Domestic Fuel

During the recent 2012 Export Exchange a few key leaders in the international market took the stage in a panel to share their perception on United States competitiveness in grain production.

Adel Yusupov, Southeast Asia Regional Director for US Grains Council, served as the moderator for the panel.

Panelists consisted of:
Willis Wu-Yeh Cheng, Chairman, Charoen Pokphand (Taiwan)
Mousa Wakila, General Manager, National Poultry Al Ahlieh (Jordan)
Jamie Rueda, General Manager, Escala (Colombia)
Dennis Inman, Vice President & Commercial Lead, Cargill, Inc.

The panelists were asked to share their candid thoughts on how the United States ranks in grain production and what attributes are most important to them when buying grain. Prices were at the top of all their lists, but they also want reliable market research and stressed that logistics were always a concern. Other items on the list included: consistency, a strong relationship and predictability.

Listen to the International Panel’s presentation here: International Panel at Export Exchange

You can find photos from this years Export Exchange here: 2012 Export Exchange

Widex, a Danish hearing-aid manufacturer, is the first company in the world to receive the recently established WindMade designation, a new global consumer label for companies that use wind energy.

The WindMade label requires participating companies to obtain at least 25 percent of their electricity from wind power. A wind turbine at Widex’ new global headquarters in Denmark covers 95 percent of its energy needs, including production, the company says.

The WindMade label was created to allow companies to communicate their commitment to renewable energy while providing consumers with the choice to favour companies and products using wind power.

“We congratulate Widex for becoming the first-ever WindMade-certified company,” says Henrik Kuffner, CEO of WindMade. “By committing to renewable energy and using the WindMade label, Widex has set a great example that will inspire companies and consumers all over the world.”

“Being a high tech company, we have an uncompromising approach to innovation and we always strive to find the best solution. By completely eliminating the use of fossil fuels, we believe that we have created the best possible foundation for the future – both for our company and for society,” says Richard Tøpholm, manager at Widex and member of the Board.

Other major companies – including Becton Dickinson, Motorola, Deutsche Bank and PricewaterhouseCoopers Denmark – have expressed their commitment to the initiative and will be certified in the coming months.

A 95-year-old graphite company is reaching out to let more industries know about the advantages of their dry film lubricants.

SLIP Plate is a Superior Graphite product that was developed in 1975 for the railroad industry as a natural lubricant that would stand up to weather and other environmental conditions. The dry film coating was not affected by temperature extremes, and did not attract dirt, grit, ice, water or snow. Additional SLIP Plate formulations were developed to meet the needs of the railroads, along with agricultural, industrial and consumer uses. The company’s slogan is “If it needs to slide, roll, turn, twist or spin – it’s a job for SLIP Plate®!”

One product specifically created for the agriculture market is Seed SLIK which has been engineered to reduce seed binding and bridging in planter hoppers and lubricate the mechanical parts of the planter without hurting the seeds. Barry Lee, Product Manager Coatings & Lubricants for Superior Graphite, says they are working to re-introduce the agricultural market to SLIP Plate and one of the ways they’re doing this is with the launch of the SLIP Plate® Facebook Sweepstakes.

SLIP Plate® Facebook Sweepstakes Want a chance to win a $100 Visa® Gift Card? Just follow these simple steps: 1) \”Like\” SLIP Plate on Facebook. 2) Enter the contest posted on SLIP Plate\’s Facebook wall. Winners will be chosen randomly by the sweepstake\’s host application, Easypromos, and will be notified via email. 2nd place and 3rd place entries selected will win SLIP Plate product (retail value up to $50.00). Contest ends: June 13, 2012. We thank you for your business and wish you good luck!

Listen to an interview with Barry Lee, Product Manager Coatings & Lubricants for Superior Graphite, here: Interview with Barry Lee

Biodiesel production in Iowa has remained strong during the first quarter of 2012 despite the expiration of the federal biodiesel tax credit. According to figures released by the Iowa Department of Revenue (DOR), 10 Iowa biodiesel plants produced 41.9 million gallons from January through March.

