Domestic Fuel

Americans from the mid-Atlantic to the Northwest will soon be hearing a lot more about the benefits of soy biodiesel.

The United Soybean Board (USB) and soybean checkoff is partnering with nine Clean Cities Coalitions in the 2012 biodiesel and Bioheat® communications program to spread the word about the only commercially available advanced biofuel.

“Clean Cities coalitions are really great organizations,” says Mike Beard, USB director and soybean farmer from Frankfort, Ind. “This program helps them, and it helps us to get the word out about clean, efficient soy biodiesel.”

Clean Cities Coalitions participating in the 2012 reimbursement program include:
• Alabama Clean Fuels Coalition
• Greater Washington Region Clean Cities Coalition
• Iowa Clean Cities
• Kansas City Regional Clean Cities Coalition
• North Dakota Clean Cities
• Triangle Clean Cities Coalition
• Twin Cities Clean Cities Coalition
• Virginia Clean Cities
• Yellowstone-Teton Clean Energy Coalition

Most of the coalitions will also be working with their state soybean checkoff organizations on the promotions. This year, the soybean checkoff committed nearly $200,000 to assist these chapters in communicating the benefits of soy biodiesel and Bioheat through radio public service announcements, outdoor advertising, informational workshops for energy users and distributors, promotional events, and many other activities.

Comparing the life cycle analysis of soy products to petroleum products shows clear environmental advantages on the soybean side.

Early last year, the United Soybean Board released the findings of a life cycle analysis report that compared several different soy-based products with the same products made from petroleum sources, including soy biodiesel. The peer-reviewed study was done by Omni Tech International, a consulting firm specializing in renewable and biobased products. The study included a review of soy-based biofuels, plastics, lubricants and coatings.

Omni Tech consultant Jim Pollack says they found out that soybean yields increase 12% in the last ten years, energy to grow soybeans was down 20%, soybean crushing plants were using 45% less energy to make soybean oil. “When the oil was sent over to the biodiesel plants, they were using 35% less energy,” Pollack said. “So, collectively, all of these improvements have resulted in a very favorable life cycle profile for soy biodiesel.”

Pollack was telling that story at the recent National Association of Farm Broadcasting annual meeting. Listen to my interview with him here: Jim Pollack with Omni Tech International

Iowa’s biodiesel leaders are unveiling new radio ads for Iowa State/Iowa men’s basketball games to promote biodiesel to consumers.

“These radio ads are designed to encourage Iowans to learn more about the industry’s starting line-up of performance, quality, support for Iowa agriculture, green-job creation, as well as price and availability,” said Jon Scharingson, Director, Sales and Marketing at Renewable Energy Group® (REG), part of the group coordinating the ads. “Whether you’re a Hawkeye or a Cyclone, we want Iowa diesel engine operators to ask for biodiesel blends from their local petroleum marketer whether it is at the retail pump or for delivery to their business, fleet, or farm.”

In addition to REG, the radio ads are being sponsored by the Iowa Renewable Fuels Association, the Iowa Soybean Association and the Iowa Biodiesel Board to encourage consumers to ask for biodiesel blends from their local fuel retailer, coop or petroleum marketer. The ads are partially funded by the soybean check-off.

According to the Iowa Department of Weight and Measures, a five percent biodiesel blend (B5) has the same performance and quality attributes as straight diesel fuel. “B5 biodiesel blends can perform in any diesel engine in any season,” said Scharingson. “We urge consumers to ask for this home-grown, Iowa-made fuel from any petroleum marketer in Iowa.”

National Biodiesel Board members this week elected seven returning governing board members and one new member to serve on the leadership committee as part of the organization’s membership meeting in Washington D.C.

Officers elected to lead the board are:
Gary Haer, chairman, Renewable Energy Group, Inc. (Producer)
Ed Ulch, vice chair, Iowa Soybean Board (Farmer)
Ron Marr, secretary, Minnesota Soybean Processors, (Producer)
Jim Conway, treasurer, Griffin Industries (Producer)

Biodiesel board members also voted to fill eight board member spots, which include the officer team and:
Ed Hegland, Minnesota Soybean Research and Promotion Council (Farmer)
Kris Kappenman, Archer Daniels Midland (Producer)
Bob Metz, South Dakota Soybean Research & Promotion council (Farmer)
Robert Stobaugh, Arkansas Soybean Promotion Board (Farmer)

For the fourth year, the United Soybean Board (USB) through the soybean checkoff is joining with U.S. Department of Energy-affiliated Clean Cities to build demand for soy biodiesel and Bioheat® in major urban areas by providing some reimbursement incentive.

