# Can Ethanol Reduce American Oil Dependence?



## hkskyline

*Ethanol growth tied to efficient rail terminals *

CHICAGO, Jan 15 (Reuters) - As U.S. ethanol production and demand steadily climb, construction of new rail terminals that can quickly and efficiently unload unit trains is critical to sustained growth in the biofuels sector, a transportation industry specialist said on Tuesday. 

The majority of ethanol produced in the United States is shipped via railcar, much of it from major production areas in the Corn Belt to blending facilities near large cities along the coasts. 

Unit trains, seen as the most efficient and cost effective method of shipping the biofuel, can haul about 1.5 million gallons to 3.25 million gallons at a time. 

"Most of the ethanol plants that are being built currently have the ability to ship unit trains, but we have very few destination terminals that can receive trains," said Thomas Williamson, founder and principal of Kansas City-based Transportation Consultants Co. 

"When you have 100-some ethanol plants, probably 75 of which can ship unit trains, and you've only got seven destinations, it's a problem," he said, speaking at the Reuters Global Agriculture and Biofuel Summit. 

Those terminals can unload unit trains from 50 to 110 cars long in under 24 hours, Williamson said. Some smaller terminals can unload trains that long, but only in multiple phases, he said. 

U.S. ethanol capacity increased more than 40 percent in 2007 to nearly 7.6 billion gallons a year. 

There are currently 137 ethanol plants operating, with another 62 plants under construction and eight undergoing expansion. If all those plants and expansions come on line, the total U.S. capacity would rise to about 13.3 billion gpy. 

The high cost of adding infrastructure has thus far limited investment in new terminals and formed some bottlenecks in the system, but tax breaks or state mandated minimum blending requirements could spur additional infrastructure investment. 

An executive at CSX Transportation, a unit of CSX Corp. , told Reuters that it plans to build three ethanol terminals this year in the southern United States, which is seen as the next likely growth area for the U.S. ethanol market. 

Union Pacific Corp , which runs the largest U.S. railroad, views expansion of destination terminals as "one of the key pieces of our strategy," Paul Hammes, UP's vice president and general manager for Agricultural Products, said at the summit on Monday. 

"I see it as a very gradual ramping up of terminals and I think we will have a lot of inefficient moves in the interim, but it's not unlike what happened in the coal industry or the grain industry," Williamson said. 

"Mandated blending is certainly going to draw the investment because the petroleum companies will pay whatever it is that they have to pay to get the ethanol in order to meet that requirement," he said. 

Fuel blends in the enormous California market are set to increase in late 2009 to include up to 10 percent ethanol, while Florida, another key fuel demand market, is poised to begin blending more ethanol into its fuel supply. (For summit blog: http://summitnotebook.reuters.com/ )


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## Gutovsky

Ethanol use in the US will not increase because of the huge subsidies ganted to oil. It would be much better to gradually decrease such subsidies gradually, as they're moved toward local-producing Ethanol farmers. It's better than financing the spectacular growth of Arab nations or local power-thirsty dictators-to-be such as Chávez in Venezuela.
Besides, Brazil implemented a large-scale ethanol use back in the '70s (as stated before), but it wasn't untill the late '90s that it really became largely popular, mainly due to bi-fuel cars (which run in any mixture of ethanol and gas), that have really layed the competition between the two fuels according to market rules, and the high prices of oil. It wasn't just because of government action, it was a market-oriented turn of events.


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## hkskyline

*Poll says farmers have concerns on using corn stover for ethanol *
19 February 2008

CEDAR RAPIDS, Iowa (AP) - Proponents tout left over plant materials from corn harvest to make ethanol as an environmentally friendly way to produce the renewable fuel. But a new poll shows that many farmers are concerned that the practice could lead to soil erosion. 

The Iowa State University Extension polled farm operators on the issue in the 2007 Iowa Farm and Rural Life Poll. Seventy-five percent of the nearly 1,100 respondents said that removing the plant residue, called corn stover, will increase soil erosion. 

David Laird, a professor in the ISU Department of Agronomy, agrees with the farmers and writes in a report that although corn stover is often referred to as waste, it is a vital component of soil agrosystems. 

"Crop residues contain substantial amounts of plant nutrients. If crop residues were harvested every year, these nutrients would have to be replaced by increased fertilizer use," he said in his report. "If all aboveground crop residues were removed year after year, the quality of our soils would rapidly deteriorate." 

Laird's report is titled "The Charcoal Vision: A Win-Win-Win Scenario for Simultaneously Producing Bioenergy, Permanently Sequestering Carbon, while Improving Soil and Water Quality." 

The Iowa Farm and Rural Life Poll has been conducted annually since 1982. The 2007 poll focused on the bioeconomy and its impact on Iowa farming. The ISU Extension mailed a questionnaire to a statewide panel of 1,473 farm operators and surveys were returned by 1,095 producers, for a response rate of 74 percent. 

They were asked to rank their level of agreement on a five-point scale ranging from "strongly disagree" to "strongly agree." 

Moving the state toward energy independence was considered a worthy goal by 86 percent of the respondents, and 77 percent said Iowa should lead the country in research and innovation on the bioeconomy. 

While almost half of the farm operators said ISU's top research priority should be biorenewable energy, 75 percent believed that research on biofuels should not take the place of traditional crop and livestock research.


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## hkskyline

*Corn-derived biofuel already has dramatically altered the economic reality of the American heartland and promises boom times for Ontario farmers. 
But how can we possibly keep up with demand? And what about the spiralling cost of food?*
March 16, 2008 
Murray Whyte
Toronto Star

NEAR MELBOURNE, ON–In the deep cold of the too-long winter here, ice pools in the fields just outside Larry Cowan's two-level backsplit, creating a worrying, if not unfamiliar, predicament. 

"We get concerned about that," says Cowan, squinting, as he guides his truck along the salty blacktop that quilts the tilled earth here into tidy packages of farmland. "That's got to disappear real quick."

It's nothing Cowan hasn't seen before; 32 years spent on his own 728 hectares here at Chimo Farms, growing corn, wheat and soybeans, don't leave a lot of room for surprise. Out here in the fields, at least. 

Back inside is a different story, courtesy of an unlikely source: The business report on CNN. 

"The head of one of the big investment firms in New York City was talking about gold going to $1,000 an ounce," Cowan recalls, his eyes wrinkling with a pinched smile. "And then he talked about Chicago corn going to $6. And that is the first time I ever, in 32 years, have ever, ever heard a stock broker talk about corn in the same breath as gold. So there's some frenzy in the marketplace, yes."

Cowan, laconic and soft-spoken, carries with him a certain world-weariness that is the farmer's right. Things are never easy in the world of agriculture, and Cowan, like most of his kind, tends to temper any enthusiasm with a strong dose of common sense, if not outright pessimism.

IN THE '80S, with interest skyrocketing and commodity prices bottoming out, it was all Cowan could do to stay afloat. "We almost went bankrupt," he grins. "But we managed to rejig and survive."

Cowan can be forgiven a touch of skepticism. But at the same time, in the corn patch, this is an historic moment. It is the stuff of pure paradox: An agricultural boom. Corn prices have soared in the past year, both here and especially in the U.S., where the industry standard Chicago Exchange pegged it around $5.75 (U.S.) a bushel. As recently as November, it was hovering around $3.50, and a year before that, under $3. And it has dragged soybeans and wheat up along with it, both of them up more than 50 per cent in the past year. 

Cowan has seen prices jump before. In 1997, corn leapt briefly to $7, due largely to a drought that crippled supply, before it crashed back down. "That's what history teaches us," Cowan sighs. 

This time, there is no drought, no blight, no yield disaster making corn stocks much coveted in the face of scant supply. Some point to a growing appetite in China and India, and they do play their part. But that would be ignoring the elephant in the room, growing fatter by the day. 

Ethanol, the corn-derived alcohol now being used as a gasoline additive by most big retailers, has already drastically altered the economic reality of the American heartland. In 2005, the Bush administration introduced incentives for the ethanol industry meant to stimulate its growth and throw the country's quest for renewable fuel and decreased dependence on foreign oil into fast forward. 

It's a tantalizing hypothesis, and in Brazil, it's already been achieved. Already the world's biggest ethanol producer – from sugar cane – 85 per cent of the cars sold there are "flex" vehicles, which can run on either ethanol or gas. Brazil, once a voracious consumer of foreign oil, now imports not a drop. (The U.S. heavily taxes Brazilian ethanol imports to protect its own industry.)

