policy at federal and state levels, and how to capitalize on university partnerships. Attendees will include the global clean tech business community, investors, entrepreneurs, mayors, politicians, city municipal managers, energy and environmental experts and more.

“We’ve had a great response to our clean energy technology,” said Darren Eng, CEO of Greenbelt Resources. “Our invitation to present during this event solidifies what we already know – that we have a viable, cost-competitive, critically needed solution that the clean tech, agriculture, food and energy industries are taking great interest in adopting.”

Greenbelt Resources offers a modular food waste recycling system featuring an end-to-end automated ethanol production system with 24/7 remote monitoring. This configuration is the only one in the world that utilizes patent-pending membrane technology which maximizes energy and water efficiency. By feeding the system waste feedstocks including dairy, agriculture, food, beverage, brewery and alcohol wastes; or biomass feedstocks, the technology produces fuel, feed, fertilizer and filtered water coined by Eng as the “four Fs”. Continue reading

UNICA’s ‘Ethanol the Complete Fuel’ Is Back

The Brazilian Sugarcane Industries Association (UNICA) has launched is next phase of its advertising campaign, “Ethanol the Complete Fuel“. The multimedia campaign will primarily run in the state of São Paulo, the ads are designed to reinforce the positive impacts of ethanol on the economy and environment. The communication strategy consists of a 30 second TV commercial, sponsorship of television and radio programs, a striking jingle, online actions and presence in social networks.

“With the resumption of the campaign we want to remind consumers the advantages and benefits of biofuel. Ethanol generates environmental, social gains and promotes economic growth significantly in over a thousand Brazilian municipalities, “said Elizabeth Farina, UNICA president.

When first released in November 2012, the campaign leveraged ethanol sales in the state of São Paulo. In one month of placement sales increased 10%. Last year, the advertising action also aired three other states: Paraná, Goiás and Minas Gerais.

“Right now, the price of ethanol is more advantageous than gasoline for the consumer, ie the 70% parity has already been achieved in some states, yet the demand for the product did not react as expected. This reinforces our diagnosis that direct contact with the public should be constant, “said Farina.

USDA Launches Ag Industrial Reports Program

usda-logoThe U.S. Department of Agriculture’s National Agricultural Statistics Service (NASS) has relaunched the formerly defunct Current Agricultural Industrial Reports (CAIR) survey program. NASS will collect and publish vital statistics for the dry and wet alcohol milling and flour milling sectors. Beginning this year, NASS will collect data and publish the industrial reports. In addition to the flour milling, and dry and wet alcohol milling sectors, CAIR surveys will also result in reports on the cotton, and fats and oilseeds industries. This information may be valuable to ethanol and biodiesel producers.

“As soon as the Census Bureau announced they were discontinuing the Current Industrial Reports, we began hearing from agriculture stakeholders around the country about the impact this decision had on the industry,” said NASS Administrator Joseph T. Reilly. “These reports are such an important element of sound economic policy planning and are used for market analysis, forecasting, and decision making that we knew we had to provide the data and I’m glad that beginning this year NASS is able to do just that.”

To prepare for the program launch, NASS conducted extensive work building up baseline profiles for the industries. On the ethanol production side, the agency will work with 200 facilities, with a reported nameplate capacity of 14.792 billion gallons per year. On the flour milling side, NASS plans to survey 183 facilities, which have a reported 24-hour milling capacity of 1,594,755 hundredweight.

NASS has a long history of collecting and publishing agriculture data. As is the case with all NASS surveys, information provided by respondents is confidential.