The Clean Cities program is a government-industry partnership sponsored by DOE that has more than 90 local chapters across the United States working to reduce petroleum consumption. The checkoff has opened the biodiesel reimbursement application process and encourages Clean Cities chapters to partner with Qualified State Soybean Boards for this project. “Hopefully we’ll see more applications for programs that reach out to potential biofuel users in the commercial area, such as heavy trucks and contractor fleets,” says Mike Beard, USB director and soybean farmer from Frankfort, Ind. “We also want to continue to reach those who make decisions in municipal governments.”

The application period will close November 14. Participating chapters will be selected by USB farmer-leaders. USB has provided up to $150,000 to use toward the funding of these soy biodiesel and Bioheat® communications programs. Selected participants in this reimbursement program will be announced in mid-December.

In addition, USB has a second reimbursement program opened for Clean Cities. This will focus on creating demand for soy-based products, many developed with the help of the soybean checkoff. This program will award three reimbursements for up to $10,000 and four reimbursements for up to $5,000.

An annual scholarship for Minnesota high school seniors has been launched under a new name to honor the memory of a soybean farmer.

This year’s scholarships are given in memory of the late father of Mike Youngerberg, senior director of field services for the Minnesota Soybean Growers Association. Reuben Youngerberg owned a farm in Blue Earth County, where he held a number of board positions in local agriculture organizations.

The Reuben Youngerberg Memorial Biodiesel Scholarship is open to any Minnesota high school senior and offers a $1,600 1st place and $500 2nd place award to the winners of an essay contest about biodiesel, a cleaner-burning alternative fuel produced and used in Minnesota. Rules and an online entry form can be found at www.cleanairchoice.org. Deadline for entries is March 30, 2012.

The scholarship is administered by the American Lung Association in Minnesota, which recognizes biodiesel as a “clean air choice” fuel that reduces emissions, and sponsored by the Minnesota Soybean Research and Promotion Council, with additional support from the Minnesota Soybean Growers Association, National Biodiesel Board, MEG Corp, and Renewable Energy Group, Inc.

Corn stocks and use for ethanol seem to get all the attention when the USDA World Agricultural Supply and Demand Estimates are released each month, but soybean oil use for biodiesel attracting some notice lately.

World Agricultural Outlook Board Chairman Gerry Bange says soybean oil use for biodiesel is up 44% over last year at 3.6 billion pounds. “The EPA has indicated its intention to enforce the billion gallon standard and what we’re seeing is a substantial increase in the amount of soybean oil being used to produce methyl ester, which is another way of saying biodiesel,” he told USDA Radio.

This is resulting in a tightening of ending stocks for soybean oil and higher prices. “What it’s leading to is a continuation of a fairly strong price at 55 cents per pound, compared to 53.2 cents per pound in 2010-11,” he said.

The Renewable Energy Group (REG) just hated to see the 30 million gallon capacity biodiesel plant standing idle near Albert Lea, Minnesota for the past three years, so the company decided to do something about it.

“It’s a great plant that needed to run,” Brad Albin, REG Vice President of Manufacturing, said at the plant’s re-opening on Monday. “It had no where to go but was a jewel just sitting here ready to run.”

REG originally built the plant in 2005 for SoyMor, which ran it for three years before shutting down in 2008. “We’re very lucky to have brought this plant up within about four weeks,” said Albin. “It was actually the largest 30 million gallon plant years ago and what’s great about it is that it’s highly efficient and we’ve already got it up to just about 90% throughput.”

Since Minnesota has a state requirement for biodiesel blends, Albin says it was important to get the plant back on line. “Minnesota is a great user of biodiesel so it was just natural that we build it, we’d run it, get back and get it going again,” he said of the plant which uses soybean oil as its primary feedstock.

Listen to or download interview with Brad Albin here. REG VP Brad Albin

REG Albert Lea Biodiesel Plant Photo Album

The biodiesel tax incentive is helping to create jobs across the country, according to testimony submitted to the House Ways and Means Committee today by the National Biodiesel Board (NBB).

“While we understand the pressures facing Congress, this is the wrong time to pull support from a growing American industry that is a rare bright spot in this economy,” said Anne Steckel, NBB vice president of federal affairs. “Our industry is having a record year of production, and the tax incentive is a key ingredient in that success. Stripping the incentive away this year would put thousands of jobs in jeopardy.”