In the U.S., the Bush plan has been working, largely to the benefit of midwestern farmers and agricultural giants like Cargill and Archer Daniels Midland, who act as middlemen between farmers and the ethanol plants, which have been coming online as fast as they can be built. 

In 2002, there were 61 plants in the U.S. Today, there are 134, producing 7.2 million gallons of ethanol a year, prompting U.S. farmers last spring to plant their largest corn crop since World War II. With 77 more under construction, and Federal production goals set at 36 billion gallons by 2022, there's no end in sight. 

Canada and Ontario have been a little slower to the ethanol craze, but they're making up for lost time. Last year, the federal government introduced a $200 million grant program for new biofuel projects, through 2011. At the same time, the McGuinty government introduced a mandate for all gasoline sold in the province to contain at least 5 per cent ethanol. That's due to increase to 10 per cent by 2010 – the highest content a conventional engine can use without modification.

It was enough incentive for Suncor, one of the founding giants of Northern Alberta's oil sands, to set up shop on the cusp of Ontario corn country in Sarnia last year with an ethanol plant of its own. "Basically, the market is growing, and that's because of the government mandate," said Jason Vaillant, a manager at the Sarnia facility. "It made more sense for us to make it ourselves than buy it from someone else." 

Suncor's Sarnia plant produces 200 million litres of ethanol a year, consuming 20 million bushels of Ontario corn in the process. Vaillant estimates that the plant consumes about 10 per cent of the province's annual corn production all by itself. When it reaches full capacity, those numbers will double. The other operating plants in the province collectively produce another 250 million litres – and consume another 12 per cent of the crop.

BUT, AS INCENTIVES lure more investors into the ethanol business, Ontario's corn supply starts looking increasingly short. Six more plants are either planned or under construction. If they all reach capacity, the province's ethanol production would jump by another 1.63 billion litres, to more than 2.2 billion, total. 

Quick math tells a potentially troublesome tale: At a ratio of 10 litres per bushel, the proposed ethanol production in Ontario would consume virtually all of the province's corn production of 250 million bushels a year. "That was a real question when we were building," Vaillant says. "Where are we going to get all the corn?"

The ethanol industry isn't the only one asking that question. Among all the crops humans grow, corn is perhaps the most essential. Of all the things in your local supermarket – more than 45,000, says Michael Pollan in The Omnivore's Dilemma – about a quarter of them contain corn. 

It is the ultimate staple in the broadest sense: It's in processed foods like cereals. Its starch is used in sauces as thickener, its sugar in soft drinks as sweetener. It's a binding agent, a colourant, the alcohol in your beer. It's in coffee whitener, ketchup, candies, canned fruit and condiments. 

Go to the meat counter and you'll find beef and pork fattened by corn feed, chickens and turkeys raised on kernels. Your eggs are laid by corn-fed hens. Commercial fish feed is largely corn-based, and even the carnivores among them, like salmon, have been sufficiently genetically engineered to be raised on a corn-based diet. 

And forget about just the things you eat: Corn is in toothpaste and lipstick, eyeshadow and batteries, diapers, cleaners, plastic products, paper and cardboard. Touch the grubby drywall at your local super-grocer, smudged with the fingers of a thousand errant children, and you'll be in direct contact with it: Corn is a binding agent in plaster products, too. 

Ancient civilizations, like the Mayans, were built on its nourishment, and Third World countries remain dependent on it. This is the ugly side of the corn boom: Food and fuel economies are intertwining, and the market is revealing an unpalatable truth about which one the markets deem to be more essential. 

Rising corn prices to feed the ethanol industry invariably impact food prices, too. And the entire chain can be disrupted. 

Hog and beef producers are suffering badly due to the high price of corn-based feed. Last week U.S. Pilgrim's Pride, one of the country's biggest poultry producers, cut 1,100 jobs and closed one of its massive processing plants and half its distribution centres. Its justification: "Unprecedented increases" in feed costs. 

And this is relatively comfortable First World suffering at the hands of the corn boom. In Mexico, where corn is a revered component of an ancient diet – until recently, it was considered sacrilege to feed it to animals – large-scale protests about the cost of tortillas, a Mexican diet staple made from corn flour, have become commonplace, touched off when 75,000 took to the streets of Mexico City last year when tortillas quadrupled in price in just a few months. Once again, the voracious U.S. ethanol industry was cited as the culprit.

IT ALL SERVES as something of a cautionary tale to Ontario's still-nascent ethanol industry. Ontario corn, by its own description, is "basically an in-house operation," Cowan says. Very little is exported; almost none is imported. But in an ethanol-fuelled future, that will have to change. 

"If we had a below-average yield one year, where would it all come from?" asks Bill Deen, a professor in the plant agriculture department at the University of Guelph. 

Deen, who studies cropping systems and agronomy in the province, doesn't see a solution. "Virtually all the farmable land base in the province is in use," he says. "What we're using is pretty much it." 

That means increasing demand would mean stealing it from other crops, upsetting rotations and potentially damaging yields. And current prices provide a potent incentive. 

How times change. Two years ago, Deen was recruited by the Ministry of Agriculture to give a series of talks to farmers about the importantance of keeping up their corn production. 

"The price was so low, growers were looking at a loss," he recalls. "They couldn't possibly make money."

A year later, with prices spiking alongside the U.S. ethanol boom, Deen had a new message: "I had to tell them 'don't grow too much corn – you need to maintain a rotation to keep your crops healthy,'" he says. 

The lure is certainly there. For Rick McCracken, who farms his 769 hectares with his wife Betty just outside Melbourne, boom times have spread the wealth around. In the buoyant corn economy, everyone prospers.

"If you want to buy a tractor or a combine, you're going to have to wait until next year to see it," he says. McCracken, who's also a seed dealer, shares Cowan's leavened optimism. "It's an exciting time," he says. But the disaster years of the '80s, when high interest rates drove over-leveraged farmers into bankruptcy by the dozens, are never far from mind. 

"We're only a few months into this. We don't want to get too optimistic and see it happen again." 

One thing they don't have to worry about is the crop itself. A remarkably adaptable, hearty crop that spread from Mexico into Ontario long before the arrival of Columbus, corn has natural genetic variability that allows it to grow and flourish in almost every climate imagineable. In the agricultural world, corn is relatively reliable, thanks to genetic engineering, drought and disease are no longer major concerns.

BUT OVER-GROWTH has consequences, Deen says, and not just because of basic agronomy. Crops are rotated – beans one year, corn the next – to keep one or the other from depleting the soil of the different nutrients they require. 

Corn-based ethanol , to those who follow the industry, contains a central paradox: Among the crops grown here, corn is the most machine intensive and demanding, spewing exhaust into the air to collect the very material meant to deliver us into a carbon-neutral fuel future. Corn also cries out for more herbicides and nitrogen fertilizer than any other crop, and erodes soil more quickly than any other as well.

For all the hype, the future of corn-based ethanol is less than assured. Research is pouring into deriving ethanol from less intensive, non-food crops like prairie grass, and even crop waste. 

"That, at least, makes sense," says Ann Slater, the president of the Ecological Farmers' Association of Ontario. "I haven't seen anything that leads me to believe that corn-based ethanol is in any way sustainable, here or anywhere else." 

Cowan has seen too much, been here too long, to buy into hype. He's rotating his crop as per usual this year, reducing corn acres and increasing beans. Despite the frenzy, most responsible farmers will do the same, he says. 

"All it takes is a stroke of the pen from a new U.S. president to lower that tariff on Brazilian ethanol, and it's over," he says. 

Jitters reverberate through the market. Earlier this month, buyers, wary of betting too much on corn's upswing, pulled their bids for 2009/2010, fearing overpayment and a drop in a price that, by all accounts, seems only to be going up. "It's volatile," Cowan shrugs. "I guess they're getting a little nervous." 

Under a slate-grey March sky, Cowan pulls his truck into his storage area, where corrugated metal silos store last year's grain. Birds wheel overhead, dropping earthward to light on the frozen ground to peck at the kernels scattered in the muck. 

Here, surrounded by the fruits of his long labours, Cowan allows the unshakeable pragmatism he has cultivated for the past 32 years to soften. Slightly, at least. 

"Optimistic? I don't know if I'd say that," Cowan allows. His eyes wrinkle again with that smile. "Let's call it optimism, with a side note note of caution."


