energy.agwired.com

With all the buzz about ethanol, some market watchers are predicting an increase in corn futures, while sugar futures are high and expected to go even higher, or maybe not. Market Watch Commodities Corner quotes CKFutures.com analyst Chris Kraft saying, “Corn futures have the potential to explode higher due to increased demand from ethanol production.” Demand for the alternative fuel has already helped sugar prices double in the past six months to trade over 19 cents per pound on the New York Board of Trade — their highest levels since 1981. Corn has a long way to catch up. March corn trades around $2.25 a bushel on the Chicago Board of Trade, a five-month high. High sugar futures caught the attention of the Wall Street Journal this week as well, an article which was critiqued by Elliot Wave International’s Futures Focus. Sugar has tripled in value during the past two years. Prices have doubled in the past five months. They jumped 20% in just three sessions in mid-January. In short, sugar has been rallying. Just in time to explain the move, Thursday’s (Feb. 9) Wall Street Journal includes an in-depth look at this soft market that seeks to explain “Why Sugar Costs More And More.” At the top of their list: Ethanol. … Yet ironically, on the same day that the Journal finally devoted a thorough news story to sugar’s surge, prices for the soft saw their biggest single-session decline in months.
Bottom line – who really knows?

Expect the a lot more plants like this one to be built to lessen the ethanol industry’s dependence on natural gas. Archer Daniels Midland has announced its fourth coal-fired co-generation (Co-Gen) plant in Columbus, Nebraska to help power its corn milling and ethanol operations. According to the company release, the plant will be permitted to burn a blend of fuels, including high and low sulfur coals, tire derived fuel and biomass to produce process steam and electric energy. The addition of this Co-Gen plant will help lower ADM’s overall energy costs and lessen its vulnerability to energy market price fluctuations. Co-generation reduces the amount of fuel burned per unit of energy output, and reduces the corresponding emissions of pollutants and greenhouse gases. ADM currently operates similar Co-Gen facilities in Decatur, Illinois and Cedar Rapids, Iowa and has another under construction in Clinton, Iowa.

The American Coalition for Ethanol is trying to clear up some confusion in the minds of the public about the term “ethanol.” According to an organization release, ethanol means different things to different people. Because of the way the terminology is used, two misunderstandings frequently arise: people mistakenly believe it takes a special car to run on ethanol and that ethanol is only available at a few gas stations in the Midwest.
“Every single automobile on the road today is ethanol-capable,” said Brian Jennings, ACE Executive Vice President. “All vehicles can operate on a 10 percent blend of ethanol with gasoline, and Flexible Fuel Vehicles can use E85, an alternative fuel containing 85 percent ethanol.”
Ron Lamberty, ACE Vice President / Market Development, added that ethanol is much more widespread than many people realize: “Ethanol-blended fuel is available at thousands and thousands of America’s gas stations, literally from coast to coast. E85, the alternative fuel that is 85 percent ethanol, is available at a smaller number of stations and that figure is growing very quickly.”
ACE also has a page on it’s website providing information about cellulosic ethanol for the public.

Ag Secretary Mike Johanns has joined the roster of speakers at the National Ethanol Conference coming up February 20-22 in Las Vegas. The former governor of Nebraska and former chairman of the Governor’s Ethanol Coalition will speak on Wednesday morning, right after the current chairman of the Coalition Kansas Governor Kathleen Sebelius, and just before the current Governor of Nebraska (and soon to be chair of the GEC) Dave Heineman. That’s what I call symmetry.
Expect Johanns to talk about the administration’s commitment to putting more dollars into ethanol research.

Missouri’s four ethanol plants have created a significant impact on the state’s economy, according to a new study just completed by the University of Missouri-Columbia. The study, which was funded by the Missouri Corn Growers Association,used the sophisticated input-output statistical model called IMPLAN to determine the economic impact of the ethanol industry in Missouri. Basically, they found that:
4 ethanol plants = $92,359,577 in labor income with a total of 2,784 jobs
+ $177,740,334 in value added dollars
+ $390,198,411 in net total output dollars – that is, the estimated amount that ethanol contributes to Missouri’s economy
So, that’s pretty impressive. And with more plants due to come on-line soon, the impact will be even greater, according to a statement from MCGA president Terry Hilgedick. “According to this study, when Missouri ethanol production reaches 350 million gallons, just the day-to-day operations will result in the creation of 5,613 jobs, $63 million in tax revenues and a total net increase of $726 million to Missouri’s economy each and every year. This is value-added agriculture at its best.”
Here is a link to the MCGA release, and a link to the MU Commercial Ag Program page where you can find the study in PDF format.