In 2011, the Iowa Legislature enacted a short-term, modest biodiesel production tax credit to help Iowa’s biodiesel community compete against states that provide large biodiesel incentives. The Iowa program went into effect on January 1, 2012 – the same day the federal biodiesel program expired.

“Despite losing the federal tax credit, biodiesel production in Iowa remains on pace with 2011 production, although down from year-end levels,” said Iowa Renewable Fuels Association (IRFA) Executive Director Monte Shaw. “This is a clear sign that Iowa’s new biodiesel production tax credit is having a positive impact. With additional production set to come on line in Iowa, we hope to see these numbers increase throughout the year.

“We knew there would be a transition period in 2012 and it was important to give the 7,000-plus jobs tied to Iowa biodiesel production a chance to survive and thrive,” added Shaw. “The initial DOR biodiesel numbers are a sign Iowa is headed in the right direction. Tax credits are only earned if biodiesel is produced –meaning jobs are sustained and the economy is strengthened.”

A study released earlier this year by economist John Urbanchuk, technical director of Cardno ENTRIX, found that biodiesel production supported 7,350 Iowa jobs; boosted Iowa GDP by nearly $600 million and generated $350 million in additional Iowa household income.

For more details, read the complete study.
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U.S. biodiesel production has dropped from the late 2011 records when the industry exceeded 100 million gallons per month for five consecutive months and reached a peak of 160 million gallons in December.

Still, 135 million gallons of biodiesel were produced in January and February of this year according to figures released by the EPA, an increase over the same months last year when production totaled less than 80 million gallons.

The drop-off reflects lost momentum since Congress has allowed the biodiesel tax incentive to expire and the Obama Administration delayed finalizing next year’s biodiesel volume requirement under the Renewable Fuel Standard, according to Anne Steckel, vice president of federal affairs for the National Biodiesel Board (NBB).

“These are solid numbers that show the biodiesel industry is on pace to meet the 1 billion gallon RFS requirement this year, but they also reflect some of the missed opportunities for growth and jobs that we’ve seen with the loss of the tax credit and the continued uncertainty about next year’s RFS volume,” Steckel said. “With the tax credit and clear RFS growth in place, we think these numbers would be better.”

Last year, the biodiesel industry produced a record of nearly 1.1 billion gallons, supporting more than 39,000 jobs across the country and helping to reduce U.S. dependence on skyrocketing global petroleum prices.

Ohio-based company, The Andersons, Inc., will aquire an ethanol production facility in Denison, Iowa from Amaizing Energy Denison LLC and Amaizing Energy Holding Company, LLC. The transaction, which remains subject to several contingencies, is anticipated to close in the second quarter.

If acquired, the plant would be owned by The Andersons Denison Ethanol LLC, a wholly-owned subsidiary of The Andersons, Inc. The operations consist of an ethanol facility with an adjacent 2.7 million bushel grain terminal, both with direct access to two Class 1 railroads in Iowa.

“As our first ethanol plant west of the Mississippi, this facility provides us with geographic diversity into some of the best corn ground in the country,” says Neill McKinstray, President, Ethanol Group. “This purchase enables us to expand our ethanol production, marketing and services into a new region providing arbitrage and risk management opportunities with the three existing plants we manage while leveraging existing administrative staff to a fourth plant. With much of the same technology in all four plants, we expect to bring additional efficiencies to drive down our cost per gallon, and maximize returns to shareholders as we have successfully demonstrated during the past five years.”

CEO Mike Anderson, adds, “This is a well-respected, well-run organization that brings with it a solid customer base in a geographic area that we are looking forward to serving. This ethanol facility enables us to offer our grain marketing expertise and the associated services to grain producers in Iowa and fits well with our existing presence as an investor in the Iowa Northern Railway Company and our merchandising relationship with Lansing Trade Group.”

Sam Cogdill, Chairman and CEO of Amaizing Energy, says the proposed sale will address the liquidity concerns of Amaizing Energy’s membership, while retaining the economic benefits the Denison facility has in the local area.

“Our investors were committed to Amaizing Energy to earn a good return on their investment and to further local economic development and we feel great about having met both of those goals,” said Cogdill. “Placing Amaizing Energy on the market while it was a profitable operation has allowed it to reach a fair deal with a great company who we know will operate our plant properly.”

