Industry Stakeholders Discuss Distillers Feed Products

Cindy Zimmerman

The National Corn Growers Association (NCGA) recently held the first Distillers Feed Products Nutrition Roundtable, bringing together livestock and poultry producers, animal nutrition experts, and ethanol technology providers to discuss the changing number and nutrient profile of distillers feed products.

As the profile of distillers feed products change, challenges and opportunities arise. Beef, pork, poultry, and dairy experts, Drs. Dan Loy, Jerry Shurson, Shelia Purdum, and Alvaro Garcia, respectively, gathered to discuss current understanding and key research needs. The afternoon consisted of technical presentations by ICM and Fluid Quip Process Technologies along with a discussion on the next steps and action items to address the changing nutrient profile and value added from these feed products. Other participants included representatives from Green Plains, Flint Hills Resources, National Cattlemen’s Beef Association, and Mitch Schweers, a farmer from Nebraska and member of NCGA’s Feed, Food and Industrial Action Team.

NCGA Director of Market Development Sarah McKay said the roundtable is one step they are taking across the value chain to better understand new corn fractionation technologies that separate out the various components of corn to allow improved utilization of the subsequent product streams. “While this technology has a lot of potential for early adopters and could increase corn grind, it will require a change in how the value chain views and uses the products of ethanol plants. Gathering stakeholder input and starting a dialog early should help the rollout of this technology proceed smoothly.”

corn, Distillers Grains, Ethanol, Ethanol News, Feed

Biodiesel Interests Testify at EPA Hearing

Cindy Zimmerman

At a hearing in Michigan on Friday, representatives from the National Biodiesel Board (NBB) and its member companies weighed in on the Environmental Protection Agency’s (EPA) proposal related to sales of 15 percent ethanol fuel (E15) and changes to the Renewable Identification Number (RIN) compliance system. Biodiesel interests also commented on the need to stop granting Small Refinery Exemptions (SREs).

“We appreciate EPA taking claims of RIN market manipulation seriously. But because the agency has yet to see data-based evidence of such behavior, we recommend that EPA not finalize the RIN reform portion of the proposed rule,” said NBB Chairman Kent Engelbrecht, ADM.

“EPA must change its practice of encouraging retroactive small refinery exemption petitions,” Kurt Kovarik, NBB’s Vice President of Federal Affairs, testified. “We ask that the agency use this opportunity to instead address the timing of small refinery exemption petitions. If EPA finds that it can easily propose a quarterly compliance deadline in the RIN reform proposed rule, the agency should feel just as comfortable applying a similar reasonable administrative requirement that small refineries submit petitions before the end of the compliance year.”

The president of NBB member W2Fuel, based in Michigan, also testified at the hearing. “To succeed, the biodiesel industry needs signals that allow us to forecast market demand. While the RVO should be the forecast, the current practice of granting retroactive small refinery exemptions undermines that signal,” said W2Fuel president and CEO Roy Strom.

Audio file – National Biodiesel Board Chairman Kent Engelbrecht, ADM; Kurt Kovarik, VP Federal Affairs; Roy Strom, W2Fuel –

EPA Michigan hearing - National Biodiesel Board
Audio, Biodiesel, EPA, NBB, RFS

Ethanol Producers United in Comments to EPA

Cindy Zimmerman

Four ethanol producers representing plants in four different states made “substantially similar” points at hearing Friday on proposed regulatory changes related to retail sales of 15% ethanol blended fuel (E15) and the renewable identification number (RIN) compliance system Renewable Fuel Standard (RFS) program.

Substantially similar, otherwise known as “sub-sim”, is a term used in the EPA proposal relating to the definition of E15 in relation to the Tier 3 certification fuel, which is E10. Ethanol producers support that definition but oppose EPA’s proposal to impose certain restrictions on the use of E15 under the “sub sim” approach. Producers also expressed concerns about the regulation of E15 made at blender pumps, which as proposed would not qualify for the 1-psi RVP waiver.

All four producers also urged EPA to separate the E15 and RIN reform provisions of the proposal and consider them individually. In addition, they stressed the damage caused by the granting of Small Refinery Exemptions (SRE) by EPA and urged the agency to reevaluate how those requests are being handled.

