The USDA Planted Acreage report out Monday was good news, although it does not yet reflect the damage from Midwest flooding.
Corn planted area is reported to be 1.31 million acres more than was estimated in the March intentions report at 87.3 million acres, down just 7 percent from last year. That is the second highest since 1946, behind last year’s total of 93.6 million acres. If it were all to make it, growers would harvest 78.9 million acres for grain, down 9 percent from 2007 and the second highest since 1944.
Putting the acreage report in context with respect to America’s ethanol industry, Renewable Fuels Association President Bob Dinneen said it shows how American farmers are capable of meeting the growing demand for feed, food, fiber and fuel.
“This report once again demonstrates that together with agriculture, American ethanol producers can help lead this nation in new, renewable energy direction,” said Dinneen.
National Corn Growers Association chairman Ken McCauley says his corn in Northeast Kansas looks good right now and it’s important to remember that there is plenty of corn being grown outside of Iowa.
“I tell you what, everybody is going to produce some corn,” McCauley said. “Iowa will produce a lot of corn and when you get down to it we’re gonna have a good corn crop and it could even be one of the better one or two or three.”
Louisiana Governor Bobby Jindal this week signed into law the Advanced Biofuel Industry Development Initiative, the most comprehensive and far-reaching state legislation in the nation enacted to develop a statewide advanced biofuel industry. Louisiana is the first state to enact alternative transportation fuel legislation that includes a variable blending pump pilot program and a hydrous ethanol pilot program.
The legislation includes the development of ethanol derived solely from Louisiana harvested crops capable of an annual yield of at least 600 gallons per acre. The law also provides for two pilot programs - an advanced biofuel variable blending pump trial and a hydrous ethanol trial.
Officials with Renergie, Inc. are pleased with passage of the law. Renergie is in the process of developing a network of ten ethanol plants in the parishes of the State of Louisiana. Brian J. Donovan, CEO of Renergie, says the legislation will “maximize rural development, benefit consumers, farmers and gas station owners while also protecting the environment and reducing the burden on local water supplies.” The Florida-based company recently received $1.5 million in grant money to design and build Florida’s first sweet sorghum juice mechanical harvesting system and ethanol plant capable of producing fuel-grade ethanol solely from sweet sorghum juice.
The opening speaker for day two of Farm Foundation’s Transition To A Bio Economy conference is our USDA Under Secretary for Rural Development, Thomas Dorr. He talked about rural policy and we visited for a while before the session got started.
He says that rural policy is more important and timely a topic now than it has ever been, especially as we’re coming off the finalization of the 2008 Farm Bill. Some reasons include the huge growth in the deployment of broadband internet access and the demand for food and energy. With growth in rural communities people are starting to think differently when it comes to policy issues like conservation.
He pointed out that 95 percent of all rural income is off farm and that there haven’t been any new jobs in agriculture in recent years. So he says we need to look at unique uses of local resources for development but that development creates demands on infrastructure like water and sewer. He says that by meeting goals of replacing oil with renewable energy sources we’re creating a significant rural investment opportunity. So the question he poses to communities is “Are they willing to step up?”
Dorr has a long history with the Farm Foundation since he was a member of the round table prior to his appointment in Washington, DC. He also talks about the Foundation’s rural development opportunity tours and one that’s planned for this summer in Europe where he’ll be participating in a farmer to farmer dialogue.
We had USDA Rural Development represented here at the Transition To A Bio Economy conference by Tony Crooks. He works with their rural business cooperatives program and has done a lot of work with communities in the area of ethanol and biodiesel.
The challenge he says we have today in rural communities is the large capital outlay to get a biorefinery started so USDA is looking at creative ways to help them. He highly suggests that a community have a community development plan so they can better decide if a plant would be in their best interest. Ways that USDA Rural Development can help is with grants and guaranteed loans. He says they’re looking for communities who need financial assistance, especially in the second generation cellulosic area.
Sen. Charles Grassley (R-Iowa) renewed his commitment to Congress renewing the biodiesel tax incentive… while he took a shot at the Grocery Manufacturers Association for what he says is a smear campaign by the group against biofuels. Grassley’s comments come on the heels of Tuesday’s vote, when the U.S. Senate came up just eight votes short of cloture to end debate on extending the $1-a-gallon biodiesel tax credit.
