Corn Growers Remain Optimistic

Cindy Zimmerman

Corn growers remain optimistic about the future, despite this year’s drought-devastated crop.

“It could all change tomorrow,” was the theme of National Corn Growers Association (NCGA) CEO Rick Tolman’s talk at the American Coalition for Ethanol conference in Omaha on Friday, just hours after the USDA released a new crop forecast showing a 13% drop in corn production this year compared to last. “This too shall pass,” said Tolman. “We think the future’s going to be bright still.”

“We were hoping for some miracles but they’re not there,” Tolman said in an interview. “It’s one of the worst situations we’ve had in the history of corn production in the United States, but it’s still the eighth largest crop we’ve ever produced.”

NCGA remains committed to maintaining the Renewable Fuel Standard corn ethanol requirement and Tolman said they are working to set the record straight about the RFS and correct misinformation that has been distributed by those who want to waive or dismantle the program. Most important is the inaccurate statement that more corn is used for ethanol than is used for livestock. “That is not true,” said Tolman. “More corn is GROUND for ethanol, but more still is consumed for livestock” when the co-product distillers grains is added to the equation.

Listen to my interview with Tolman at ACE: Interview with NCGA CEO Rick Tolman

Listen to Tolman’s comments at ACE: NCGA CEO Rick Tolman remarks at ACE


2012 ACE Conference Photo Album

ACE, Audio, corn, Ethanol, Ethanol News, NCGA

ACE Gives Sen. Nelson Highest Honor

Cindy Zimmerman

During its 25th annual conference in Omaha Friday, the American Coalition for Ethanol (ACE) presented U.S. Senator Ben Nelson (D-NE) with the Merle Anderson Award for his leadership in supporting the renewable fuels industry while serving as Governor and Senator of Nebraska.

Nelson established the Governors’ Ethanol Coalition in 1991, helped create the first energy title in a farm bill, and played a key role in passing the Renewable Fuels Standard (RFS) in 2005, and the expanded RFS in 2007.

The Merle Anderson Award is named in honor of the founder and first president of ACE who serves as Chairman Emeritus of the ACE board of directors.

The senator, who is retiring this year after serving in the Senate since 2001, was honored by the award named after Anderson. “It’s very heartwarming to be considered in his company,” he said. “I’m just very proud.”

Nelson commented on work not done in Congress on a farm bill, which would include livestock assistance for livestock producers affected by the drought, and why that would help more than waiving the Renewable Fuel Standard. “We don’t want to go backwards trying to go forwards. There are other ways of dealing with this, we don’t have to start changing the RFS,” he said.

Listen to my interview with Sen. Nelson at ACE: Sen. Ben Nelson


2012 ACE Conference Photo Album

ACE, Audio, Ethanol, Ethanol News, Government

RFA Puts USDA Crop Report in Context

Cindy Zimmerman

Renewable Fuels AssociationRenewable Fuels Association Vice President of Research and Analysis Geoff Cooper put together an analysis of today’s USDA crop supply report on the RFA E-xchange Blog to put the report into perspective from both a historical context as well as a global production context, answering calls from some international voices to end global biofuel production.

“As expected, this morning’s supply-demand estimates from USDA showed a big reduction in the size of the 2012 corn crop and average yield. Today’s report estimates average yield at 123.4 bushels per acre (bpa), down nearly 23 bpa from USDA’s July estimate and the lowest yield since 1995. Harvested acres are pegged at 87.4 million, meaning a crop of 10.78 billion bushels (bbu) is expected. This is down more than 2 billion bushels from USDA’s July estimate and would be the smallest crop since 2006. Today’s USDA numbers were slightly worse than expected by analysts; on average, they had expected a crop of 10.97 bbu on a yield of 126.2 bpa. While this year’s harvest will be considerably smaller than initially expected, it is remarkable that farmers are still expected to produce the eighth-largest corn crop on record despite experiencing the worst drought in 50 years and the hottest month of July in recorded history.”

Listen to an interview with Cooper here: RFA's Geoff Cooper on USDA crop forecast

Subscribe to The Ethanol Report with this link.

Audio, corn, Ethanol, Ethanol News, Ethanol Report, RFA, USDA

UN Calls for Easing of U.S. Ethanol Mandates

Joanna Schroeder

The concern over the American drought and the impact that ethanol production is having on corn prices has gone global. Jose Graziano da Silva, the director-general of the UN’s Food and Agricultural Organization, said that the easing of U.S. ethanol mandates could stave off another world food crisis.

In response, the Global Renewable Fuels Alliance  (GRFA) wrote, “While the current drought in the US Midwest has placed tremendous pressure on farmers, any action to reduce or eliminate the RFS would be premature and have immediate consequences in lost jobs and an increased reliance on crude oil imports.”

