Brazil Tweets Tariff Decision

A tweet from Brazilian Minister of Agriculture, Livestock and Supply Blairo Maggi late yesterday afternoon informed the world that Brazil’s foreign trade chamber has approved a 20 percent tariff on U.S. ethanol imports after a 600 million liter tariff rate quota.

The Renewable Fuels Association (RFA), U.S. Grains Council (USGC) and Growth Energy issued a joint statement on the decision.

“We are disappointed and discouraged to see the ruling out of Brazil today imposing a tariff on U.S. ethanol. Given the tremendous volume of information we provided to Brazil that demonstrated how misguided a tariff would be, it seemed politics prevailed today and Brazilian consumers lost. Imposing tariffs on U.S. ethanol imports will hurt Brazilian consumers by driving up their costs at the pump. Additionally, this action goes against Brazil’s longstanding view that ethanol tariffs are inappropriate and will effectively close off an open and bilateral trading relationship that benefits all sides. We strongly urge this recommendation to be reversed as soon as possible and will work to that end through all available pathways.”

RFA CEO Bob Dinneen (@ethanolbob) had his own tweet in response to the decision:
“Brazil just hurt their own consumers by imposing a quota and tariff on US #ethanol – the lowest cost octane on the planet. #foolish”

AgWired Energy, Ethanol, Growth Energy, RFA, Trade, USGC

Japan Ag Ministry Rep Visits MN Ethanol Plant

Cindy Zimmerman

Kimihiko Eura, Japan’s Ministry of Agriculture; Tim Rudnicki, Minnesota Bio-Fuels Association: Randall Doyal, CEO of Al-Corn Clean Fuel

The Deputy Director for Food Security at Japan’s Ministry of Agriculture, Forestry and Fisheries toured Guardian Energy in Minnesota this week as part of a five-day visit to learn about the state’s agriculture industry hosted by the Minnesota Corn Growers Association.

During the tour, Kimihiko Eura learned about incoming grain handling, grain storage, liquefaction, fermentation, distillation, dried distillers grains (DDGs), corn oil, ethanol shipment and exports at Guardian Energy. “We are interested in learning how ethanol is produced and its impact on the demand and supply of corn. We are also looking at the possibility of importing DDGs to Japan,” Eura said. His visit to Guardian Energy was his first time at an ethanol plant since Japan has none.

Ethanol, Ethanol News, International

Commerce Dept Finds Unfairly Subsidized Biodiesel Exports

Cindy Zimmerman

The preliminary determination of the U.S. Department of Commerce is that exporters of biodiesel from Argentina and Indonesia did receive “countervailable subsidies” and may allow for collection of retroactive duties.

“The U.S. values its relationships with Argentina and Indonesia, but even friendly nations must play by the rules,” said Commerce Secretary Wilbur Ross. The department determined that both countries subsidized exports by as much as 68 percent, and that “critical circumstances exist” that would pave the way for imposing duties going back to May 2017.

“The Commerce Department has recognized what this industry has known all along—that foreign biodiesel producers have benefited from massive subsidies that have severely injured U.S. biodiesel producers,” said Doug Whitehead, chief operating officer of the National Biodiesel Board, on behalf of the NBB Fair Trade Coalition.

As a result of Commerce’s ruling, importers of Argentinian and Indonesian biodiesel will be required to pay cash deposits on biodiesel imported from those countries once the preliminary determination is published in the Federal Register sometime next week and rates for Argentina will apply retroactively 90 days from the date of the notice. Imports of biodiesel from Argentina again jumped 144.5 percent following the filing of the petitions.

Renewable Energy Group (REG), the nation’s largest biodiesel producer, called the preliminary determination a victory. Interim President and CEO Randy Howard issued the following statement after the announcement:

“This should give American biodiesel producers the opportunity to make more cleaner-burning advanced biofuel here at home,” said REG Interim President and CEO Randy Howard. As we and others have testified to the EPA and the Administration during the public comment period on the RVO’s earlier this month, our domestic industry can easily increase production to match volumes similar to what we have seen from Argentina and Indonesia.”