Speaking to National Biodiesel Board members at their meeting in Washington, DC today, Grassley stressed just how important biodiesel is for America’s environment, economy and energy security.
“We ought to keep the dollars in the United States rather than send them over to the Arabs to shoot back at us.” In his capacity as the Ranking Member on the Senate Finance Committee, he reiterated his desire to work in a bipartisan manner to pass an extender package that includes the biodiesel tax incentive.
Senator Grassley was also critical of the anti-biofuels public relations campaign that is being waged by the GMA. He noted that only one chief executive officer from the grocery industry, out of 15 invited, has accepted the invitation to meet with him and Agriculture Secretary Ed Schafer to discuss the GMA’s multi-million dollar campaign to discredit biofuels.
“The biggest culprit behind the rising food cost is $135 barrel oil,” he said. “This campaign is led by an organization that should be a loyal member of the food chain. Instead, they are making biofuels the scapegoat to defend their own bottom line. The truth is that America’s family farmers are producing more food, and fuel, than ever before.”
“Lifting the biofuels incentives won’t ease food prices,” Grassley said. “By using less biofuel, we will in fact lift food prices. Who are they trying to kid?”
You may not be familiar with Farm Foundation or this series of programs they’ve been hosting on the subject of a Bio Economy. To learn more myself, I spoke with Foundation Vice President, Steve Halbrook, pictured. He says that Farm Foundation is a non profit organization that works in agricultural and rural policy issues. They bring together industry, government and academic leaders to focus on the challenges facing our food system and rural communities.
Steve says this event will have a special focus on biofuels since it affects all facets of ag and rural areas, especially ethanol in the mid west. He says that leaders from several government agencies, including USDA, approached them hoping that the Foundation could help them better understand this issue.
Nationwide, the average cost of gas has hit a record $4 a gallon, which means some areas, like California, the average price has topped $4.50 a gallon.
But in Missouri, the average price of $3.82 a gallon is the lowest in the nation - in part because of ethanol. The state implemented a ten percent ethanol mandate this year, which a recent economic study said amounted to saving consumers almost 10 cents a gallon at the pump.
And the mandate will stay in place statewide, despite a recent request for a waiver by Kansas City. Missouri Governor Matt Blunt denied that waiver on Friday.
“We have reviewed the request for a waiver of the E-10 standard in the Kansas City area,” Gov. Blunt said. “After thorough consideration of all aspects of this waiver request, I have decided it is in the best interest of the state to not issue the waiver.”
That was good news for Missouri corn growers, who strongly supported the state renewable fuels standard.
“With gasoline prices already soaring, removing ethanol in Kansas City would send prices even higher,” said Missouri Corn Growers Association president Mike Geske. “By denying the waiver, Gov. Blunt is preventing consumers from experiencing additional pain at the pump.”
A bill that would have extended and boosted the producer-incentive tax breaks on a host of alternative energy sources, including wind, solar, biodiesel, clean-coal and other projects to help spur alternative energy development, has been stopped in the U.S. Senate… for the time being.
The measure, sponsored by Sen. Max Baucus (D-Montana), would have extended the $1-a-gallon producer tax incentive for biodiesel but failed when Senate Democrats failed to garner the 60 votes needed to invoke cloture… cutting off debate and allowing a majority vote on the bill. Senate Republicans opposed the measure largely because of some of the tax hikes attached to the bill. But this story from the National Journal says it’s not dead yet:
The measure is in limbo, although Senate Majority Leader Reid can call the bill back up for a vote. Aiding the GOP cause were Democratic absences, including Senate Appropriations Chairman Robert Byrd and Sen. Hillary Rodham Clinton of New York. Those two may be back for votes soon, however, giving Democrats a better chance on a revote as well as giving affected industries more time to lobby. Speaking earlier today at the U.S. Chamber of Commerce, Baucus said he thought cloture could be invoked within a week to 10 days. One lobbyist predicted Republicans would eventually back the bill or risk blame for expiration of the tax breaks, particularly vulnerable incumbents like GOP Sens. John Sununu of New Hampshire and Norm Coleman of Minnesota.
The West Lafayette, Indiana Police Department is trying to help their budget by using E85 in their seven new FFV squad cards. The department reportedly spends between $11K and $12k a month for fuel.