GRFA cited that the flexibility embedded in the Renewable Fuel Standard (RFS) is an effective way of reducing demand for corn during difficult time. U.S. ethanol production is down nearly 14 percent and refiners are holding an estimated 2.6 billion RFS credits that can be used to meet their compliance requirements.

Total grain output globally is expected to drop by 2.9 percent this year; yet, it is still estimated to be the second largest in history. Estimates show grain ending stocks 4% above the 10 year average.

National Corn Growers Association (NCGA) President Garry Niemeyer thanked farmers for having done so much to increase the corn supply. This year’s corn acres paralleled that in 1937; however, this year with advanced agronomic practices, new seed technologies and improved genetics, corn is able to withstand extreme conditions, such as heat and drought, better than ever before.

.”..we remain hopeful that above average yields in some areas will further augment the crop. At the same time, we recognize that it will not fully cover yield concerns.” Without these advanced technologies, said Niemeyer, the production losses would be much greater.

“As prices and emotions rise, so does the temptation to take action that might actually hurt us all in the long run,” added Niemeyer. “Right now, farmers, ranchers, ethanol producers and much of the country is suffering through this historic drought. Yet, we suffer together. We have all seen our investments, be they of time, hard work or resources, wither under the unrelenting heat. With empathy and a strong spirit of cooperation, we will come through these difficulties stronger for the experience and with renewed vigor to build a brighter future for ourselves, our industry and our country.”

Miscellaneous

Setting the Record Straight On Drought & RFS

Joanna Schroeder

The National Corn Growers Association (NCGA) is setting the record straight on the truth behind what would happen if the Environmental Protection Agency (EPA) allowed a waiver of the Renewable Fuels Standard (RFS2). Garry Niemeyer, NCGA president sent a letter to every member of the House of Representatives along with EPA Administrator Lisa Jackson, that included corrects inaccuracies.

“Unfortunately, the letter sent to EPA Administrator Jackson did not provide accurate information about the amount of corn used to produce ethanol or livestock feed,” Niemeyer stated in the letter. “Furthermore, it lacks a comprehensive description of the “burden of proof” required under the RFS waiver provisions. The letter relies on long discredited claims that opponents of the RFS have continued to reference in their on-going efforts to repeal the RFS.”

One of the pieces of misinformation according to Niemeyer is that research has shown that increased worldwide demand and the rising cost of oil and other inputs have had a much greater effect on the price of corn than the ethanol required by the RFS. NCGA believes it is premature for the EPA to waive the RFS at this point and until the harvest numbers are final, it is too early to determine how much corn will be available.

“It is important to remember that a Congressional majority wisely passed a renewable fuel standard that would work in both good and bad crop years,” Niemeyer said. “NCGA urges you to consider the benefits of the RFS to rural America, American energy security and the American farmer.”

Neimeyer also encouraged members of Congress to visit with farmers and community leaders to learn more about the important role they play for America.

Agribusiness, biofuels, corn, Ethanol, NCGA

Ag Secy Vilsack Stresses Support of RFS

Cindy Zimmerman

Agriculture Secretary Tom Vilsack demonstrated his strong commitment to the ethanol industry and the Renewable Fuel Standard (RFS) by spending over an hour at the American Coalition for Ethanol (ACE) conference on Friday morning.

“This is an industry that is worth supporting,” he told the crowd of about 250 ethanol industry leaders. “Which is why the president is supporting the Renewable Fuel Standard, and it’s why I’m supporting the Renewable Fuel Standard.”

In light of the lowered crop forecast for corn due to the drought, Vilsack noted that the RFS has built-in flexibilities and the market is responding as it should. “The market responds, the market reacts, the market pays attention, and we’re already seeing that,” he said.

Vilsack stressed the need for the industry to defend itself in the face of attacks by critics.

Listen to Vilsack’s remarks here: Secy Vilsack at ACE


2012 ACE Conference Photo Album

ACE, Audio, Ethanol, Ethanol News, RFS, USDA

Ethanol Producers: Report Doesn’t Justify RFS Waiver

John Davis

Today’s USDA crop report shows the nation’s corn crop will be down 13 percent from last year’s numbers. But the country’s ethanol producers say that should not justify any waiving of the Renewable Fuels Standard. Both the Renewable Fuels Association and Growth Energy put out statements this morning right after the report came out, and the RFA says we already knew the drought would take its toll on the crop:

“What this report does not do is provide justification for waiving the Renewable Fuel Standard for the rest of 2012. Given the abundance of RFS credits, ample ethanol stocks, and various other flexibilities, obligated parties under the RFS will have every opportunity to demonstrate compliance this year.”