Steckel’s written testimony was submitted to the committee for a hearing on energy tax policy and tax reform held today that focused on whether energy policy should be conducted through the tax code, and specifically on proposed tax credits for natural gas under the New Alternative Transportation to Give Americans Solutions (NAT GAS) Act of 2011.

While, the biodiesel industry was not called to testify at the hearing, Steckel’s submitted comments highlighted the biodiesel industry’s rebound this year after the biodiesel tax incentive was reinstated following a one-year lapse in 2010 which caused production to drop dramatically last year as dozens of plants shut down and thousands of people lost jobs.

Since its reinstatement this year, the industry had produced roughly 475 million gallons as of July compared with 315 million gallons in all of 2010. This year’s increased production of at least 800 million gallons will support more than 31,000 jobs while generating at least $3 billion in GDP and $628 million in federal, state and local tax revenues, according to a recent economic study conducted by Cardno-Entrix.

“We believe the U.S. biodiesel industry offers a clear and compelling case that strong domestic energy policy can boost this economy,” she said. “Our production turnaround this year is creating good-paying jobs in nearly every state in the country.”

That claim was highlighted with the re-opening of a southern Minnesota biodiesel plant this week. Minnesota soybean farmer Jim Willers said reinstating the biodiesel tax incentive is one of the best jobs creation programs the government has done lately. “This plant’s put almost 25-30 people back to work, there’s usually 50 trucks that go through here and the spin off effect from this plant creates almost 2,000 jobs,” he said. “Between state and local and federal taxes, it’s way more than the tax credit so your return on investment for the government is just terrific with biodiesel.”

At the opening celebration of the Renewable Energy Group (REG) REG Albert Lea facility on Monday, Minnesota state representative Rich Murray (left) and local Chamber of Commerce Executive Director Randy Kehr (right) both congratulated REG president Dan Oh (center) on fueling the economy by creating new jobs.

“They’re great green collar jobs,” said Kehr, who noted the importance of the agriculture industry to the region. “If you take the value-added in soybeans here in Freeborn county on the seven million bushels that were harvested last year, that represents nearly $1,750,000 into our community.”

Listen to the opening ceremony comments here. REG biodiesel plant opening ceremony

Rep. Murray said that job creation is the number one priority for lawmakers. “I’m excited about the jobs, that’s why I’m here today,” he told me. “It’s a great value add for agriculture and agriculture is the back bone of southern Minnesota and of the whole state.”

Minnesota has had an increasing biodiesel blend requirement since 2002, which is slated to go to 20 percent by 2015. “And this plant’s going to help us get there,” said Murray.

Listen to my interview with Rep. Murray here. Minnesota state representative Rich Murray

REG Albert Lea biodiesel plant photo album

Fields of soybeans surround the newly re-opened Renewable Energy Group REG Albert Lea biodiesel plant in southern Minnesota, serving as a reminder of where the renewable fuel is rooted.

Chris Hill, a soybean farmer who serves on the board of the Minnesota Soybean Growers Association and the Minnesota Biodiesel Council, is pleased to see the plant re-open because it really adds value to the soybeans he grows. “The National Biodiesel Board did a study taking into account the benefit of biodiesel, it can add approximately $2 to every bushel from the farm,” said Hill. “On a 500 acre farm, that’s roughly $5000 added income.”

Hill, pictured here on the left with REG president Dan Oh, says the economic benefits of biodiesel production in a rural community have a multiplier effect. “From the farmer, to the elevator to the tire salesman, to the people buying the biodiesel to blend it, for trucks and everything else, it just helps everybody,” Hill said, adding that it helps all of agriculture, including livestock producers who benefit because it helps reduce the cost of soybean meal.

Listen to or download interview with Chris Hill here. Minnesota Farmer Chris Hill

REG Albert Lea biodiesel plant photo album

The Renewable Energy Group (REG) celebrated the official opening of the REG Albert Lea biodiesel plant in Minnesota on Monday, with representatives of the state and local community and agriculture industry.

REG President and COO Dan Oh says they were involved in the construction and operations of the plant when it originally was built and opened by SoyMor. “We have worked together since 2003,” said Oh. The plant unfortunately got caught up in the economic issues that hit the renewable fuels industry back in 2008 and had to shut down, but REG felt it was a significant plant that needed to get back in operation, so they worked to make it happen for the local economy. “Think of a gallon of biodiesel in roughly every bushel of soybeans, this is a 30 million gallon biodiesel facility, so that really adds value back to a bean bushel,” Oh said.