Two key programs that will encourage the use of renewable biomass and production of advanced biofuels is available through the FY 2012 USDA budget, according to the Agriculture Secretary Tom Vilsack. About $25 million will be made available through each program.

First, the Repowering Assistance Program provides approximately $25 million in funding to biorefineries that have been in existence on or before June 18, 2008. The purpose of the program is to provide a financial incentive to biorefineries to use renewable biomass in place of fossil fuels used to produce heat or power. By providing this assistance, USDA is helping these facilities install new systems that use renewable biomass.

Eligible costs must be related to construction or repowering improvements, such as engineering design, equipment installation and professional fees. The application deadline for this program to receive funds for Fiscal Year 2012 is June 1, 2012. For additional details, please see pages 5232 through 5234 of the February 2, 2012, Federal Register.

Second, USDA also announced the availability of up to $25 million to make payments to advanced biofuels producers who expect to produce eligible advanced biofuels at any time during Fiscal Year 2012. To be eligible for these funds, an advanced biofuels producers must have enrolled in the program by October 31, 2011, even if the producer has an existing contract with the Agency.

Payments will be made to producers of advanced biofuels derived from renewable biomass, other than corn kernel starch. These include cellulose, sugar and starch, crop residue, vegetative waste material, animal waste, food and yard waste, vegetable oil, animal fat, and biogas.

Contract payments will be made quarterly. For additional details, please see pages 5229 through 5232 of the February 2, 2012, Federal Register.

“President Obama has laid out a new era for American energy—an economy fueled by homegrown and alternative energy sources that will be designed and produced by American workers,” said Vilsack. “These programs support that vision by helping biorefineries use renewable biomass as a replacement fuel source for fossil fuels and supporting advanced biofuel producers as they expand production.”

Ethanol sales from Nebraska have officially reached 10 billion gallons, according to the Nebraska Ethanol Board. The history making tank-full was pumped in late 2011, after 34 years of ethanol being sold in the state.

2012 projections show that Nebraska drivers could purchase close to seven hundred million more gallons this year. Last year, production from the state’s 25 ethanol plants topped 1.9 billion gallons according to preliminary data. 91 percent of the state’s production goes to U.S. domestic markets, five percent goes overseas and four percent stays in Nebraska.

According to the Energy Information Administration, 2011 U.S. ethanol production was 14.4 billion gallons. The country’s total annual motor fuel usage is around 134 billion gallons. Ethanol accounts for 10.7 percent of total U.S supply.

“Our persistence paid off,” says Loran Schmit, a former member of the Nebraska Legislature who laid the groundwork for the development of Nebraska’s ethanol industry. “Ethanol is a major boost to our economy. Continued expansion of the industry will provide greater benefits for agriculture and energy security.”

Sign up for the Nebraska Ethanol Board’s FFV club for updates of new E85 locations and other announcements.

2010 was a tough year for Iowa’s biodiesel producers, but the industry roared back to life in 2011 and set a new production record.

According to the Iowa Renewable Fuels Association (IRFA), ten of Iowa’s 13 biodiesel plants operated during 2011 and produced a combined 169 million gallons. With plants restarting throughout the year, the rate of biodiesel production in December reached over 250 million gallons (annualized).

Iowa produced 48 million gallons of biodiesel in 2010. The previous record production was 85 million gallons in 2009.

“2011 has been a banner year for Iowa biodiesel,” said IRFA Executive Director Monte Shaw. “The reinstatement of the biodiesel tax credit combined with the renewable fuels standard (RFS) helped demand and Iowa was quick to respond. Yet challenges remain in front of us. Congress will once again allow the biodiesel tax credit to lapse at the end of 2011. With the RFS firmly in place, we do not expect the industry to completely shut down as it did in 2010. But the uncertainty of reinstatement will undoubtedly depress demand. Congress must act quickly in 2012 to extend the tax credit.”

Nearly 108 million gallons of biomass-based diesel were sold during the month of November, continuing a record year of production, according to figures released by the EPA. Biodiesel makes up the vast majority of the EPA’s biomass-based diesel category under the Renewable Fuel Standard program, representing about 95 percent of the volume this year.
In a news release from the National Biodiesel Board, biodiesel production specifically had reached an all-time high 908 million gallons through the end of November. The previous annual record for biodiesel production was 690 million gallons in 2008.