Biodiesel, Trade

Shifting to High Octane Ethanol Future

The American Coalition for Ethanol (ACE) annual conference last week included a panel on shifting to high-octane fuel.

First, Trey Binford, product manager of North America Dispensers at Wayne Fueling Systems, discussed the infrastructure component. He explained why Wayne differentiated itself as the first equipment manufacturer to exclusively offer fuel dispensers UL-listed for E25 to gasoline retailers in North America.

Brian West with the Fuels, Engines and Emissions Research Center at Oak Ridge National Laboratory shared the testing underway on engines to help demonstrate the benefits of high-octane fuel to help automakers meet fuel economy and greenhouse gas (GHG) reduction targets.

Finally ACE members heard from Adam Gustafson, partner at Boyden Gray & Associates, who is helping lead an effort to enable automakers and consumers to experience the benefits of high-octane fuel.

ACE Executive Vice President Brian Jennings moderated the panel discussion – listen to it here: ACE Conference Octane Panel

2017 ACE Conference Photo Album

ACE, AgWired Energy, Audio, Ethanol

Brazil Corn Ethanol Plant Starts Production

Cindy Zimmerman

FS Bioenergia, Brazil’s first large-scale corn ethanol production facility, is officially in production.

The plant, located in Lucas do Rio Verde, Mato Grosso, is the result of an international collaboration between Brazilian agribusiness Fiagril and U.S.-based Summit Agricultural Group headquartered in Alden, Iowa.

In its initial phase of operations, FS Bioenergia will annually process 22 million bushels of corn and produce more than 60 million gallons of corn ethanol, 6,200 tons of corn oil and 170,000 tons of valuable feed rations for Brazil’s growing livestock industry. By 2018, FS Bioenergia’s second phase of operations will increase corn processing and ethanol production two-fold.

The plant will help supplement existing sugarcane ethanol production to meet the country’s increasing demand for domestic ethanol by using Mato Grosso region’s substantial corn production. In addition, the plant’s co-product of dried distillers’ grains (DDGs) will serve as high-value feed for the expanding Brazilian livestock industry.

Summit Agricultural Group and Fiagril broke ground on the corn-only ethanol production facility in early 2016 and utilized process technologies from ICM, Inc.

Brazil, corn, Ethanol, Ethanol News

Novozymes Brings Advanced Enzymes to European Ethanol Market

Cindy Zimmerman

Novozymes has launched Spirizyme® 2.0 T and Spirizyme Ultra T glucoamylase enzymes with trehalase for the European ethanol market. The products, which are part of the Spirizyme T Portfolio to deliver increased yield and sugar conversion, were introduced earlier this year for the U.S. market.

Trehalose, a type of sugar that is normally left unfermented in a standard ethanol plant, is targeted by the trehalase enzyme to produce glucose, which is then fermented to ethanol. Trehalose makes up a significant part of the ‘DP2 peak’, which is a measure of disaccharides and contributes to the overall residual sugar in an ethanol plant. The more DP2 an ethanol plant can convert, the more ethanol it will produce.

Source: Novozymes press release

enzymes, Ethanol, Ethanol News, Novozymes

Moving More Ethanol Exports

U.S. ethanol exports are setting records this year and that is due at least in part to the efforts of the U.S. Grains Council ethanol advisory team, chaired this year by Jim Glavin, CEO of Lakeview Energy.

Galvin spoke at the American Coalition for Ethanol (ACE) annual conference last week in Omaha about some of the global headwinds and tailwinds for exports. “Number one, we’re looking at trying to double exports,” said Galvin, noting the industry is expanding at a rate of about three percent a year.

At the same time, Galvin says the U.S. ethanol industry has lately become a victim of its own export success, with major markets like China and Brazil restricting imports this year.

Listen to Galvin’s presentation and interview below.