RFA officials plan to hold a webinar next week to outline the report’s impact on U.S. ethanol production. Meanwhile, Tom Buis CEO of Growth Energy echoed RFA’s statement that we knew the drought would have an impact but predicted a big enough crop to meet demand:

“We will have enough corn – in fact, USDA’s report demonstrates how the market is already working to cut demand as they actually increased available corn stocks at the end of the year – showing over one billion bushels of corn surplus. Ethanol production is already down 15 percent in the last month alone. Any attempt to change the Renewable Fuel Standard, our nation’s successful biofuel policy would simply be a knee-jerk reaction to the benefit of Big Oil. The current policy has flexibility built in for exactly these types of situations.”

corn, Ethanol, Ethanol News

Corn & Soybeans Down in USDA Report

John Davis

The drought is certainly taking its toll on row crops, and that could be trouble for the nation’s biodiesel and ethanol makers. The latest USDA crop report out this morning shows that the corn harvest this year will be down 13 percent from last year’s numbers, with soybeans expected to be 12 percent lower than 2011.

Corn production is forecast at 10.8 billion bushels, down 13 percent from 2011 and the lowest production since 2006. Based on conditions as of August 1, yields are expected to average 123.4 bushels per acre, down 23.8 bushels from 2011. If realized, this will be the lowest average yield since 1995. Area harvested for grain is forecast at 87.4 million acres, down 2 percent from the June forecast but up 4 percent from 2011.

Soybean production is forecast at 2.69 billion bushels, down 12 percent from last year. Based on August 1 conditions, yields are expected to average 36.1 bushels per acre, down 5.4 bushels from last year. If realized, the average yield will be the lowest since 2003. Area for harvest is forecast at 74.6 million acres, down 1 percent from June but up 1 percent from 2011.

Biodiesel, biofuels, corn, Soybeans, USDA

10 Ways Ethanol is Helping Livestock Producers

Joanna Schroeder

Despite the lack of rain that is occurring across the U.S. this summer, the Iowa Renewable Fuels Association (IFRA) has released a list of 10 ways ethanol producers are helping livestock farmers during the drought. IRFA says that although the drought is having a profound impact on crop production, because of ethanol production, there is larger corn crop and more flexible supply than ever available during other drought periods.

“Today’s USDA report confirms what we already knew – that the drought’s impact on supply and price will be felt by corn consumers around the world,” said IRFA Executive Director Monte Shaw. “Yet, the ag sector has seen droughts before, and it will survive again. This is a time when all of agriculture should pull together. Unfortunately, national livestock trade associations have chosen to politicize the on-going drought as part of their multi-year effort to return corn prices to $2 per bushel. At times like this, it is important to look past the rhetoric to the facts.”

During the American Coalition for Ethanol 25th Annual Conference, Cindy Zimmerman sat down with Shaw to discuss the call for a waiver of the Renewable Fuel Standard (RFS) with many of the calls coming from the livestock industry. They also discussed 10 ways ethanol producers are helping livestock producers during this tough time.

Monte Shaw interview at ACE

Ethanol helps all types of livestock producers. “We have a better price of corn. It makes them more competitive against the integrators,” explained Shaw. “But then we also have the distillers grains. And if you think about it, we planted 95 million acres of corn this year instead of 75 million because of ethanol. So yes, we’re taking a nasty hit from this drought and this is going to cause pain among all corn users, but we’re going to have a much bigger crop than we would have otherwise.”

“And then the ethanol industry returns that 20 million additional acres of protein goes straight to the livestock industry. So we have 20 additional acres of protein that would not be out in the market, the feed market, if it weren’t for the ethanol industry,” he added. Read More

Agribusiness, Audio, biofuels, corn, Ethanol, Iowa RFA

Herseth-Sandlin Honored with ACE President’s Award

Cindy Zimmerman

One of several awards given at the American Coalition for Ethanol (ACE) conference in Omaha on Thursday night was presented by the organization’s president to his daughter.

Lars Herseth had the honor of presenting the award to Stephanie Herseth-Sandlin, former Congresswoman from the state of South Dakota. She was honored for her dedication to the ethanol industry, both as a member of Congress and in private industry.

“It was certainly special to receive the award from my father and all the folks I’ve worked with over the past decade,” she said. “To receive such a distinction makes me feel great about my public service as well as my on-going advocacy that I’ve brought value to the table for all of their efforts.”

Herseth-Sandlin, a Democrat who served in Congress from 2004 to 2011, helped to shape energy policy at the time that included the current Renewable Fuel Standard (RFS). “Now it’s about making smart judgements in defending the RFS but looking for additional new opportunities,” she said. Those opportunities include the Urban Air Initiative, which she talks about some in this interview and will be discussed at the ACE conference on Friday.

Listen to my interview with Herseth-Sandline here: Stephanie Herseth-Sandlin
2012 ACE Conference Photo Album

ACE, Audio, Ethanol, Ethanol News