Listen to their comments below:

Ethanol producers –
EPA Michigan hearing - Randy Doyal, Al-Corn Clean Fuel, MN

EPA Michigan hearing - Mick Henderson, Commonwealth Agri-Energy, KY

EPA Michigan hearing - Nick Bowdish, Elite Octane, IA

EPA Michigan hearing - Pam Miller, Siouxland Ethanol, NE
Audio, Ethanol, Ethanol News

EPA Hearing Witnesses Stress Problem of SREs

Cindy Zimmerman

Small refinery exemptions were not the topic of an EPA hearing Friday in Michigan, but many witnesses used precious seconds of their allotted three minutes to comment on how they are impacting an already stressed ethanol industry.

“While RFS small refinery exemptions (SREs) are not the explicit subject of this rulemaking or today’s hearing, we feel compelled to remind EPA that continued abuse of the SRE program would significantly undermine the ethanol market expansion intended to result from finally allowing year-round sales of E15,” said Renewable Fuels Association (RFA) president and CEO Geoff Cooper. “In other words, continued SREs threaten to derail the central objective of the rulemaking under consideration today.”

EPA Michigan hearing - RFA CEO Geoff Cooper

Iowa Governor Kim Reynolds got to talk for 12 minutes and spent a good amount of that time addressing the harm caused by SREs.

EPA Michigan hearing - Iowa Gov. Reynolds
Audio, E15, Ethanol, Ethanol News, RFA, RFS

EPA Grants Another Small Refinery Waiver

Cindy Zimmerman

With a new waiver announced this week, the Environmental Protection Agency (EPA) has now granted a total of 35 small-refinery exemption (SRE) from the 2017 Renewable Fuel Standard (RFS) compliance year. Another 39 requests are still pending for 2018 exemptions.

“If these exemption trends continue, they will fully and completely undermine the RFS at the expense of rural America and cause consumers to pay more at the pump for dirtier fuels,” said Renewable Fuels Association (RFA) president and CEO Geoff Cooper. “With dozens of ethanol plants closing or idling and U.S. ethanol consumption showing the first annual decline in 20 years, it is unfathomable that the new EPA Administrator would double down on former Administrator Pruitt’s unjustifiable abuse of the small refinery exemption provision.”

As EPA holds a hearing today in Michigan on proposed regulatory changes related to E15 and Renewable Identification Numbers (RINS), the agency can expect to hear from ethanol stakeholders about the demand destruction being caused by the SREs. South Dakota Farmers Union President Doug Sombke says they are against the proposal to allow year round sales of E15 because they fear it will limit ethanol blending to only 15 percent.

Sombke says the EPA waivers to the refining industry resulting in a demand loss of billions of gallons of ethanol and hundreds of millions of bushels of corn has made this a critical issue because “E15 alone will never make up this loss in volume according to numerous private and government studies,” says Sombke. “This is not that complicated. Stop the waivers.”

E15, Ethanol, Ethanol News, RFA, RFS

EPA Hearing on E15 in Michigan Tomorrow

Cindy Zimmerman

Ypsilanti, Michigan will be the place Friday morning for advocates and opponents of EPA’s proposed regulatory changes related to retail sales of 15% ethanol blended fuel (E15) and the renewable identification number (RIN) compliance system Renewable Fuel Standard (RFS) program.

The Environmental Protection Agency is holding a hearing on the proposal released just 16 days ago that would allow E15 to take advantage of the 1-psi Reid Vapor Pressure (RVP) waiver that currently applies to E10 during the summer months, and to change the RIN program to bring greater transparency to the market and deter price manipulation.

The hearing will start at 9:00 am Eastern on Friday, March 29 and will end when all parties present who wish to speak have had a chance to do so. Location is the Ann Arbor Marriott Ypsilanti at Eagle Crest.

EPA has set up a listen-in line for those unable to be at the hearing. The number is 866-667-1852, Conference Code 7695837.

biofuels, EPA, Ethanol, Ethanol News

Flooding Takes Bite Out of Ethanol Production

Cindy Zimmerman

Repair crews are working around the clock to get roads and railways impacted by flooding in the Midwest back in service, while the latest weekly ethanol supply and demand numbers show production down due to the disaster.

According to the Renewable Fuels Association (RFA), ethanol production for the week ended March 22 fell 29,000 barrels per day (b/d), or 2.9%, to an average of 975,000 b/d, equivalent to 40.95 million gallons daily. This was the lowest production rate since the week ended Feb. 1, which in turn was the lowest level since Oct. 2017. The four-week average ethanol production rate declined 1.3% to 1.002 million b/d—equivalent to an annualized rate of 15.36 billion gallons.

Stocks of ethanol ticked up just a fraction to 24.4 million barrels but still represents a new record high.

