USDA has increased its estimate of the corn crop again this month, building on already forecast record highs. Corn production is forecast at 14.4 billion bushels, up 3 percent from both the August forecast and from 2013 and yields are expected to average 171.7 bushels per acre, almost 13 bushels an acre higher than last year.
“It will be the fifth record crop that we’ve had in the last 12 years,” says National Corn Growers Association Vice President of Public Policy Jon Doggett, who commented on the crop during a during a Fuels America press call Thursday discussing the importance of EPA keeping the ethanol requirements under the Renewable Fuel Standard (RFS) going forward. “When the energy bill was passed in 2008, there was a challenge to the corn industry to produce the corn, and we have produced the corn,” he said, adding that farmers have done it so well that prices have fallen back below cost of production.
As harvest ramps up in fields across the country, corn demand from the ethanol sector is ramping up as well. Dinneen notes that DOE projects 2014 ethanol production will be 14.3 billion gallons. “A decade ago, who would have dreamed that 14 billion bushels of corn and 14 billion gallons of clean-burning, domestically-produced ethanol would be the reality in 2014?,” he said.
Dinneen added that EPA’s proposal to reduce the 2014 RFS requirement for “renewable fuel” from 14.4 billion gallons to 13.01 billion gallons would effectively reduce demand for corn by some 500 million bushels, at a time when corn stocks are rising and prices are slumping to levels below the cost of production. “Now is not the time to artificially constrain demand for corn and tie the hands of the American farmer,” Dinneen said, urging EPA to “finalize a rule that returns the RFS to its intended trajectory.”
“This represents a huge step forward in the development of clean, renewable, job-creating American fuels,” Vilsack said during a speech at the National Clean Energy Conference. “The nation is entering a new energy age that will make us more energy independent, cut carbon pollution and strengthen our economy, especially in rural communities where clean fuels will be produced.”
USDA is awarding Fulcrum a $105 million Biorefinery Assistance Program loan guarantee through Bank of America, N.A. to construct a facility in McCarran, Nev., to convert municipal solid waste to biodiesel jet fuel. USDA Rural Development’s loan guarantee represents less than half of the $266 million project cost. The plant is expected to produce 11 million gallons of fuel annually.
This is the first loan guarantee USDA has made for the production of bio jet fuel.
Researchers working for the U.S. Department of Agriculture (USDA) have developed a variety of switchgrass that produces bigger yields and more biofuel. Rob Mitchell with the USDA’s Agricultural Research Service in Nebraska gives credit to retired geneticist Ken Vogel who developed the Liberty variety of switchgrass.
“He was able to identify an upland type and a lowland type that had similar genetics so they were able to be crossed. He made greenhouse crosses and then took those crosses to the field and right away saw a real big increase in biomass production,” Vogel says.
Field testers in Nebraska and Wisconsin noticed that not only were they getting more biomass, but they were also getting more biofuel out of the biomass produced, in addition to good stand establishment and winter survivability… key points for the Upper Midwest where Mitchell expects the Liberty variety to be grown for biofuels.
“I anticipate that Liberty is going to be at its best in that Central Plains and Midwestern region. It probably won’t go much further south, because they really don’t deal with winter hardiness issues in the southern U.S. like we do in the Central Great Plains and the Midwest,” he said.
USDA Rural Development Energy Coordinator Ron Omann says an additional 50-million dollars of mandatory funding and up to 20-million dollars of discretionary funding have been dedicated to REAP for fiscal years 2014 through 2018, and funding for this year and next are being combined. “We’re going to be putting both ’14 and ’15 monies together which amounts to $100 million total for projects,” said Omann. That includes funding for both the Renewable Energy System and Energy Efficiency Improvement Guaranteed Loan and Grant Program and the Energy Audit and Renewable Energy Development Assistance Grant Program.
Omann says they are working to simplify the application process. “Generally, we want to streamline it and make it less of a barrier to get into it,” he said, adding that they are implementing specific changes in the application process for projects of less than $80,000.
For those interested in applying for REAP funding, Omann says each state has its own template to help with the application process, but it helps to keep it small and simple.
Find out more about REAP here.
U.S. farmers are expected to produce more corn than last year, according to the latest USDA report out today.