“The price is right now to give it a try,” said Police Chief Jason Dombkowski. “Looks like a dollar savings per gallon. We think we can save up to $1,000 a month on fuel consumption costs.”
Although the department realizes there is less energy in E85 than gasoline (equating to less miles per gallon when using the alternative fuel), they receive a significant discount in the price making it adventageous to purchase E85.
The FFV Ford Crown Victorias will use E85 for 60 days and if they see a cost savings, will consider converting much of their fleet to E85 compatible.
“We are going to try to go straight E85 flex fuel for now and analyze and see how cars are doing for our needs,” said Dombkowski. “At the end of the summer if gas prices are still what they are and we’re getting the results we need we may do some conversion.”
The U.S. Secretaries of Agriculture and Energy sent a letter to Senate Energy and Natural Resources Committee Chairman Jeff Bingaman (D-NM) answering questions about biofuels production and food prices.
In the joint letter, Energy Secretary Samuel Bodman and Agriculture Secretary Ed Schafer noted the complexity of the food and fuel pricing issues and cautioned the senator “against hasty judgments driven by highly questionable, agenda-driven calculations, some of which have been featured prominently in the popular press.”
“It is clear, however, that biofuels are already moderating gasoline prices,” they state in the letter. “That impact is likely to grow substantially as more biofuels come to market.”
The secretaries answered six specific questions related to the production of ethanol and biodiesel and the price of both food and fuel. Regarding food, they responded that biofuels accounted for approximately 3-4 percent of the overall rise in retail food prices domestically and as much as five percent globally. They note the many other factors contributing to higher commodity prices, including increased demand for food; lowered production and reduced stocks due to weather; export restrictions and - record prices for gasoline and diesel fuel that have increased “the costs of producing, transporting, and processing food products.”
As for fuel prices, the secretaries said, “We estimate that, if we had not been blending ethanol into gasoline, gasoline prices would be between 20 cents per gallon to 35 cents per gallon higher.”
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The USDA Planted Acreage report out Monday was good news, although it does not yet reflect the damage from Midwest flooding.
Putting the acreage report in context with respect to America’s ethanol industry, Renewable Fuels Association President Bob Dinneen said it shows how American farmers are capable of meeting the growing demand for feed, food, fiber and fuel. 
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Louisiana Governor Bobby Jindal this week signed into law the Advanced Biofuel Industry Development Initiative, the most comprehensive and far-reaching state legislation in the nation enacted to develop a statewide advanced biofuel industry. Louisiana is the first state to enact alternative transportation fuel legislation that includes a variable blending pump pilot program and a hydrous ethanol pilot program.
The opening speaker for day two of Farm Foundation’s Transition To A Bio Economy conference is our USDA Under Secretary for Rural Development, Thomas Dorr. He talked about rural policy and we visited for a while before the session got started.
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We had USDA Rural Development represented here at the Transition To A Bio Economy conference by Tony Crooks. He works with their rural business cooperatives program and has done a lot of work with communities in the area of ethanol and biodiesel.
Sen. Charles Grassley (R-Iowa) renewed his commitment to Congress renewing the biodiesel tax incentive… while he took a shot at the Grocery Manufacturers Association for what he says is a smear campaign by the group against biofuels. Grassley’s comments come on the heels of Tuesday’s vote, when the U.S. Senate came up just eight votes short of cloture to end debate on extending the $1-a-gallon biodiesel tax credit.
Next week I’ll be attending Farm Foundation’s program titled, 
But in Missouri, the average price of $3.82 a gallon is the lowest in the nation - in part because of ethanol. The state implemented a ten percent ethanol mandate this year, which a 
That was good news for Missouri corn growers, who strongly supported the state renewable fuels standard.
A bill that would have extended and boosted the producer-incentive tax breaks on a host of alternative energy sources, including wind, solar, biodiesel, clean-coal and other projects to help spur alternative energy development, has been stopped in the U.S. Senate… for the time being.
In 
The secretaries answered six specific questions related to the production of ethanol and biodiesel and the price of both food and fuel. Regarding food, they responded that biofuels accounted for approximately 3-4 percent of the overall rise in retail food prices domestically and as much as five percent globally. They note the many other factors contributing to higher commodity prices, including increased demand for food; lowered production and reduced stocks due to weather; export restrictions and - record prices for gasoline and diesel fuel that have increased “the costs of producing, transporting, and processing food products.”