Rail service remains disrupted in several states, including Nebraska and Iowa, and BNSF Railway reports employees and contractors working to repair track and restore service in areas that have experienced heavy flooding. BNSF has created a web page to address service disruptions and recovery operations in the Midwest after record flooding. It provides resources for customers affected by flooding, as well as a photo gallery for news media.

Ethanol, Ethanol News, RFA, transportation

KAAPA Ethanol Celebrates 15 Years

Cindy Zimmerman

Nebraska’s KAAPA Ethanol LLC is celebrating its 15th anniversary this week.

The farmer-owned company operates two Nebraska biorefineries. Its Minden plant produces 80 million gallons of ethanol from 27 million bushels of corn per year and has 37 employees. The company’s Ravenna plant produces more than 125 million gallons of ethanol from 42 million bushels of corn per year and has 50 employees. KAAPA is also a major supplier of distillers grains, a valuable animal feed co-product that has helped Nebraska’s beef industry thrive.

KAAPA Ethanol also operates a grain elevator in Elm Creek, Neb., and is in the process of building a new central office in Kearney, Neb., slated to be completed later this year. The company is also the largest stockholder in Guardian Energy, which manages three ethanol plants in Minnesota and Ohio.

KAAPA CEO Chuck Woodside is a past chairman of the Renewable Fuels Association (RFA). “For 15 years, KAAPA Ethanol has been a leading voice and effective advocate for the ethanol industry and value-added agriculture,” said RFA President and CEO Geoff Cooper. “Congratulations to KAAPA Ethanol’s visionary leaders, passionate farmer investors, and hardworking employees for reaching this tremendous milestone, and best wishes for many more successful years to come.”

Ethanol, Ethanol News, RFA

Biodiesel Industry Asks Congress to Extend Tax Incentive

Cindy Zimmerman

The National Biodiesel Board (NBB), joined more than 70 member companies and stakeholder organizations this week in a letter urging leaders of the U.S. House of Representatives to immediately address a multiyear extension of the biodiesel and renewable diesel tax incentive. Last year, Congress retroactively extended the tax incentive for 2017, leaving it expired for 2018 and beyond. The letter thanks Sens. Chuck Grassley (R-IA) and Ron Wyden (D-OR) for their bipartisan bill to immediately extend all expired tax incentives.

In the letter, the biodiesel industry stakeholders write, “The future of the credit has been unclear for more than 14 months. That uncertainty is curtailing investments in new plants and capital projects to upgrade existing plants. It is beginning to force some producers, blenders and distributors to cut back purchases of raw materials and deliveries of renewable fuel to consumers, which will have impacts across the economy.”

Congress last addressed the biodiesel tax incentive in February 2018, retroactively extending it for 2017 but leaving it expired for 2018 and beyond.

“The U.S. biodiesel and renewable diesel industry’s continued success is now at stake,” the letter continues. “Tens of thousands of American workers and manufacturers—as well as the millions of Americans who benefit from cleaner air and water—are depending on you to provide our industry the certainty we need to secure investments and continue growing over the next several years.”

The U.S. biodiesel and renewable diesel market grew from about 100 million gallons in 2005, when the incentive was first implemented, to more than 2.6 billion gallons annually since 2016.

advanced biofuels, Biodiesel, NBB

USDA Monitoring Nebraska Ethanol Issues

Cindy Zimmerman

Under Secretary of Agriculture for Marketing and Regulatory Programs Greg Ibach is in Nebraska this week surveying weather-related damage and talking with affected farmers and ranchers. The impact of the flooding on ethanol production was brought up during a Facebook Live roundtable with Nebraska Governor Pete Ricketts on Monday.

“We are aware at USDA that many of the railroad lines are shut down and the main issue is the backup of being able to get the ethanol out,” said Ibach. “We’re monitoring that.”

While there are indemnity programs for livestock losses and other USDA programs in place to help producers, Ibach said he is not aware of any programs that would help ethanol plants. “That is a compounding problem too because many of Nebraska’s livestock producers rely on distillers grains to use as a livestock feed and as those plants idle, that reduces the amount of feedstuffs available for producers,” he added.

Listen to a segment of the roundtable where participants including Ibach, Troy Brandenkamp with Renewable Fuels Nebraska, and Governor Ricketts, comment on the impact of the flooding on the ethanol industry.

Ethanol comments during Nebraska governor roundtable

Listen to opening remarks from Gov. Ricketts, Ibach, and state Director of Agriculture Steve Wellman:
Nebraska Gov. Ricketts, USDA Under Secretary Ibach, State Ag Director Steve Wellman

Audio, Ethanol, Ethanol News, transportation, USDA