The August Crop Production report finds that good growing conditions are expected to help growers bring in a record-high crop at 14.0 billion bushels of corn, up 1 percent from 2013 which was also a record at the time. Yields are expected to average 167.4 bushels per acre, which would be the highest yield ever for the United States. Objective yield data indicate the greatest number of ears on record for the ten largest corn producing states.
Due to the increased production, the average farm price was lowered a dime from its July estimate, to a range of $3.55 to $4.25 per bushel, which National Corn Growers Association President Martin Barbre says makes it important to keep demand moving forward. “Now is not the time for our federal policymakers to be cutting into the ethanol standard, imposing undue regulations or going slow on trade agreements,” said NCGA President Martin Barbre. “Our farmers are doing their part, working hard and smart on their farms to bring in a good crop. It’s time Washington removed obstacles and cleared a path so we can sell America’s biggest and most versatile crop at a good and fair price.”
The new World Agricultural Supply and Demand Estimate projects ending corn stocks to be 1.808 billion bushels, up 7 million bushels from July and the highest level of carryover stocks since 2005. “It is clear from this report that the food versus fuel debate over the U.S. renewable fuel policy can be put to bed,” said Growth Energy CEO Tom Buis. “It is time to stop attacking a homegrown American industry that is creating jobs, improving our environment and mitigating climate change, all while decreasing out dependence on foreign oil and fossil fuels. It is time that the facts, not rhetoric drive the debate and today’s WASDE report should finally end these ridiculous claims. This report makes clear that the American farmer can fuel America and feed the world.”
“We’ve been working since late March, early April to determine which markets we’re going to do market assessments in and then next year we’ll shift into market development activities,” said Ashley Kongs, USGC manager of ethanol export program. The Grains Council is planning three regional market assessment programs this year, going to Japan and Korea in September, Latin America in November, and southeast Asia in early December.
Earlier this year, USGC participated in a trade mission to China with USDA Undersecretary Michael Scuse where they were able to discuss the possibility of ethanol exports to that country. “They visited with a Chinese ethanol plant and they had meetings with the National Energy Administration in China,” said Kongs. “Currently ethanol can only be sold in six designated markets in China for blending with fuel, but the group had discussions about the possibility of expanding ethanol use nationwide.” Kongs says while there are challenges in the Chinese market, the Grains Council sees great potential for the future to open the door for U.S. ethanol exports.
USGC continues to build on its success in promoting exports of the ethanol co-product distillers grains and will be again this year joining RFA in hosting the Export Exchange, an international trade conference focused on the export of U.S. coarse grains and ethanol co-products held every two years. Early registration for the event is open until July 31 and USGC and RFA members are eligible for discounted pricing.
Rural energy projects from wood on the land where it’s grown are getting a boost. The U.S. Department of Agriculture (USDA) awarded more than $2.5 million in grants to develop wood energy teams in 11 states and an additional $1.25 million for nine wood energy projects.
“Renewable wood energy is part of the Obama Administration’s ‘all of the above’ energy strategy,” [Agriculture Secretary Tom] Vilsack said. “Working with our partners, the Forest Service is supporting development of wood energy projects that promote sound forest management, expand regional economies and create new rural jobs.”
The federal funds will leverage more than $4.5 million in investments from USDA partners. Under the terms of the agreements announced today, private, state and federal organizations will work together to stimulate the development of additional wood energy projects in their states. Activities may include workshops that provide technical, financial and environmental information, preliminary engineering assessments and community outreach needed to support development of wood energy projects.
Grant recipients are from: Arizona, Colorado, Kentucky, Montana, New Mexico, New York, Oregon, Vermont, Washington, Wisconsin and West Virginia.
Biomass producers and energy facilities can soon apply for assistance to turn renewable biomass materials into clean energy under the Biomass Crop Assistance Program (BCAP) reauthorized by the 2014 Farm Bill.
The Farm Bill authorizes $25 million annually for BCAP, requiring between 10 and 50 percent of the total funding to be used for harvest and transportation of biomass residues. Traditional food and feed crops are ineligible for assistance. The 2014 Farm Bill also enacted several modifications for BCAP, including higher incentives for socially disadvantaged farmers and ranchers, and narrower biomass qualifications for matching payments, among other changes.
Farm Service Agency Administrator Juan Garcia says the initiative helps farmers and ranchers manage the financial risk of growing and harvesting energy biomass at commercial scale. “Investing in agricultural and forestry producers who cultivate energy biomass and supporting next-generation biofuels facilities make America more energy independent, help combat climate change and create jobs in rural America.”