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## Svartmetall

Ethanol as a biofuel is a bit of a con. The net energy release from corn derived ethanol is very low and is only just positive (it even comes out as negative in some studies). Also, if EVERY SINGLE food crop in the USA was switched over to corn for biofuel production only 13% of petrol demand in the USA would be satisfied. 

Great for augmentation but not so good for long term oil replacement. 

I'm a much larger fan of biodiesel from soybeans as the net energy benefit is much greater though again it can't satisfy total demand. New technologies must be at the forefront of peoples minds rather than continuing to rely upon the internal combustion engine.


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## ChrisZwolle

In Europe, there is a Volkswagen which runs 30km on one liter of petrol. That's about 70 miles per gallon. But nah, that car doesn't do anything for me. It's a small box without any luxury or safety options. A slowpoke's or elderly car. 

I expect more from a better electrical power car, like the Toyota Prius.


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## storms991

Anybody think of the cost of food? It has increased quite a lot over the past couple of years, almost 10-20% in my area.


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## Whiteeclipse

No I don't think ethanol could reduce American oil dependence but there seems to be alot of research to make fuel from algae which appears to be sustainable.

http://youtube.com/watch?v=_ToojK_MJd0


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## Xusein

Ethanol is a scam.


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## storms991

Whiteeclipse said:


> No I don't think ethanol could reduce American oil dependence but there seems to be alot of research to make fuel from algae which appears to be sustainable.
> 
> http://youtube.com/watch?v=_ToojK_MJd0


Is the government subsidising that though? If they don't promote it as they did with corn growing, the farmers will continue towards planting the cash crop.


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## butch83

Well Ethanol can be made out of some chemical reaction, not only fermentation. Cost of producing 1l 96%ethanol from synthesis is about 1$(gallon 3.8$)
Cost of fermented alcohol is 1.5$/l so the difference is quite big.

The other solution is Methane, it is way better than ethanol, cheaper, more enviromental friendly, and can be produced virtually of any organic piece of shit.


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## hkskyline

*EU defends biofuel goals amid food crises *

BRUSSELS, April 14, 2008 (AFP) - The EU Commission on Monday rejected claims that producing biofuels is a "crime against humanity" that threatens food supplies, and vowed to stick to its goals as part of a climate change package.

"There is no question for now of suspending the target fixed for biofuels," said Barbara Helfferich, spokeswoman for EU Environment Commissioner Stavros Dimas.

"You can't change a political objective without risking a debate on all the other objectives," which could see the EU landmark climate change and energy package disintegrate, an EU official said.

Their comments came amid growing unease over the planting of biofuel crops as food prices rocket and riots against poverty and hunger multiply worldwide.

UN Special Rapporteur for the Right to Food Jean Ziegler told German radio Monday that the production of biofuels is "a crime against humanity" because of its impact on global food prices.

EU leaders, seeking to show the way on global warming, have pledged to reduce carbon dioxide emissions by 20 percent by 2020.

As part of a package of measures the 27 member states have set a target of biofuels making up 10 percent of automobile fuel by the same year.

"We don't have an enormous danger of too much of a shift from food production to biofuels production," said Michael Mann, spokesman for EU Agriculture Commissioner Mariann Fischer Boel.

Mann, like Helfferich speaking to reporters in Brussels, stressed that the 10 percent target would in part be achieved through higher yields and increased production.

Ziegler also accused the European Union of subsidising its agriculture exports with effect of undermining production in Africa.

"The EU finances the exports of European agricultural surpluses to Africa ... where they are offered at one half or one third of their (production) price," the UN official charged.

"That completely ruins African agriculture," he added.

In recent months, rising food costs have sparked violent protests in Cameroon, Egypt, Ethiopia, Haiti, Indonesia, Ivory Coast, Madagascar, Mauritania, the Philippines and other countries.

In Pakistan and Thailand, troops have been deployed to avoid the seizure of food from fields and warehouses, while price increases fuelled a general strike in Burkina Faso.

The European Environment Agency, advisors to the European Commission, on Friday recommended that the EU suspend its 10 percent biofuels target.

It argued that the target would require large amounts of additional imports of biofuels leading to the accelerated destruction of rain forests. The agency also questioned the environmental benefits of biofuels.

Also in a recent report the World Bank said bluntly "biofuel production has pushed up feedstock prices".

Meanhwile Peter Brabeck-Letmathe, head of Nestle, the world's biggest food and beverage company, last month argued that "to grant enormous subsidies for biofuel production is morally unacceptable and irresponsible."

"There will be nothing left to eat," he added.

European leaders are aware of the growing body of opinion opposed to biofuels but Dimas has stressed the use of "second generation" biofuels; including leaves, straw and pond algae.

The first generation of green fuels -- biodiesel and ethanol-- are made from wheat, maize, colza, sugar beet etc, also used for human and animal feed.

However, according to French Ecology Minister Nathalie Kosciusko-Morizet, the methods for utilising the second generation sources are far from complete.

"That will take 10 to 20 years," she told AFP.

The 27 EU nations are due on May 7 to approve strict criteria for the production of biofuels, according to the European Commission.

Speaking in Luxembourg on Monday French Agriculture Minister Michel Barnier, meeting with his EU counterparts, said that food production must be the priority.


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## hkskyline

*US ethanol policy under siege in food-for-fuel debate *

WASHINGTON, May 21, 2008 (AFP) - Amid a surge in food prices blamed in part on US expansion of corn-based ethanol production, lawmakers, experts and industry officials are urging the government to rethink a new law mandating alternative fuels.

The United States is the world's top producer of corn-based ethanol, which the administration of President George W. Bush sees as a way of reducing dependence on foreign oil and curb fossil-fuel emissions, the main source of man-made global warming.

Politicians are under mounting pressure to look again at the effects of a landmark energy law enacted in December that raised vehicle fuel-efficiency standards for the first time in three decades and offered broad support for ethanol production.

The public outcry over using food for fuel has spurred interest in so-called "second-generation" alternative fuels, such as cellulosic-based ethanol, but they are still in an early stage of development.

"The solution to the issue of corn-fed ethanol is cellulosic ethanol, which is a fancy word for saying we're going to make ethanol out of switchgrasses, or wood chips," Bush said last month.

This week the US Department of Agriculture argued ethanol production does not pit food and energy interests against each other.

Agriculture Secretary Ed Schafer said the effects of skyrocketing oil prices are an "often overlooked" major factor on food prices.

Oil costs for processing, packaging, transportation and other steps that bring food from farms to the marketplace account for about 80 cents of each retail food dollar, with the actual commodity only accounting for 20 percent.

With crude oil crashing through a series of price ceilings this year, Schafer said, "developing diversity in our portfolio of fuels is, if anything, an even more urgent matter than it has been in the past, and it is one that remains central to both our energy security and our national security."

While corn is the feedstock for over 90 percent of ethanol produced in the United States, foods using corn as an ingredient make up less than a third of retail food spending, he said.

And because processed foods represent such a large part of the diet in the US, a single ingredient typically has only a small impact on the retail food price, he said.

Schafer said that consumers in the US are fortunate to be dealing with moderate food price increases. US food prices increased about 4.0 percent higher in 2007, up from an average annual rate of 2.5 percent since 1990, and are expected to rise 5.0 percent this year.

By contrast, in low-income developing countries basic foodstuffs represent the bulk of the diet and consume the lion's share of household income.

On the international level, Bush's Council of Economic Advisors estimates that three percent of the more than 40 percent increase in global food prices this year is due to the increased demand on corn for ethanol.

Other factors sending food prices higher include weather problems, trade restrictions and heavy demand in developing countries, such as China and India.

The Democratic-controlled Congress has held several hearings in recent weeks to explore calls for a change in the energy law that mandates a six-fold increase in the use of ethanol, to 36 billion gallons (136 billion liters) a year by 2022, and the blending of corn-based ethanol into the nation's fuel supply.

Two dozen Republican senators have signed a petition asking the Environmental Protection Agency to consider waiving the mandate.

Nineteen organizations -- ranging from the Grocery Manufacturers Association and the American Meat Institute to Friends of the Earth and Oxfam America -- urged Congress in an open letter to "quickly transition toward supporting solutions that don't pit our energy needs against our food needs."


