New Ag Committee Chairs Disagree About Ethanol Tariffs

Cindy Zimmerman

According to a report from Truth About Trade & Technology, soon-to-be Agriculture Committee chairmen Sen. Tom Harkin and Rep. Collin Peterson are in disagreement over the lifting of tariffs on imported ethanol.

After earlier reports indicated Harkin, an Iowa Democrat, would support a lifting of tariffs on ethanol imported to the U.S. from abroad, the Minnesota Democrat Peterson took a hard line against such a move Friday.

“Are you serious?” Peterson said Friday after learning of Harkin’s stance on the tariff. “I’m not in favor of that. I think we’ve got plenty of ethanol production in this country coming online to meet the demand of this industry, and I for one am not interested in making any changes in the foreseeable future in that.”

In addition to diluting a now vibrant corn-based ethanol marketplace in the U.S., Peterson said allowing tariff-free ethanol imports would hamper efforts underway to develop cellulosic ethanol production, support for which Peterson says he hopes to include in the 2007 farm bill.

Read more.

Ethanol, Government, News

Grains Council Sees Increased Exports of Ethanol By-Product

Cindy Zimmerman

Tight world grain supplies and expanding corn based domestic ethanol production have created improved marketing options for U.S. feed grain producers. However, the U.S. feed grains industry should not abandon international market development programs and efforts to preserve its hard won world market share of feed grain and co-product exports based on the current trends, according to Ken Hobbie, president and CEO of the U.S. Grains Council.

Speaking to attendees of the Council’s First Ever Joint International Marketing Conference and 47th Annual Membership Meeting, Hobbie noted four areas on which the Council should focus efforts over the next three years – customer servicing and education; promotion of distiller’s dried grains with solubles (DDGS); building demand in countries and regions with whom the United States has free trade agreements while exploring opportunities in large markets with great potential like China and India; and issues related to market access and biotechnology acceptance.

Read more from the USGC and the Associated Press.

Ethanol, International, News

More Corn Staying Home

Cindy Zimmerman

If only a quarter of proposed new Midwest ethanol plants come on-line, up to half of corn in Midwest states currently sent for export could be diverted to domestic ethanol production, according to a new report by the Institute for Agriculture and Trade Policy (IATP).

“Staying Home: How Ethanol Will Change U.S. Corn Exports,” by IATP’s Mark Muller and Heather Schoonover, looks at the stunning growth planned for ethanol plants in the Midwest and their potential impact on corn exports. The paper includes data on how corn exports for individual Midwest states could be impacted by new ethanol plants, including, Iowa, Nebraska, Minnesota, Illinois, Indiana, Wisconsin, Missouri, North Dakota, and South Dakota.

The reports recommends that in the next Farm Bill “policymakers should focus on building and diversifying opportunities for renewable fuels and energies; promoting farm practices and cropping systems that build soil health and improve water quality; and ensuring that farmers and rural communities benefit from these new opportunities.”

Read press release summary or check out the IATP site for the full report and video interview.

Ethanol, News

See You in San Antonio

Cindy Zimmerman

It’s time to register for the 2007 National Biodiesel Conference, scheduled for February 4-7 in sunny San Antonio.

Attendance at the annual conference has doubled every year since it started in 2004 and this year it could top 2,000 – so early registration is highly recommended. Better get hotel reservations early too as rooms in the hotel blocks are moving fast, with some possibly sold out.

According to the National Biodiesel Board, the conference will feature “an impressive slate of world-renowned figures like James Carville and Mary Matalin, and Merle Haggard, who will tie biodiesel into the national and cultural landscape of our times. The event’s offerings don’t stop there: more sessions and a much larger exhibitor list at the expo will make this an educational and networking event not to be missed.”

If you can’t make it, not to worry. Domestic Fuel will be providing regular updates from the event and we will once again be hosting the Biodiesel Conference Blog live, on-site with pictures, audio, video and more.

Biodiesel, Biodiesel Conference, conferences

Fungus and Termites May Hold Keys to Cellulosic Future

Cindy Zimmerman

A prolific fungus found in eastern Russia and termites from Costa Rica are just two of the avenues being explored to get ethanol on the cellulosic superhighway.

A Business Week online article reports on some of the bio-breakthroughs that are promising more efficient ways to make ethanol.

Scientists are scouring China for strains of tall grasses and tinkering with plants’ genes to make better energy crops. They are collecting termites in Costa Rica, hoping to harness the bugs’ ability to digest cellulose. Several groups have studied a fungus discovered during World War II that ate up the Army’s cotton tents. Richard Hamilton, CEO of Thousand Oaks (Calif.)-based Ceres Inc., compares the progress to TV makers’ struggle to perfect flat-panel displays. The first few factories “will be godawful expensive, but we’re early on the learning curve. We’ve only scratched the surface of what a lot of us think is possible,” he says.