“The potential to achieve transformational progress on biomass energy in rural America and generate tremendous economic opportunities is very promising,” added Garcia. “Energy crops occupy the space between production and conservation, providing opportunities for marginal land, crop diversity and more energy feedstock choices.”
The USDA Farm Service Agency (FSA), which administers BCAP, will coordinate BCAP enrollments. Information on funding availability will be published in an upcoming Federal Register notice.
U.S. Department of Agriculture (USDA) Under Secretary for Farm and Foreign Agricultural Services Michael Scuse led a mission to promote U.S. agricultural exports in northeast China May 5-13. The mission is part of President Obama’s “Made in Rural America” export and investment initiative, designed to help rural businesses and leaders take advantage of new investment opportunities and access new customers and markets abroad.
During a press conference Tuesday to talk about the trade mission, Davis said it was her first trip to China and she was astounded by the number of cars on the roads and sees a great need for both biofuels and distillers grains for livestock feed in that country. Miller added that China provides an excellent market opportunity for the U.S. ethanol industry.
Corn production is projected at 13.9 billion bushels, up slightly from the 2013/14 record with higher expected yields more than offsetting the year-to-year reduction in planted area. The corn yield is projected at 165.3 bushels per acre, up 6.5 bushels from 2013/14, based on a weather adjusted yield trend model and assuming normal mid-May planting progress and summer weather.
Farm organizations welcomed the news but sounded a note of caution.
“America’s corn farmers continuously strive to improve and, in 2014, they certainly will make their achievements evident should these projections be realized,” said National Corn Growers Association Chairwoman Pam Johnson. “As farmers, we take great pride in our work and feel that the projections recognize our efforts. Yet, our optimism is tinged caution as we have all seen conditions change quickly and a crop shift course in a few short weeks.”
“Farmers are still out there facing the reality of unpredictable weather as they work to get their crops in the ground, favorable weather during the growing season and then cooperative weather again at harvest time,” added American Farm Bureau Federation crops economist Todd Davis. “There’s still a long way to go before the crops are in the bin.”
The USDA World Agricultural Supply and Demand estimate projects U.S. corn use for 2014/15 will be two percent lower than in 2013/14, while corn used to produce ethanol in 2014/15 is expected to be unchanged on the year with gasoline consumption expected to remain flat in 2015.
During a meeting with members of the National Association of Farm Broadcasting on Tuesday, Agriculture Secretary Tom Vilsack had strong words for the oil industry and its attacks on the Renewable Fuel Standard (RFS).
“The oil industry has made a concerted, organized, well-financed attack on the Renewable Fuel Standard,” said Vilsack when asked about the EPA’s proposal to lower volume requirements for the RFS. “A lot of focus has been on the EPA and the administration, but it is the oil industry that has gone to court to try to limit the impact of the RFS. It is the oil industry that has gone to Capitol Hill to try to insert in appropriations bills and other bills an elimination or curtailment or restriction of the Renewable Fuel Standard.”
“It’s the oil industry working in concert with others that’s made it very difficult to expand higher blend availability,” the secretary continued. “So, what the EPA is doing I think is responding to the need to make sure that there is a strong, defensible RFS.” Vilsack says USDA shares that desire with the EPA. “Because there is no question there is a concerted attack and it is well-financed – and there is no question where the money is coming from.”
The 2012 Census of Agriculture shows a doubling of on-farm renewable energy production since 2007.
According to the census data released by USDA today, there were 57,299 farms that produced on-farm renewable energy in 2012, more than double the 23,451 in 2007. By far the biggest was solar panels, used on over 36,000 farms. Geoexchange systems and wind turbines each were used on more than 9,000 farms.
For renewable fuels, biodiesel was produced on 4,099 farms and ethanol on 2,397. Small hydro systems were used on about 1300 farms and methane digesters on 537.
The census reveals there are now 3.28 million farmers operating 2.1 million farms on 914.5 million acres of farmland across the United States. Those numbers are all lower than 2007 when the census reported 3.18 million farmers, 2.2 million farms and 922 million acres. The top 5 states for agricultural sales were California ($42.6 billion); Iowa ($30.8 billion); Texas ($25.4 billion); Nebraska ($23.1 billion); and Minnesota ($21.3 billion). Corn and soybean acres topped 50 percent of all harvested acres for the first time.