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## hkskyline

*Ethanol's turmoil could prove a serious threat to some companies *
21 May 2008

CHAMPAIGN, Illinois (AP) - Not long ago, the fledgling ethanol industry was the darling of investors, farmers, the federal government and a lot of Americans who liked the idea of turning corn into fuel.

But suddenly, it doesn't have nearly as many friends.

Rising worldwide food prices and shortages have spurred calls in Congress to roll back the federal requirement that increases the amount of ethanol and other biofuels blended with the nation's gasoline supply. Critics say so much corn is being used for ethanol that there's less available for people and animals to eat, raising prices of everything from tortillas to meat.

What's more, investors who bought into the industry in good times aren't seeing the returns they'd hoped for as once-record profits began to fall.

"Consumers are starting to get restless and Washington is starting to listen," said Morningstar analyst Ann Gilpin, who follows Decatur, Illinois-based Archer Daniels Midland, the second-largest U.S. ethanol producer.

The ethanol market would be severely limited if Congress rolled back the federal mandate that calls annual increases in the amount of biofuels added to the fuel supply -- 9 billion gallons by the end of this year, increasing to 36 billion gallons by 2022.

That would most hurt companies that rely exclusively or primarily on ethanol, which include a mix of small, often locally owned distillers -- already under pressure since ethanol prices fell and corn prices rose sharply -- as well as larger publicly traded firms like VeraSun Energy Corp., the top U.S. ethanol producer.

"If you sell one product and the only reason there's a market for it is because the government makes a law requiring consumption -- if that law goes away, obviously you're in trouble," Gilpin said.

The odds of Congress changing that mandate this year are slim because the 10 states -- mostly in the Midwest -- that produce over 80 percent of all American ethanol have between them almost half of the 270 electoral votes needed to win a presidential election, said analyst Kevin Book of Friedman, Billings, Ramsey & Co.

After the election, though, sentiment could change.

"I think we're still a long ways from anything actually being done on it, but at the same time there is a lot more serious support than there was at this time two or three years ago," said Rick Kment, an ethanol-industry analyst for agricultural data company DTN.

Congress was already willing to take a modest swipe at ethanol when it approved a farm bill this month with a provision that would shave a tax credit for refiners that blend ethanol into their gasoline from 51 cents to 45 cents. President George W. Bush vetoed the bill Wednesday, but since it had passed the House and the Senate with veto-proof majorities, his action was likely to be canceled out by new votes.

Investor disappointment also is weighing on ethanol-only companies, particularly those that are smaller and privately held, Kment said.

He said much of the public and private investment was made when profits were at record levels -- $2 (euro1.27) a gallon (3.8 liters) in some cases, meaning even a very small plant that distilled half a million gallons a year would clear $1 million (euro630,000).

"It is very unlikely we will see that kind of profit again," Kment said.

Shares of Brookings, South Dakota-based VeraSun have fallen more than 15 percent since April 1, and Pacific Ethanol, another major biofuels maker, has seen its stock drop by about 30 percent in the same period.

After VeraSun announced a first-quarter profit last week that fell short of investor expectations, some analysts raised worries about the pressures facing the industry.

"We remain cautious on the entire sector as we expect sustained higher corn and natural gas prices with little relief in sight," Calyon Securities' George Kotzias wrote in a note to investors. He said he was reviewing his earlier estimates of VeraSun's expected performance, while at least one other analyst downgraded his expectations.

VeraSun officials did not return a call seeking comment.

On the other hand, analysts say ethanol producers like ADM that distill the fuel additive as just one of many businesses appear better prepared to weather whatever's coming their way.

ADM doesn't break out the profit it makes from ethanol, but the division that includes the fuel additive operations accounted for about 20 percent of the company's earnings last year. In the most recent quarter, when profit in that division fell by almost a third, companywide profit increased 42 percent on the strength of ADM's other businesses.

"Today's quarter highlights the balance of ADM's model," Citigroup analyst David Driscoll wrote in a note to investors after ADM's results on April 29.

At the time ADM called the volatility in the quarter "unprecedented" as corn prices set a record above $6 (euro3.8) a bushel. But Chief Executive Patricia Woertz said retreating from biofuels would be a mistake. ADM said Tuesday that the company would have no further comment.

Ironically, the turmoil over ethanol has grown even as some of the industry's economic vital signs have been stabilizing.

Corn has eased back to about $5.90 (euro3.75). Ethanol is selling for more than it did last year but, at 60 cents to 70 cents a gallon (3.8 liters) less than wholesale gasoline, is still cheap enough to make it an attractive option for refiners looking to make their oil go further, according to Kment. And demand is steady.

Many analysts say the pressure on the industry would ease with a drop in food prices, and ADM agrees.

"I think globally it'd very good to have a large corn crop and a large oilseed crop," ADM Executive Vice President John Rice told analysts at a conference in New York last week. "I think it would eliminate some of this debate, the food versus fuel."


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## hkskyline

*ANALYSIS-US corn supply shrinks as floods ravage new crop *

CHICAGO, June 10 (Reuters) - Deluges of rain that keep pounding U.S. corn-growing areas and floods that have heavily damaged the newly sown crop already are making the government's latest dire forecast for corn output look more like an optimistic Polyanna pronouncement.

The U.S. Department of Agriculture (USDA) on Tuesday shocked the corn market, revising its forecast for national corn output down 3 percent from last month's prediction. But experts said the picture probably will get even bleaker because the bad weather will force the USDA to lower its estimate of corn acreage in addition to the lower yields per acre that were announced on Tuesday.

With demand for corn for food and fuel forging ahead while huge corn areas remain under water even as more rainstorms loom ahead, analysts see the threat of a perfect storm.

"They've lowered yields ... and now people are going to start to adjust the acreage because of the rains we've had this last week," said Roy Huckabay, analyst with The Linn Group in Chicago. "It's wildly bullish corn."

The USDA June supply/demand report trimmed its forecast for this year's crop to just over 11.7 billion bushels, down from its May forecast of 12.1 billion. If the crop comes in as forecast, it would be a huge 10 percent reduction from last year's record crop of over 13 billion bushels.

The USDA tweaked its forecast earlier than some had expected as it cut corn yields by 5 bushels per acre but left the corn acreage unchanged at 86.0 million.

"The biggest surprise is how aggressive USDA was in dropping yield, it's the second biggest drop (ever). It only magnifies how much in jeopardy this crop is, it's starting off on the wrong foot for 2008," said Joe Victor, analyst for Illinois-based research and advisory firm Allendale Inc.

USDA also cut its outlook for the corn supply at the end of next summer (Aug. 31, 2009) to only 673 million bushels, the lowest in 13 years, a three-week supply and roughly half the expected stockpile at the end of this summer at 1.433 billion.

Torrential rainfall has damaged the crop in the heartland of the world's largest corn-producing country at a time every bushel is needed to meet the soaring demand for food and fuel.

Corn is the root stock for the growing U.S. ethanol fuel industry so the current market and weather turmoil in the Corn Belt is bound to stir further controversy about the use of corn as fuel versus feed and food.

U.S. corn prices on Tuesday soared to a record high of $7.20-1/2 per bushel for July CN9> futures in the new-crop marketing year. Persistent rains and flooding in key corn states Iowa, Illinois, Indiana, Nebraska and Missouri should make the crop outlook more precarious and send corn prices still higher.

"The yield reduction was probably greater than what was anticipated, but here again, we have a lot of problems out in the country," said Shawn McCambridge, analyst for Prudential Financial. "We didn't see any acreage reduction, so that still remains a possibility."

CORN DEMAND FOR FUEL/FOOD HUGE DESPITE HIGH PRICES

The ethanol fuel industry next year is expected to use 4.0 billion bushels or nearly 35 percent of the corn crop -- up 33 percent from this year when 3.0 billion bushels of corn will be used as fuel, 23 percent of the crop, according to the USDA.

The U.S. Renewable Fuels Association said ethanol capacity at 8.8 billion gallons is 40 percent more than a year ago as producers expect government mandates and record oil prices to help open new markets for the alternative fuel.

As ethanol output booms, corn earmarked for exports is expected to slide and beef, pork and chicken producers are scaling back meat output because the record high corn prices are boosting feed costs and squeezing profit margins.

USDA said corn exports next year are expected to be 2.0 billion bushels, almost 20 percent less than this year.

On June 30th, the USDA will release an updated forecast for the amount of corn to be used by livestock and poultry feeders. Corn prices at record highs and nearly 75 percent above a year ago are bound to trim the amount being fed, reducing the output of beef, pork and poultry and likely boosting the price for each at the grocery store, the analysts said.