Read the whole article.

Ethanol, News

Ethanol Boom to Continue in 2007

Cindy Zimmerman

Business Week reports that the ethanol industry appears poised for another big year in 2007, as companies scramble to take advantage of continuing government subsidies and a growing political desire to reduce the country’s dependence on foreign oil.

But Wall Street investors who went pedal-to-the-metal during ethanol’s midyear IPO frenzy seem to be easing off the accelerator upon warnings of volatile commodity prices and a potential oversupply down the road.

Read full Business Week article.

Ethanol, News

USDA Raises Crop Price Forecast

Cindy Zimmerman

The latest global supply/demand report from the U.S. Department of Agriculture increases the forecast for corn and soybean prices this year due in part to stronger demand for ethanol and biodiesel.

Average corn prices are now expected to range between $2.90 to $3.30 a bushel, up ten cents from last month’s forecast. USDA Chief Economist Keith Collins said, “We think about 50 percent of the corn crop has been marketed so far this year at an average price of about $2.70 a bushel. As we look for the other 50% to be marketed, we think that could probably average about $3.50 a bushel.”

According to market analyst Brian Hoops of Midwest Market Solutions, this is only the fourth time in history that corn prices have topped the $3.00 mark. “The record year was 1995-96, so we are in some pretty uncharted waters for corn as far as cash price,” Hoops commented during a Minneapolis Grain Exchange conference call with reporters after the report was released Monday morning.

The average price for soybeans was also increased by a dime in the December report, to between $5.70 and $6.50 a bushel.

Listen to report from USDA Radio: Listen To MP3 USDA Report (1 min MP3)

Audio, Biodiesel, Ethanol, Government, News

Oil From Algae

Cindy Zimmerman

Solix Biofuels Inc., a startup company based in Boulder, is working with Colorado State University engineers to commercialize technology that can cheaply mass produce oil derived from algae and turn it into biodiesel.

Algae are the fastest growing organisms on the planet, and can produce 100 times more oil per acre than conventional soil-tilled crops that are now being grown for biofuel use – now they just have to create the technology to harness that potential.Algae

Solix officials plan to commercialize the technology over the next two years. After ramping up to widespread production, the company expects to eventually compete commercially with the wholesale price of crude petroleum.

Bryan Willson, director of Colorado State’s Engines and Energy Conversion Laboratory, is pictured inspecting algae colonies. “This process harnesses photosynthesis to turn carbon dioxide and energy captured from the sun into an economical petroleum substitute,” he says.

Solix officials estimate that widespread construction of its photo-bioreactor system could meet the demand for the U.S. consumption of diesel fuel – about 4 million barrels a day – by growing algae on less than 0.5 percent of the U.S. land area, which is otherwise unused land adjacent to power plants and ethanol plants. The plants produce excess carbon dioxide, which is necessary to turn algae into oil. In addition to producing biodiesel, the process would prevent a large portion of the greenhouse gases produced by coal-burning power plants from being expelled directly into the atmosphere.

Lots more from Colorado State – including pictures, audio and video.

Biodiesel, Research

Tariff on Ethanol Imports Extended

Cindy Zimmerman

Before adjourning Saturday, Congress approved legislation extending the 54-cent-per-gallon tariff on imported ethanol as part of the Omnibus Tax bill.

The tariff was set to expire in October 2007 but will continue to be imposed until January 2009.
ACE

The American Coalition for Ethanol praised the action to support domestic ethanol production.

Brian Jennings, ACE Executive Vice President said, “We are extraordinarily grateful for the bipartisan leadership which accomplished the extension of the tariff offset to January 1, 2009. This important action helps pave the way for continued growth and investment in rural communities and clean burning, homegrown, renewable fuel.”

Read AP report.

Ethanol, News

Will We Have Enough Corn?

Cindy Zimmerman

The Iowa Corn Growers/Corn Promotion Board has released a document addressing concerns about whether they will be able to produce enough corn to meet demand for ethanol.

One of the issues they address is the price of corn, which this year is expected to average about $3 a bushel, the highest it has been since 1995. Corn Graph

The corn growers point out that during the last decade Iowa’s corn farmers have too often had to rely on federal farm programs to break even because corn prices failed to keep pace with either production costs or ordinary inflation (see graph).

Like other Americans, corn farmers should be able to compete in the marketplace, sell their crops for a profit, and earn a living for their families without being faulted for corn prices being “too high.”

Read the document pdf file.

Ethanol, News