Ethanol Continues to Fuel ADM Profits

Cindy Zimmerman

ADMShares for Archer Daniels Midland Co. took their biggest leap in over eight years as the world’s biggest corn and oilseed processor announced a second-quarter profit increase of 20 percent.

ADM’s net income rose to $441.3 million, or 67 cents a share, in the last three months of 2006, compared to $367.7 million, or 56 cents, a year earlier. Sales were up 18 percent to $11 billion, mainly due to increased prices for ethanol and corn sweeteners.

ADM CEO Patricia Woertz says the country’s biggest ethanol producer plans to get even bigger, with plans to increase production by 50 percent by the end of next year. The company currently produces 1.1 million gallons a year – about 20 percent of total US production.

Woertz said in a conference call Thursday that she expects commercial use of cellulosic ethanol to happen before the end of the decade, with some commercialization maybe as early as just two years down the road.

A webcast of the conference call is available on-line.

Ethanol, News

ARES, Blue Sun Biodiesel Announce Joint Venture

John Davis

ARES Corporation, a California-based engineering and research firm, has joined with Colorado-based Blue Sun Biodiesel to build a 15-million gallon/year B100 biodiesel plant under the name ARES Blue Sun near Clovis, New Mexico. They’ll break ground early this year. According to a joint company press release:

ARES “This new joint venture represents the initial implementation of ARES’ strategic goals in creating new businesses in the clean energy and biofuels sector,” said Dick Stuart, CEO and President of ARES
Corporation.

Blue Sun Biodiesel “Since its inception, Blue Sun has been focused on distributing a premium biodiesel fuel with warranted industry-leading specifications. The ability to bring to bear ARES’ superior engineering expertise assures Blue Sun of a continuous supply of B100 that meets our stringent quality requirements,” added Jeff Probst,
CEO of Blue Sun Biodiesel.

While the release doesn’t directly indicate more plants, it sure implies this won’t be the only biodiesel venture for the new company.

Biodiesel

Brazil Opens Country’s Largest Biodiesel Mill

John Davis

Brazil has opened a 108-million-liter (approximately 25 million gallons) a year biodiesel plant… the largest in the South American country. Brazilian President Luiz Inácio Lula da Silva attended the event. BrazilPrez1.JPG

This story in Brazzil Magazine says this one operated by Brasil Ecodiesel is not the only biodiesel mill in the country.

Brasil Ecodiesel According to the (Brazilian Ministry of Mines and Energy), the company should inaugurate another three mills this year, one in Rosário do Sul, in the southern Brazilian state of Rio Grande do Sul, another in Porto Nacional, in the northern Tocantins, and the other in São Luís, Maranhão (Northeast Brazil). With this the company should add another 324 million liters to the annual production.

Brasil Ecodiesel plans to use soy, castor seeds, and sunflower seeds as the feedstocks. The article says the government expects total biodiesel production to hit about three-quarters of a billion gallons a year in the next four years.

Biodiesel, International

Biodiesel To Drive Race Car

John Davis

Scott Racing Ltd A couple of days ago, I told you about a biodiesel motorcycle that will try to set a speed record that will be featured at the upcoming National Biodiesel Conference & Expo (Feb. 4th-7th in San Antonio, TX). Now, a British racing team says it will put a prototype 100% biodiesel engine into its car competing in the British Touring Car Championship. UK-based Crash.net reports the Scott Racing Ltd car will run on a partial biodiesel mix this coming season, switching to 100% in 2008:

“Most of the existing cars run on petrol with a few on bioethanol – no-one has yet run a fully-biodiesel powered car, as technically it is very challenging,” company managing director and former Formula Ford 1600 driver Tim Scott said. “I’m passionate about motor sport and I think we can make a diesel car competitive in the short term and gradually ramp up the percentage of biodiesel in the fuel to make a competitive biodiesel touring car next year.”

Of course, they plan to run the car on locally produced biodiesel.

Biodiesel, International

Farm Bill Proposals Stress Cellulosic Ethanol

Cindy Zimmerman

Farm Bill A word that few people even knew just five years ago when the last farm bill was written is all over the Bush administration’s 2007 farm bill proposals released Wednesday. That word is “cellulosic.”

As announced last week, the proposals include $1.6 billion in new funding for renewable energy research, development and production, targeted for cellulosic ethanol, which will support $2.1 billion in guaranteed loans for cellulosic projects and includes $500 million for a bio-energy and bio-based product research initiative.

In addition, the conservation proposal includes incentives for production of biomass on land in the Conservation Reserve Program. Natural Resources Conservation Service Chief Arlen Lancaster said, “We would prioritize those lands that would be used for growing cellulosic crops like perennial grasses that continue to provide a soil benefit and a wildlife benefit.”

Cellulosic is also a part of the forestry proposal. “We’re proposing to initiate a new $150 million wood-to-energy program as part of the president’s mission to expand the use of renewable and alternative fuels,” said Johanns. “To accelerate development of new technologies to use low-value woody biomass to produce energy. We have an abundance of this around the country.”

In an interview with Secretary Johanns after the announcement, he said the emphasis on moving toward cellulosic ethanol will help address the concerns that have been raised about increased demand for corn. “I think the livestock industry was very concerned that what we would be proposing is promoting more corn-based ethanol. Our proposals are targeted at cellulosic ethanol. We believe this is the next step.”