The stock price for leading U.S. chicken producer Pilgrim's Pride Corp fell over 10 percent early this week because of high corn prices and weak chicken prices, analysts said.

Shares of No. 2 producer Tyson Foods Inc. and No. 4 producer Sanderson Farms Inc also fell. The No. 3 U.S. chicken producer, Perdue Farms Inc., is not publically traded.

"Corn is the big thing and demand (for chicken) is ho hum so far this summer," said Len Steiner, a food industry consultant for Steiner Consulting Group referring to the declines in stock prices.


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## hkskyline

*U.S. biofuels industry presses for tax breaks *

WASHINGTON, June 11 (Reuters) - The biofuel industry will need government support such as tax incentives to help develop the next generation of fuels and move away from crop-based production, industry officials told lawmakers on Wednesday.

One key concern is the looming expiration on Dec. 31 of the biofuel tax credit, they said, contending investors would get the wrong signal if the government does not extend the credit.

"Everyone really relies on private equities, banks to fund this technology," Jeffrey Trucksess, executive vice president of Green Earth Fuels, told members of the House Subcommittee on Rural and Urban Entrepreneurship.

"You start giving unstable policies and they pull back their money, and they don't start up again next year when you change the policy," he said of investors.

Trucksess urged subcommittee members to push Congress for a long-term extension of the the credit that provides $1 per gallon of biodiesel produced from virgin oils and 50 cents per gallon of biodiesel produced from recycled oils.

He said it was critical for the renewable fuel mandates to remain in place as it had "stimulated a lot of investment."

Under the 2007 energy bill, U.S. ethanol production is required to rise from 9 billion gallons in 2008 to 36 billion gallons by 2022.

The new U.S. farm bill also provides $1.2 billion for biofuel development, particularly for ethanol from cellulose.

Ethanol production is expected to consume more than one-third of the U.S. corn crop this year, which some blame for helping to ignite food inflation around the world.

Second generation biofuels would hush some critics, shifting production from corn-based to cellulosic ethanol, which relies on inedible products such as wood chips, corn cobs and grasses, to produce energy.

The subcommittee showed bipartisan support for the advancement of biofuels.

"Small firms should be given the opportunity to innovate in this critical area of the economy," said Subcommittee Chairman Heath Shuler, a Democrat from North Carolina. "Supporting biofuel production by family farmers and other entrepreneurs is not a novelty. It's a win-win proposition for the U.S. taxpayer."

Republican Rep. Roscoe Bartlett of Maryland said, "We need a program that has the total commitment of World War II, the technology focus of putting a man on the moon, and the urgency of the Manhattan Project."

Tom Todaro, CEO of Targeted Growth, said technology advances and the ushering in of third generation biofuels could mean "infinite" production of biofuels.

He said his company was making technological advances and hoped to produce 100 million gallons of fuel from the camelina seed -- from the mustard seed family -- by around 2011 and that level could double over time.

Scott Barnwell, general manager of Blue Ridge Biofuels, said, "We can produce fuel as long as there's feedstock to produce it from."

But Bartlett said he was concerned about "unrealistic expectations" since the sustainability of biomass has not been proven.


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## hkskyline

* Ethanol plants shut on record corn price: Citi*
Reuters
Fri Jun 13, 10:34 AM ET

Record corn prices pushed up by flooding in the Midwest have forced five small to mid-sized U.S. ethanol plants to shut and output of the biofuel could be slowed for months, a Citi research note said on Friday.

Storms this week have dumped rain on crop fields across the Midwest, where much of the world's food is grown. Corn prices have shot to a record near $8 per bushel, nearly double last year's price.

As much as 2 billion to 5 billion gallons of ethanol "could go offline in the next few months due to high corn prices," the note said. The United States has an ethanol production capacity of about 8.8 billion gallons per year from 154 distilleries.

"Corn prices have witnessed a structural shift, and are now confronted with near-term supply concerns associated with flooding in the Corn Belt," said Ron Oster, an analyst at Broadpoint Capital in St. Louis.

The Citi report did not say which companies had shut plants.

Citi has downgraded investment ratings on pure ethanol producers VeraSun (VSE.N) and BioFuel Energy (BIOF.O) to "sell" from "buy."


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## chazman

Corn is not the best source out there and its use is only leading to more food inflation. There are parts of the U.S. though that are ideal for growing switchgrass which has been mentioned as a source of ethanol and this can be done in places that are not as needed for food production. From what I've read algae has real potential as well (at least in the production of jet kerosene). 

Overall though the lead for alternative fuel sources will have to come from some place outside of the U.S. We are just too much under the hand of big oil over here and unless those companies take a lead in alternative fuels (and it appears they are not) not much will get done in the U.S.


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## hkskyline

*Ethanol mixes finding way into traditional tanks *
30 June 2008

GRANITE FALLS, Minnesota (AP) - To save money and support local corn farms, some Americans have begun mixing gasoline and cheaper, ethanol-based fuel in their cars, driving first to the gasoline pump, and then to the ethanol pump.

It has worked so well for Scott Dubbelde, who manages a local grain elevator in this Minnesota town, that he now mixes fuels for all three of his family cars, though only one was designed to handle ethanol-heavy blends.

The practice has caught the attention of the Environmental Protection Agency as a handful of filling stations install pumps that allow drivers to select different ethanol blends with the push of a button.

Auto manufacturers warn that ethanol can corrode fuel lines and damage hoses, seals and the fuel pump in cars not made to carry ethanol. That can lead to bad gas mileage, poor performance and may even affect the vehicle computers that warn of problems.

The EPA says it can damage emission control devices.

Yet with the price for a gallon of gas hitting a string of record highs this year, motorists are paying little heed, even at the risk of voiding their warranties.

"It works good, real good," Dubbelde said of the blends he uses in a Toyota and a Buick, which he improved through a couple years of experimentation. "No 'check engine' light comes on. I don't even think there's a difference in mileage."

The local Cenex gas station installed special blender pumps after managers saw customers mixing their own fuel just like Dubbelde.

Motorists at the station in this western Minnesota town can press a button and fill up with E85, a fuel mixture with up to 85 percent ethanol, or blends varying from 20 percent to 50 percent ethanol. There is little physical difference, except that blending pumps have buttons offering increasing levels of ethanol rather than 87-or 89-octane gas.

Dubbelde pumped E30 into his Buick Rendezvous SUV. He uses E20 in the family's Toyota Avalon and pumps up to 85 percent ethanol into his flexible-fuel pickup truck.

The savings at the pump are real. While regular gas was $3.93 a gallon ($1.03 a liter) at Cenex recently, E85 was going for $3.23 (85 cents). E20 was $3.81 a gallon ($1 a liter), E30 was $3.71 (97 cents) and E50 was $3.52 a gallon (92 cents).

In some Midwestern states, E85 can be as much as a dollar cheaper per gallon (3.8 liters) than gasoline.

A few dozen gas stations in at least four states -- Minnesota, Wisconsin, South Dakota and Kansas -- have the new blender pumps. More stations are beginning to ask about them.

Since two Cenex gas stations in Granite Falls and nearby Montevideo installed pumps in late March, overall ethanol sales at the stations have doubled, said Robin Enevoldsen, who manages promotions for the stores.

"At first we were seeing just basic, die-hard ethanol promoters and supporters using them," Enevoldsen said. "Now we see a large percentage of our community using them."

Ethanol advocates acknowledge that there is some misuse of the fuel.

"What an individual does is very difficult to control at the point of sale," said Tim Gerlach, assistant executive director for the Minnesota Corn Growers Association. "I think any retailer will tell you that misfueling is not an uncommon occurrence."

That concerns automakers, who say owners of conventional vehicles are putting their vehicle components and their warranties at risk.

The Alliance of Auto Manufacturers fears new blender pumps will confuse drivers, spokesman Charles Territo said.

"The best way to expand ethanol use is to expand the number of gas stations that offer E85 and not through the use of midlevel blends that could damage conventional vehicles," Territo said.

The EPA said that using blends that contain more than 10 percent ethanol in conventional vehicles could actually increase emissions and therefore violates the Clean Air Act.

"We are aware of this potential misfueling but cannot discuss specific investigations in process," EPA spokeswoman Roxanne Smith said in a written statement. "The EPA is working with industry sectors and states to assure compliance."