Audio files:
Interview with Jim Galvin, Lakeview Energy

Jim Galvin, Lakeview Energy, remarks

2017 ACE Conference Photo Album

ACE, AgWired Energy, Audio, corn, Ethanol, USGC

New Study Shows RFS Works for Economy

Cindy Zimmerman

A new economic modeling study being published in the American Journal of Agricultural Economics finds that the “Renewable Fuel Standard (RFS) has substantially benefited the U.S. economy by lowering gasoline and crude oil prices, cutting crude oil imports, adding value to U.S.-produced agricultural commodities, and reducing U.S. greenhouse gas (GHG) emissions.”

“The results confirm that the current RFS program considerably benefits the agriculture sector, but also leads to overall welfare gains for the United States,” according to the study’s authors, Iowa State University economists GianCarlo Moschini, Harvey Lapan, and Hyunseok Kim. “We find that the RFS has indeed proved to be a remarkably effective tool for farm support.”

The analysis found the RFS in 2015 saved the U.S. economy $17.8 billion in gasoline expenses, compared to a case where no RFS existed. That’s equivalent to $142 per American household. Gasoline prices were $0.18 per gallon, or 9.5%, lower because of the RFS. In addition, the RFS is responsible for increased federal tax revenues.

Further, the results highlight the impact of the RFS on domestic energy security, showing that “the RFS leads to a modest contraction in domestic crude oil production, and a larger decline in imports of crude oil.” According to the study, crude oil imports were nearly 200 million barrels lower in 2015 than if the RFS did not exist. Meanwhile, domestic crude oil production was only 0.3% lower in the “2015 RFS” case than in the “no RFS” case.

“The results that we have presented confirm that the current RFS program considerably benefits the agriculture sector,” write the authors.

Read the report here.

Ethanol, Ethanol News

Ethanol Production Could Outpace Demand

Cindy Zimmerman

A new report forecasts ethanol production is on pace to exceed domestic and export demand as producers continue to reinvest last year’s profits into facilities and additional production capacity.

The report from CoBank on “Ethanol’s Growth Path: Output and Export Uncertainties Both Rising” outlines predicts that the ethanol market will soon face worsening profit margins, which could potentially push the industry toward consolidation. However, producers that are well-capitalized with strong balance sheets and cash reserves will be in the best position to weather the softening market.

“Forecasts indicate that total ethanol production by 2020 will have increased by approximately 850 – 900 million gallons, compared to 2017 levels,” said Tanner Ehmke, CoBank senior economist. “Without a substantial increase in domestic demand or exports to clear excess supplies, ethanol producers are facing a downturn over the medium term. Those who have access to multiple transportation markets and have invested in new technology will be leaner and more cost efficient, enabling greater flexibility to endure prolonged periods of low prices.”

Read more from CoBank.

Ethanol, Ethanol News, Exports

Siouxland Ethanol Receives Grassroots Award

Cindy Zimmerman

The American Coalition for Ethanol (ACE) presented this year’s Grassroots Award to Siouxland Ethanol LLC of Jackson, Nebraska.

The award is given annually “to a devoted individual or organization that often perform “behind the scenes” to advance the cause of ethanol.” Siouxland Ethanol LLC was presented with this year’s award by Liz Bunkers, ACE director of member and industry relations, for the plant’s efforts to go above and beyond to cultivate interest in higher ethanol blends in their community and throughout the country.

“The efforts of this group provide a shining example to others who seek to replicate their success,” Bunkers said. “They have hosted E15 and E30 fuel promotion events and they have worked hard to educate their neighbors about the clean air benefits of our high-octane, low-carbon fuel.”

Siouxland ‎Director of Industry and Investor Relations Pam Miller also did one of the breakout session at the annual conference about promoting events such as grand openings. “We know it’s important for us to promote ethanol because it’s a great product but we need to get the word out … and we enjoy doing that.” she said. The plant just celebrated its 10th anniversary this year.

Audio file: Interview with Pam Miller, Siouxland Ethanol

2017 ACE Conference Photo Album

ACE, Audio, Ethanol