Two federal agencies joined the biofuels industry last week in seriously questioning the results of a University of Nebraska study that claims negative greenhouse gas emissions impacts in using corn stover for ethanol production.
A statement by U.S. Environmental Protection Agency spokeswoman Liz Purchia about the report noted problems with “hypothetical assumption that 100 percent of corn stover in a field is harvested” which she calls “an extremely unlikely scenario that is inconsistent with recommended agricultural practices. As such, it does not provide useful information relevant to the lifecycle GHG emissions from corn stover ethanol. EPA’s lifecycle analysis assumes up to 50 percent corn stover harvest. EPA selected this assumption based on data in the literature and in consultation with agronomy experts at USDA to reflect current agricultural practices.”
During a forum on climate change right after the study hit the headlines last week, Agriculture Secretary Tom Vilsack also pointed out that it is based on a false premise. “The study started with an assumption about the way corn stover would be removed from the land. The problem with the assumption is no farmer in the country would actually take that much crop residue,” Vilsack said. “It’s not what’s happening on the ground. If you make the wrong assumption, you’re going to come up with the wrong conclusions.”
Work done by Dr. Douglas Karlen with the USDA Agricultural Research Service was cited several times in the UNL study. In response to questions from POET-DSM, which is using corn stover as feedstock at a plant in Iowa, Karlen said the study “makes unrealistic assumptions and uses citations out of context to reinforce the authors’ viewpoint.”
According to Dr. Karlen, the research fails to differentiate between responsible biomass removal and “excessive” biomass removal, projecting a removal rate of approximately 75% across the entire Corn Belt.
“Harvesting 75% of all corn stover produced in the 10 Corn Belt states is unrealistic, far greater than any projections made by the U.S. Department of Energy (DOE) in their projections for developing a sustainable bioenergy industry, and would certainly result in the depletion of soil organic matter.”
U.S.Department of Agriculture (USDA) researchers are getting closer to developing a system that will help farmers make their own energy on the farm or produce biofuels for commercial purposes. This article from the USDA’s Agricultural Research Service (ARS) says scientists have found a way to simplify the pyrolysis processes for bio-oil.
These findings by ARS scientists Charles Mullen and Akwasi Boateng promote the USDA priority of finding new bioenergy sources.
Fast pyrolysis is the process of rapidly heating biomass from wood, plants and other carbon-based materials at high temperatures without oxygen. Using pyrolysis to break down tough feedstocks produces three things: biochar, a gas, and bio-oils that are refined to make “green” gasoline.
The bio-oils are high in oxygen, making them acidic and unstable, but the oxygen can be removed by adding catalysts during pyrolysis. Although this adds to production costs and complicates the process, the resulting bio-oil is more suitable for use in existing energy infrastructure systems as a “drop-in” transportation fuel that can be used as a substitute for conventional fuels.
The article goes on to point out that bio-oils made from oak and switchgrass by the new process had considerably higher energy content than those produced by conventional fast pyrolysis. Oak bio-oil’s energy content was about one-third higher and contained about two-thirds of the energy contained in gasoline. Switchgrass did even better with an energy content that was 42 percent higher, slightly less than three-fourths of the energy content of gasoline.
In honor of Earth Day today, the U.S. Forest Service is seeking proposals that expand wood energy use and support responsible forest management. This news release says the service is also offering a Wood Energy Financial App to help business leaders see a positive bottom line for these efforts.
“USDA through the Forest Service is supporting development of wood energy projects that promote sound forest management, expand regional economies, and create new jobs,” said Agriculture Secretary Tom Vilsack. “These efforts, part of the Obama Administration’s ‘all of the above’ energy strategy, create opportunities for wood energy products to enter the marketplace.”
“Building stronger markets for innovative wood products supports sustainable forestry, reduces wildfire risk, and creates energy savings for rural America,” said Forest Service Chief Tom Tidwell.
Under the Forest Service’s Wood-to-Energy Grant program, about $2.8 million will be made available to help successful applicants complete the engineering design work needed to apply for public or private loans for construction and long-term financing of wood energy facilities. Another $1.7 million from the Statewide Wood Energy Team cooperative agreement program will help public-private teams make advancements in wood energy.
The Wood Energy Financial App that allows users to do a simple and quick analysis to see if wood energy is a viable alternative for their community or small business. You can dowmload the app here.