Robert White, of the Ethanol Promotion and Information Council, predicts demand for blender pumps will continue to rise. The Omaha, Nebraska-based group offers $5,000 grants to encourage more gas stations in South Dakota to bring blender pumps on line. The South Dakota Corn Utilization Council and the ethanol industry are paying for the grants.

"The premise behind it is offering consumers a choice, because they're screaming for it," White said.

Advocates cite studies showing that vehicles can do just as well on 20 percent or 30 percent ethanol as they do with 10 percent.

Gas mileage decreased very little on midlevel ethanol blends compared with gasoline containing 10 percent ethanol -- the standard fuel in Minnesota -- and the car's components seemed to handle the fuel fine, said Bruce Jones, a researcher at Minnesota State University, Mankato, who has helped lead the studies. Even on flexible-fuel vehicles, gas mileage was often better with a lower grade of ethanol than E85.

Jones, a professor who directs the Minnesota Center for Automotive Research, says more study is needed on ethanol blends, including on emissions. But from what he's seen, he's confident that states like Minnesota will be able to move ahead with plans to eventually mandate 20 percent ethanol in all gasoline sold.

General Motors Corp., Ford Motor Co. and the Chrysler Group have pledged to double production of flexible-fuel vehicles by 2010, and there are also efforts to put flexible-fuel hybrid-electric vehicles on the market.

In rural Minnesota, where daily corn and soybean prices are read over the radio and grain silos far outnumber Toyota Priuses, motorists are not waiting.

"The word is starting to get around," said Rodney Gaffney, a Yellow Medicine County farmer who puts ethanol blends in his flexible-fuel pickup truck and occasionally in his '97 Buick Park Avenue. "We need to keep the money in rural America instead of overseas."


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## japanese001

The ethanol causes warming and a food crisis.
U.S.A. must stop car society.


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## davsot

hkskyline said:


> Perhaps they should reconsider more research into algae-based fuels ... plenty of that in our waters, especially due to the excessive pesticides and feeds we pour into the ground that end up in our lakes and rivers.


yea! that's true...


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## hkskyline

*Waste could be crucial in search for cleaner fuels *

LONDON, Jan 30 (Reuters) - What we throw away could soon be used to power our cars, if projects to produce ethanol from commercial waste are ramped up.

Some companies are exploring the environmental and financial benefits of putting waste to good use and are developing technology to produce bioethanol.

Magazine paper company UPM Kymmene and renewable fuel supplier Lassila & Tikanoja are currently running pilot tests to produce bioethanol from the pulp-based waste created by the paper industry.

"We will start discussions with the European Union over investment support in February and hope to make a decision on a full-scale plant by the end of the year," Lassi Heitanen, senior expert at Lassila & Tikanoja, told Reuters.

By developing waste processing units, Finnish energy company St1 Oy's biofuel division hopes to produce 70 million litres a year of bioethanol by the end of 2011.

Industrial and household waste is vastly under-utilised and is usually burnt or disposed of in a landfill. Decaying waste can generate methane which is even more harmful to the environment than carbon dioxide.

Using it to produce a cleaner type of fuel could also help reach EU's target that 10 percent of the bloc' transport fuel should come from renewable sources by 2020.

Ethanol burns with a greater efficiency than gasoline, thereby emitting less carbon dioxide. The world produced 52 billion litres of ethanol in 2007, mostly in the United States and Brazil.

In a similar move to use waste efficiently, British renewable energy company New Earth Energy has partnered with waste management group Biossence to generate renewable energy in the northwest of the UK.

They want to use household and industrial waste as an energy source at two plants in the northwest of the country by 2010.


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## hkskyline

*ADM says 21 percent of U.S. ethanol capacity idle *

CHICAGO, Feb 3 (Reuters) - U.S. ethanol producer and grain processor Archer Daniels Midland Co said on Tuesday nearly 21 percent of U.S. ethanol production capacity has been shut due to weak demand and poor margins.

U.S. ethanol plants with a production capacity of 10.2 billion gallons per year are currently operating, down from 12.9 billion last year, ADM Executive Vice President John Rice said on a conference call with analysts.

U.S. capacity to make the alternative fuel rocketed last year as companies raced to build plants amid generous subsidies from the government in an effort to begin to wean the country off foreign oil.

The oil price crash and credit crunch, however, proved too much for some producers. Many also have struggled with volatile prices for corn, which most ethanol is made from in the United States.

Even with the tough times, a few plants are still opening as producers hope that U.S. mandates for traditional ethanol, which are set to increase every year until reaching a peak of 15 billion gallons per year in 2015, will help fuel demand to recover.

"We are on pace to finish our ethanol plants," Rice said about ADM's two new distilleries.

After filing for bankruptcy protection in October, VeraSun Energy Corp has shut 12 out of 16 ethanol plants. The company, which used to be the second largest U.S. producer of the fuel, suffered from costly hedging bets on the price of corn and the credit crunch.

Since then a string of plants have filed for bankruptcy protection, including a subsidiary of Panda Ethanol Inc , Northeast Biofuels and, last week, the private Wisconsin distiller Renew Energy LLC.

Under the 2009 U.S. Renewable Fuels Standard, refiners and fuel blenders are required to blend 10.5 billion gallons per year of traditional ethanol into gasoline in 2009. If U.S. capacity to make the fuel falls short, it could mean the country would have to import more ethanol from Brazil.


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## hkskyline

*Weak crude can erode ethanol exports-Cosan *

LONDON, Feb 5 (Reuters) - Continuing weak crude oil prices could mean a drop in Brazilian ethanol exports, but demand for the cane-based biofuel in Brazil is rising, said Mark Lyra, ethanol commercial director of Cosan .

Cosan is Brazil's leading ethanol exporter, which probably means that it is the world's largest, Lyra said. Cosan and another company, Vertical, in which it has a stake, together account for some 30 percent of Brazilian ethanol exports.

"If crude prices, and therefore commodity prices, remain low, we should see a drop in exports indeed," Sao Paulo-based Lyra told Reuters in an interview via email late on Wednesday.

"Especially since, on the other hand, consumption in Brazil continues to grow, providing domestic price support."

In 2008 Brazil exported some 5 billion litres of ethanol and Lyra estimated that 70 percent of this volume was fuel ethanol.

The share of sugar is likely to rise and ethanol fall in Brazil's 2009/10 crop compared with the previous year, said Lyra, who will be a keynote speaker at the February 8-10 Dubai sugar conference.

He said that 43 percent of Brazil's 2009/10 cane crop was likely to be allocated to sugar and 57 percent to ethanol.

This compared with 41 percent sugar and 59 percent ethanol in 2008/09, he added.

"Forecasting the mix for next year is a challenge because it depends not only on the strong fundamentals we see for sugar but also on the installed sugar capacity and flexibility of each mill," he said.

"Investments in recent years have been mainly in expanding ethanol production and given the amount of cane each mill must crush, product flow could be favoured over sugar production - and ethanol provides the most product flow through the mill," he added.

Cosan and Vertical's main markets today are evenly distributed among the United States, Europe and Asia -- with the United States and Europe taking a larger share of fuel ethanol versus Asia with industrial grade.


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## hkskyline

*Look who's coming to dinner: Nation's biggest refinery makes its move into ethanol*
10 February 2009

SIOUX FALLS, S.D. (AP) - If federal renewable fuel mandates require ethanol to be mixed into gasoline, the nation's largest independent oil refiner figures it might as well just do it itself.

The ethanol industry is under duress partly due to overcapacity and biorefineries can now be had for pennies on the dollar.

Valero Energy Corp. became the first conventional energy company to test the waters last week, bidding $280 million for five ethanol plants owned by VeraSun Energy Corp., which is now under bankruptcy protection.

It would be the largest ethanol buyout in U.S. history in terms of production capacity, according to Raymond James & Associates.

Cory Garcia, a senior research associate with Raymond James, said it was only a matter of time before the petroleum industry got into ethanol, much like agribusiness giant Archer Daniels Midland Co. did years ago.

"This is the first time we've seen a refiner get out there and do this," Garcia said. "If they're bullish long-term on the blending ability of ethanol, you can't beat this price."

The nation's renewable fuel standard ensures demand for ethanol by calling for 11.1 billion gallons of renewable fuel to be blended into gasoline this year, with that number climbing to 36 billion gallons by 2022.