Biodiesel is produced in nearly every state in the country and is on pace to support more than 39,000 U.S. jobs in 2011 while replacing roughly 1 billion gallons of petroleum diesel. Made from an increasingly diverse mix of resources such as agricultural oils, recycled cooking oil and animal fats, it is the first and only commercial-scale fuel produced across the U.S. to meet the EPA’s definition as an advanced biofuel. Biodiesel can be used in existing diesel engines and meets strict specifications of ASTM D6751.

Iowa’s ethanol production increased slightly this year; however, the rate of annual growth slowed as the domestic E10 market became saturated, according to the Iowa Renewable Fuels Association.

Iowa has 41 ethanol refineries that produced 3.7 billion gallons in 2011, up from 3.5 billion gallons in 2010.  This represents 27 percent of the estimated 13.8 billion gallons of nationwide ethanol production.

“2011 was certainly a good year for Iowa ethanol producers with increased production and profitability,” said IRFA Executive Director Monte Shaw. “However, we relied on export markets for growth. We’re also facing the expiration of ethanol’s tax credit. Those factors place a premium on pushing the rapid commercialization of E15. Higher blends like E15 are the only way to guarantee increased ethanol production in the future and the jobs and foreign oil displacement that comes with it. We are waiting for final federal approvals, but Iowa will be a leader in E15.”

As we’ve reported before, Biodiesel Analytical Solutions is teaming up with Mcgyan Biodiesel. I learned more about this at the recent National Biodiesel Conference when I spoke with David Wendorf, Mcgyan Director of Marketing. He’s seen here in their booth.

David says Mcgyan was formed about 6 months ago as the company to license their new biodiesel technology. It’s a process that uses a fixed bed catalyst using metal oxide to produce biodiesel. They can use all types of feedstock. That makes them flexible and able to choose the least expensive feedstock available. Feedstock is the most expensive component of the production process. He says they started out a couple years ago after discovering the process. Since then they’ve been scaling up to what is now a large size production facility. He says the plant is performing beyond their expectations.

You can listen to my interview with David here:

Podcast: Play in new window | Download (2.1MB)

Ethanol plants are cool in a lot of ways. They’re producing a domestic fuel solution to our energy problems and that lessens our dependency on foreign oil for example.

But they can also make a pretty picture too. I was driving south through Missouri last night and passed through Laddonia and the POET plant there.

This was a handheld snapshot from the highway (not much traffic at the time I was passing by).

Doubts about commercial opportunities for cellulosic ethanol are evaporating:

“It is no longer a question of if we are able to produce cellulosic ethanol, but when,” POET CEO Jeff Broin said.

Jeff announced POET’s commitment to develop a commercial cellulosic ethanol plant in Elmersville, Iowa at the Ethanol Conference and Trade Show in Omaha, Nebraska earlier this month. Construction on what POET is calling “Project Liberty” will begin in 2009 and the company expects the facility to be online by 2011. But, POET promises to have a smaller pilot-scale facility up and running by the end of this year.

Jeff says now is an optimal time to take advantage of cellulosic energy because, as he sees it, the industry has sustained strong progress with investments from private industry and academia:

“The stars are beginning to align for cellulosic ethanol,” Jeff said.

POET’s commercial cellulosic plants will process feed stock corn cobs and corn fiber. But, corn isn’t the only source for cellulosic ethanol production that’s poised to go commercial. Bill Schafer, senior vice president of business development Range Fuels, says his company is investing in processing woody biomass for cellulosic ethanol production in Georgia.

In this DomesticFuel Cast, we hear from Jeff Broin, CEO of POET, and Bill Schafer, senior vice president of business development Range Fuels. Here is the Domestic Fuel Cast #8:
df-podcast-08.mp3

You can also subscribe to the DomesticFuel Cast using the following url/feed link: http://www.zimmcomm.biz/domesticfuel/domestic-fuel-cast.xml.

Podcast: Play in new window | Download (1.4MB)