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The latest knock against ethanol claims the green fuel was fueling a spike in wheat prices as more growers were switching to corn acres to provide the feedstock for ethanol. But USDA’s Chief Economist Keith Collins says it just isn’t so.

This story from Farms.com says Collins claims global stocks are really behind the rise in wheat:

Collins took umbrage Monday with a weekend article in the Washington Post that attempted to peg high wheat prices to the demand for ethanol and the crunch for acres.

Collins noted this year’s wheat crop was planted before corn prices took off. The high price of corn had no factor in wheat planting, Collins said. The key factor stems from smaller crops in Canada, the Ukraine, Australia and the European Union, Collins said.

He went on to tell the gathering that there will be more competition next spring for corn acres instead of soybean and wheat, but he says the real driver on the prices continues to be the fact that wheat stocks worldwide are at their lowest point since USDA began tracking global stocks in 1960.

An area best known for its natural gas fields will become home to the first commercial biomass ethanol plant in the U.S.

This story in the High Plains Journal says Abengoa Energy will build the plant in Hugoton, Southwest Kansas:

The new plant should be completed in 2010 and is funded in part by the U.S. Department of Energy. Abengoa Bioenergy New Technologies is constructing the facility that is designed to produce approximately 13 million gallons of ethanol annually from a daily input of 930 tons of cellulosic crop residue. The company anticipates using stock such as switch grass, corn stover, grain sorghum and wheat straw from mainly a 50-mile radius of Hugoton. The facility will also produce 88 million gallons of ethanol using traditional grain processing.

The company says it needs only about 4-7 percent of the biomass available within a 50-mile radius of the production plant to satisfy the new plant’s 930 tons per day appetite. The biomass will be the leftover residue that most farmers would get rid of… but still enough residue to help the area’s soil.

Today’s announcement was welcomed by state and federal elected officials:

The announcement of the new plant was attended by Kansas Governor Kathleen Sebelius. “Twenty to 25 years from today you are going to look back to today as a historic day,” she said.

U.S. Congressman Jerry Moran, also told the group he sees energy independence as key in fighting terrorism. When the United States reaches a point of being dependent on the middle East for energy production, we will all live in a safer place, he said.

Ethanol-giant POET has opened its 21st plant during a grand opening ceremony at its latest facility near Portland, Indiana. The 65-million-gallon-a-year makes POET the largest ethanol producer in the world cranking out an amazing 1.1 billion gallons annually.

This press release from the company says this is the first POET ethanol plant in Indiana, but two more are in the works for the Hoosier State:

“When we started our first facility in 1988 at one million gallons per year, we had no intentions of becoming the largest,” Jeff Broin, CEO of POET, said. “We simply realized that farmers needed additional uses for their crops and the country needed a clean-burning, domestic fuel. Now, with ten thousand farmer-owners and investors from all walks of life, we are developing the rural economy, improving the environment and reducing our nation’s dependence on foreign oil.”

U.S. Senator Richard Lugar, who spoke at the ceremony said, “POET Biorefining – Portland and the work of the community of Portland to support it are part of the vital effort to build a more secure America – an America less reliant on foreign sources of oil.”

Not only is the ethanol from the plant good for the environment, but the ethanol plant itself is doing its part. First of all, it using using a process that POET calls the BPX™ process that doesn’t use heat in the cooking process of producing ethanol, reducing energy usage by 8-15 percent in comparison with conventional plants. It will also be outfitted with a regenerative thermal oxidizer that eliminates up to 99.9 percent of air emissions. In addition, the Portland, Indinan plant gets all of its water from a nearby quarry that pumps out the water anyway to do the excavation.