"To this point, we've just been buying it, not producing it," said Bill Day, Valero's spokesman. "But once we realized that ethanol is likely to remain an important part of the fuel mix here in the United States, we decided to start looking at opportunities to produce it as well."

The ethanol industry has been hammered during the past year by volatile commodities and shrinking profit margins.

Those market conditions pummeled the stocks of many smaller publicly traded companies and landed VeraSun, the nation's second largest producer, in Chapter 11 bankruptcy protection.

Raymond James estimates that Valero is buying the plants for around 25 percent to 33 percent of book value.

"With all the plants and the capacity that they had, it was basically a fire sale at this point," Garcia said. "And Valero stepped in and got a very, very attractive price, in their opinion."

Valero during its history has taken advantage of opportunities created by distressed assets and bankruptcy filings, Day said.

"Right now, ethanol assets can be purchased at significant discount to what they would cost to build new because of the state of the industry," he said.

Valero's bid is for production facilities in Aurora, S.D.; Charles City, Fort Dodge, and Hartley, Iowa; and Welcome, Minn.; and a development site in Reynolds, Ind.

"The Valero bid suggests reports of ethanol's death are premature," said Oppenheimer Research analyst Joseph Gomes Jr.

Sioux Falls, S.D.-based VeraSun owns 16 biorefineries with the total capacity to produce 1.4 billion gallons of ethanol annually, or about 13 percent of the country's total capacity. Only four of those refineries -- all ones targeted by Valero -- remain operational.

VeraSun is looking to sell all of its production facilities and has set a March 13 deadline for bids. VeraSun has a plant in Hankinson, N.D.

If Valero's offer prevails, the company would group the plants under a subsidiary and use the staff already in place at the refineries.

The $280 million bid values the 560 million gallons of existing capacity at 50 cents per gallon, well below the $1.50 to $2 per gallon cost of a new facility.

That low price doesn't bode well for Aventine Renewable Energy Holdings Inc. and Pacific Ethanol Inc., ethanol companies that saw their stocks lose about 95 percent of their values during 2008, Gomes said.

"In an acquisition, the shares would appear to have little, if any, value," he said. "On the positive side, Valero is betting the industry has a future."

Gomes said more cross-industry acquisitions could be on the way.

"We would not be surprised to see additional players in the petroleum industry step up and bid on the remaining VeraSun assets," Gomes said in a research note.


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## nomarandlee

(video)
http://link.brightcove.com/services/link/bcpid1485842900/bctid9561533001

The Next Big Biofuel?A Florida farmer thinks the next big biodiesel alternative will come from the seedpods of the jatropha tree...........


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## Ro-E

totally doubting the whole biodiesel shindig. even my spell checker doesn't recognize biofuel. this means its a fat lie. growing something and then processing it to make fuel doesn't sound even remotely as efficient as solar cells and a s***load of batteries. or cold fusion for that matter.


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## hkskyline

*Obama budget proposes shift to green energy *
26 February 2009

WASHINGTON (AP) - President Barack Obama's first budget plan moves aggressively to tackle climate change and shift the U.S. from reliance on foreign oil to green energy.

The proposed budget released Thursday by the White House would rely on $15 billion a year, beginning in 2012, from auctioning off carbon pollution permits to help develop clean-energy technologies, such as solar and wind power. But Congress has yet to write a bill that would regulate heat-trapping gases and collect that money.

Across the government, Obama's commitment to dealing with climate change is apparent.

There is more money at NASA for space-based monitoring of greenhouse gases, expanded support at the Energy Department for finding ways to economically capture carbon emissions from coal-burning power plants, and more money for the Interior Department to mitigate the impact of climate change on public lands and wildlife.

The document also asks Congress to approve an additional $19 million for the Environmental Protection Agency to measure how much climate-related pollution industries are releasing.

The administration "will work expeditiously" to get Congress to approve an 83 percent reduction in global warming emissions by mid-century, the budget document says.

The administration's success on global warming will depend on a second set of priorities outlined in the budget document to reduce the nation's dependence on fossil fuels, including oil and coal, by quickening the transformation to renewable energy and development of technologies to help people use less energy.

The budget would impose a new excise tax and fees on companies that take oil and natural gas from federal waters and reimposes a tax -- again largely targeting the oil industry -- to pay for cleaning up Superfund sites.

The budget calls for "significant increases" in cutting-edge research into renewable energy, including solar, wind and geothermal sources and ways to produce non-corn ethanol, and eventually a gasoline-like fuel, from plants.

"By investing in groundbreaking research, making homes and businesses more energy efficient and deploying solar, wind, biomass and other clean energy, this budget will help ensure that America once against leads the world in confronting our global economic, energy and climate challenge," said Energy Secretary Steven Chu.

The budget calls for collecting $646 billion between 2012 and 2019 from the auctioning of greenhouse pollution allowances under a yet-to-be enacted plan to combat climate change. Democratic leaders in Congress hope to produce a climate bill this year, but there is disagreement over whether allowances should be auctioned to given to carbon-intensive industries to hold down costs.

House Republican leader John Boehner criticized Obama's auction plan, calling it "a carbon tax which will increase taxes on anyone who uses electricity, anyone who drives a car." But White House officials who briefed reporters on the budget said large portions of the money from the auctions would be used to help people offset higher energy costs.


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## hkskyline

*Ethanol to bolster US corn price, plantings-report *

WASHINGTON, March 6 (Reuters) - The expansion of the fuel ethanol industry will support U.S. corn prices and plantings this year and in the future, a University of Missouri think tank said on Friday.

Larger ethanol use is "one of the major drivers" in corn prices, said Pat Westoff of the Food and Agricultural Policy Research Institute. Because corn is the major feedstock for ethanol, larger use will bring larger plantings.

Crop prices have fallen sharply since last summer due to economic recession. FAPRI forecast this year's crop will sell for an average $3.74 a bushel, down 15 cents from the 2008 crop average but still the third-highest price on record.

Over the next few years, corn prices are forecast to rise and plantings to gradually increase. FAPRI projected an average corn price of $3.99 a bushel for the 2014 crop and plantings of 89 million acres, compared to 86.3 million acres this year.

The federal target for biofuels use is 10.5 billion gallons this year and peaks at 15 billion gallons annually from 2015.

"Starting in 2016/17, more corn is used in ethanol production than is fed directly to livestock," said FAPRI. For 2009/10, 4 billion bushels would be used for corn and 5.3 billion bushels for livestock. In 2016/17, 5.4 billion bushels would go to ethanol and 5.3 billion to livestock.

In an economic baseline book released in February, the Agriculture Department also said ethanol demand, "in combination with other long-term factors, holds prices for corn and many other crops well above their historical levels." Like FAPRI, USDA said corn plantings will rise due to ethanol.

"A gradual shift to corn away from other crops reflects the high levels of domestic corn-based ethanol production and gains in exports that keep corn demand and producer returns high," said USDA.


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## hkskyline

*U.S. ethanol prices seen rising - Merrill Lynch *

LONDON, March 6 (Reuters) - U.S. ethanol prices are likely to rise, boosted by reduced supply and growing demand, Merrill Lynch said in a report on Friday.

"Limited access to credit and low, volatile refining margins are curbing biofuels output," the report said.

Merrill reduced its estimate for global biofuels output in 2009 to 1.9 million barrels per day, down from a previous forecast of 2.1 million.

The report said mandated targets will push up consumption against a constrained supply environment.

"In our view, U.S. ethanol prices could increase against a backdrop of rising demand and falling inventories," Merrill said.

The report said that as crude oil prices recover, food and fuel competition would intensify.

Biofuels are currently mainly produced using food crops such as grains, sugar and vegetable oils.

"We believe a second round of food and fuel competition could happen as soon as next year.

"A pick-up in global oil demand next year could again drag millions of tons of corn, sugar and wheat out of the food pool into the fuel pool."


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## hkskyline

*USDA chief backs ethanol blend boost in gasoline *

WASHINGTON, March 9 (Reuters) - An increase in the ethanol-gasoline blend rate to 12 or 13 percent could be accomplished quickly and with minimal scientific review, giving a needed boost to the future of the industry, U.S. Agriculture Secretary Tom Vilsack said on Monday.

A formal request to boost the ethanol blend rate to as high as 15 percent from the current cap of 10 percent was submitted to the U.S. Environmental Protection Agency last week by Growth Energy, an ethanol trade group. The EPA has 270 days to review, collect public comment and make a decision.