Listen to the ethanol portion of my interview with Johanns: Listen To MP3 Johanns Interview (2:45 min MP3)

Details of the administration farm bill proposals can be found at www.usda.gov/farmbill.

Audio, Cellulosic, Ethanol, Government, Legislation, News

Ethanol Representatives Witness First Indy Open Test

Cindy Zimmerman

Indy Car SeriesThe IndyCar® Series held its first Open Test of the season Wednesday at Daytona International Speedway where for the first time all IndyCar Series cars ran on 100 percent fuel-grade ethanol.

Ethanol Promotion and Information Council Executive Director Tom Slunecka said the IndyCar® drivers he talked to in Daytona are proud to be a part of the change to a fuel that is better for the environment and the economy, as well as being happy with its performance in their cars. Plus, the fumes of the farm-based fuel are less harmful and smell better.

“Methanol is a very gaseous-type smell – makes your eyes water and your throat tighten up. But, today as these engines cranked up for the very first time, the sweet smell of ethanol wafted over the paddock,” Slunecka said. “And all of these drivers and mechanics are so appreciative of the fact that these fumes that they are breathing today are non-toxic and their jobs just got a whole lot healthier.”

RenovaAlso in Daytona to watch the test was Dan Schwartzkopf, senior vice president of Renova Energy in Torrington, Wyo., the facility which was contracted by EPIC to supply approximately 120,000 gallons of ethanol to the IndyCar Series this season.

“In the conversations that I have had with the crews, everybody seems to like the ethanol. No bad remarks whatsoever. So, I think it’s going to be promising from this point on to see it not only here in Indy but in a number of other motor sports venues,” Schwartzkopf said.

The 17 race IndyCar® Series opens March 24, 2007 with the Homestead-Miami 300.

Listen to an interview with Tom Slunecka from the track in Daytona: Listen To MP3 Slunecka Interview (4 min MP3)

Audio, EPIC, Ethanol, Indy Racing, News

Biodiesel Space for a Buck

John Davis

broncopix2.JPG Last fall, the city of Kalamazoo, Michigan announced it would use biodiesel provided by Western Michigan University… Bronco Biodiesel… to fuel its city buses. Now, the city is renting out a building for the plant… at just $1 a year! According to a WMU press release, the biodiesel plant is expected to produce 100,000 gallons a year. The biodiesel will be made from recycled restaurant grease.

From the Bronco Biodiesel web site:
We are developing a small-scale (100,000 gallons/year) biodiesel production facility in the City of Kalamazoo to prevent the “trapped” BTUs from going down the drain. Our hope is that the facility will serve as a model for how universities and municipalities can work together and convert discarded oil into a clean burning, carbon neutral, transportation fuel.

Biodiesel, Government

Report: Biodiesel Set for “Explosive” Growth

John Davis

This story in Biofuel Review says that a report by the energy intelligence agency Emerging Markets Online says biodiesel growth is set to explode over the next 10 years… fueled by a new U.S. commitment to biofuels (remember President Bush’s 20 in 10 proposal – 20% alternative fuels in the next 10 years) and ramped up production in other parts of the world:

biodiesel2020.jpg “It is possible that Biodiesel could represent as much as 20% of all on-road diesel used in Brazil, Europe, China and India by the year 2020. If governments continue to aggressively pursue targets; enact investor-friendly tax incentives for production and blending; and help to promote research & development in new biodiesel feed stocks such as algae biodiesel, the prospects for biodiesel will be realized faster than anticipated. Biodiesel 2020 finds that each of these variables will be essential to the eventual success of these targets,” author William Thurmond notes.

The report goes on to say that the U.S. is the fastest growing biodiesel market in the world with domestic plants having trouble keeping up with demand.

Biodiesel, International

Truth and Tortillas

Cindy Zimmerman

Tortillas Truth About Trade & Technology has posted a Wall Street Journal commentary on the tortilla crisis in Mexico. The op-ed piece contends that the “cause of the corn price spike is too much government intervention.”

The sharp increase in Mexican corn prices, which fueled the tortilla price spike, followed big price increases for corn on international markets over the past year. The main cause, according to most commodity analysts, was the U.S. decision to subsidize ethanol made from corn. Growers who previously marketed their harvests to food and livestock companies suddenly have new demand from ethanol producers, who are also armed with a subsidy to make their bids more attractive. The increase in demand from government-subsidized ethanol producers pushed up prices.

Yet the U.S. isn’t the only government that is distorting markets. Mexico’s quota system for corn imports has exacerbated the problem.

Read the whole commentary.

Ethanol, International, Opinion

“BioFuels or Bust” Seminar at Wash. U. in St. Louis

John Davis

WashSci.JPGWashington University in St. Louis is playing host to a seminar on the role biofuels will play in a sustainable economics world. Jim McLaren, President and founder of StrathKirn, Inc, a science and biotech business consulting firm in nearby Chesterfield, MO, will conduct the seminar on the “state of biofuels development in the Midwest,” at Simon Hall on the Wash U campus, on Thursday, February 8th from 5-7 pm. Cost is free.

Register by clicking here (look under the Science Frontiers heading).

Biodiesel, Ethanol, News