Listen to or download interview with Dan Oh here. REG President Dan Oh

Representatives of the Minnesota soybean industry were on hand today for the grand opening, including Jim Willers, who is a farmer from Beaver Creek and a director on the United Soybean Board, as well as a member of the Minnesota Soybean Research and Promotion Council. After touring the plant, Willers said he was impressed with the shape it is in after being shut down for three years. “I found out that it was in excellent condition when they closed it down and the start up was way better than they thought,” he said. “It’s a state of the art facility and in six months they’re going to be a BQ-9000 plant.”

Listen to or download interview with Jim Willers here. Minnesota soybean farmer Jim Willers

Watch the ribbon cutting below and see photos in the REG Albert Lea biodiesel plant photo album

The Renewable Energy Group (REG) will be celebrating the grand re-opening Monday of a Minnesota biodiesel plant that was shut down for three years.

REG acquired the former SoyMor production facility earlier this year, which is now known as REG Albert Lea, LLC. The company will be celebrating the grand re-opening of the plant with members of the Minnesota Soybean Research and Promotion Council, as well as state and local dignitaries, on Monday morning.

“With nationwide demand for biodiesel growing steadily through implementation of the Renewable Fuels Standard (RFS2) and Minnesota’s continued biodiesel consumption leadership, we expect to quickly ramp up production at REG Albert Lea, LLC,” said REG’s CEO Jeff Stroburg when the purchase of the plant was finalized. “With a foundation in agriculture and expertise in domestically-produced, renewable energy, REG is proud to bring green-collar jobs to this rural economy while supporting ag producers in Minnesota and across the Midwest.”

Minnesota is a leader in the biodiesel industry, being the first state to require that all diesel fuel contain a two percent blend in 2005, and has since increased to a five percent blend. “Increasing the amount of biodiesel in our fuel allows us to take advantage of a renewable fuel made right here in Minnesota,” said Ed Hegland, former National Biodiesel Board Chairman and Minnesota farmer. “I’m proud to live in a state that is leading energy innovations and taking part in valuable solutions like biodiesel.”

REG was already the largest biodiesel producer in the United States and the acquisition of REG Albert Lea brings the REG owned/operated total to more than 210 million gallons per year. REG was the general contractor and manager for the 30 mmgy refined vegetable oil feedstock biodiesel plant which originally began production in April 2005. Distribution of biodiesel at the facility started late last month. REG filed for filed an initial public offering in July.

September is officially Renewable Fuels Month in Nebraska now after a proclamation signing by the governor today at Husker Harvest Days.

Nebraska Governor Dave Heineman joined state soybean board chair Lisa Lunz, NASCAR Nationwide driver Kenny Wallace and Alan Tiemann, chairman of the Nebraska Corn Board, in making the declaration. “Nebraska’s renewable fuels sector contributes to local communities by providing good paying jobs for thousands of Nebraskans,” said Gov. Heineman. “Renewable fuels are a critical component of becoming energy independent and by providing an alternative to imported oil. We are fortunate to have a strong biofuels industry with thousands of Nebraskans working to fuel America.”

The proclamation was coordinated through the Nebraska Corn Board and Nebraska Soybean Board, who hosted the event at Husker Harvest Days to recognize the contributions of Nebraska farmers and agribusinesses to the nation’s renewable fuel supply.

According to Purdue University agricultural economist Chris Hurt, grain crops are being “gobbled up” faster than farmers can grow them. This could lead to trouble down the road if production doesn’t catch up. Hurt says there have been two major demands surges on commodities in the past five years. One is the rising use of corn for ethanol production being driven by biofuel mandates and high oil prices. The second is increased soybean purchases by China being driven by the country’s growing income and food demand.

“These greater levels of usage have placed a strain on the agricultural production system, resulting in low inventories that leave little room for any production shortfalls,” Hurt said. “Producers certainly have responded to try to meet those demands, but what we’ve seen is that demand has really outpaced the ability of the world to supply.”

Hurt said wheat stocks are in better shape than corn and soybeans that are near “bare minimums” in the U.S. In the past, he said there was enough for 46-60 days or more but anticipates that this won’t be the case after this fall’s harvest.

“With corn, it looks like we could be down to about a 24-day supply at the end of this marketing year,” said Hurt. “That, of course, means any further threats to the 2011 crop yields would send markets into deeper shortages and higher prices.”
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