"We'd love to see 15 percent. Right now my focus is on 12, 13 percent because I think it is doable more quickly," Vilsack told reporters.

"Our hope is that EPA can come to the same conclusion we have, which is that this is something that can be done within existing regulations without a great deal of time spent reviewing the science," he added.

During the review, the EPA will examine whether a higher blend would harm emission control systems, including catalytic converters, in vehicles. For now, many believe the EPA has the authority to allow a temporary jump to 12 or 13 percent before a final decision is reached on the 15 percent request.

Vilsack said he has had several conversations with EPA head Lisa Jackson and her team to encourage the agency "to take aggressive action on the blend rate." An increase to 12 or 13 percent would be a good "first step" and would help expand market opportunities and improve the stability of the ethanol industry, he noted.

Ethanol, once the cornerstone of the U.S. plan to wean itself from foreign energy, has drawn fire from the food industry and aid groups for diverting corn from livestock and foodmakers and pushing world food prices up.

Food manufacturers and livestock and environmental groups have lined up against a higher blend rate for ethanol made from corn. They say the EPA should wait until ethanol made from crop waste and grasses is commercially available.

Some analysts and the Renewable Fuels Association, an ethanol trade group, forecast consolidation among ethanol companies this year due to tighter margins and slow demand due to a drop in gasoline use.

The industry suffered a large casualty when VeraSun Energy Corp , the No. 2 U.S. ethanol producer, filed for bankruptcy in October.

An increase to a 12 or 13 percent blend rate "is a fundamentally sound and scientifically supported intermediate step that would provide some more immediate relief to a constrained US ethanol market," said Matt Hartwig, a spokesman for the Washington-based Renewable Fuels Association.

Ultimately, EPA must decide whether to change the blend rate. The USDA and other federal departments can offer advice and information.

A preliminary study released last October and updated last month by the Energy Department found emissions and exhaust temperatures in cars running on higher blends of ethanol did not change significantly from those using traditional fuels.

The DOE has been working on other studies of how the blends affect engines and emissions.


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## hkskyline

*Groups urge US govt against higher ethanol blends *

WASHINGTON, March 26 (Reuters) - A coalition of environmental, agricultural, business and consumer groups on Thursday urged the Obama administration not to raise the amount of ethanol blended into gasoline until testing is finished to determine if higher ethanol blends would cause harm.

Ethanol is required to be blended in to up to 10 percent of a gallon of gasoline, but some ethanol producers have called on the Congress or the Environmental Protection Agency to boost the blend to 15 percent even before independent and comprehensive research on higher blends are complete.

"We collectively, and strongly, oppose such an ill-considered approach as contrary to scientific integrity and potentially harmful to our environment, public health and consumers," the coalition said in a joint letter to Energy Secretary Steven Chu, Agriculture Secretary Tom Vilsack, EPA Administrator Lisa Jackson and White House energy and climate change czar Carol Browner.

The letter was signed by some four dozen groups, including the Sierra Club, American Lung Association, American Meat Institute and the National Petrochemical and Refiners Association.

Foodmaker, livestock and environmental groups are against a higher ethanol blend. Ethanol is mostly made from corn, which is also used in livestock feed and consumer food products.

To support their position, the coalition pointed out President Barack Obama's comments made earlier this month that his administration would rely on the best science when making policy decisions.

"Science and the scientific process must inform and guide decisions of my administration on a wide range of issues, including improvement of public health, protection of the environment, increased efficiency in the use of energy and other resources, mitigation of the threat of climate change, and protection of national security," Obama said at the time.


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## amidcars

That what i think about US with ethanol..Ethanol use in the US will not increase because of the huge subsidies ganted to oil. It would be much better to gradually decrease such subsidies gradually, as they're moved toward local-producing Ethanol farmers. It's better than financing the spectacular growth of Arab nations or local power-thirsty dictators-to-be such as Chávez in Venezuela. Besides, Brazil implemented a large-scale ethanol use back in the '70s (as stated before), but it wasn't untill the late '90s that it really became largely popular, mainly due to bi-fuel cars (which run in any mixture of ethanol and gas), that have really layed the competition between the two fuels according to market rules, and the high prices of oil.


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## hkskyline

*Winnebago ethanol plant considers using Minn. city's wastewater in its distillation process*
The Free Press of Mankato
28 March 2009

WINNEBAGO, Minn. (AP) - The city of Winnebago discharges a minimum of about 350,000 gallons of treated wastewater into the Blue Earth River each day.

The ethanol plant just east of town uses up to 350,000 gallons of fresh groundwater daily to produce its fuel.

The ethanol industry is facing criticism for the growing amounts of water it is sucking out aquifers across the Upper Midwest.

For officials at Winnebago's Corn Plus ethanol plant, which has made a habit of seeking innovative solutions to boost efficiency, the thread that tied those three facts together was difficult to ignore.

So Corn Plus General Manager Keith Kor talked to Winnebago officials about exploring the possibility of diverting the city's wastewater from the river to the ethanol plant.

"They really liked the idea, so I made a few phone calls," Kor said.

The calls included state lawmakers who represent Winnebago -- Sen. Julie Rosen and Rep. Bob Gunther, both Fairmont Republicans who are sponsoring state legislation to finance the cost of a pipe running from the wastewater facility to the ethanol plant.

Gunther described the bill in a House committee hearing recently as legislation for a city and an industrial water consumer "that simply wants to do what is right." The legislation seeks an unspecified amount of money, but the total is expected to be somewhere between $250,000 and $300,000 when final costs are tallied up.

State help is needed because Corn Plus has struggled to make a profit in the current economy, Gunther said. In addition, the legislation makes sense from a water resources standpoint.

"They want to eliminate some of the controversy about using water in ethanol plants," Gunther said.

That controversy is difficult to miss with numerous environmental groups and media stories describing the large water demands that ethanol plants place on aquifers. A study by the Argonne National Laboratory released earlier this year projects that water consumption for biofuels production will increase from 7.4 billion gallons a day in 2005 to more than 26 billion gallons daily in 2030.

The vast majority of that water will be consumed by ethanol production in the Upper Midwest, the report predicts. In the region made up of Minnesota, the Dakotas, Iowa, Nebraska, Kansas and Missouri, water consumption for ethanol production alone is projected to grow from under six billion gallons a day in 2005 to nearly 19 billion in 2030.

Much of the projected water use is in areas where farmers use irrigation in corn production, but water consumption for the processing of grain into ethanol is also significant. The consumption averaged six gallons of water for each gallon of ethanol in early ethanol plants, although the average has dropped to a four-to-one ratio in recent years.

Already, Corn Plus has reduced its ratio to three gallons of water for each gallon of ethanol produced.

"We'd like to get that at least down to two or even a one-to-one ratio," he said.

When looking at ground-water usage, the ratio could potentially drop close to zero if Corn Plus is able to rely almost exclusively on wastewater from the toilets, bathtubs and sink drains of Winnebago.

There's more analysis to do about the quality of the water coming from the Winnebago treatment plant and how much additional treatment might be required, but Kor is optimistic.

"Our water engineer took some samples, and preliminary indications look like it will work," he said.

Kor is unaware of any other ethanol plants using municipal wastewater as their water source, but other industrial facilities have made that transition. The Calpine power plant in Mankato is a recent example, using up to 2 million gallons a day of treated city wastewater.

"It's a wonderful reuse of water that otherwise would just be discharged in the river," said Mary Fralish, a deputy director of Public Works in Mankato. "And that kind of use is catching fire across the country."

Fralish said Winnebago or Corn Plus will need to be prepared to add some treatment technology to meet government standards for water reuse. And a decision will need to be made about whether to remove phosphorus, which isn't required for reuse but would allow for the sale of phosphorus credits to cities or industries along the Minnesota River watershed that aren't meeting pollution standards -- something Mankato is doing.

"It's really a wonderful reuse," Fralish said of the Corn Plus plan. "I hope it works out for them."

Darold Nienhaus, Winnebago's wastewater superintendent, said more research is needed to see how much additional treatment would be needed to make the Corn Plus plan work.

"There are some issues," said Nienhaus, who nonetheless is intrigued by the idea. "... It sounds pretty exciting."


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## hkskyline

*Congressional estimate: Ethanol could cost government $900 million on nutrition programs *
10 April 2009

WASHINGTON (AP) - Food stamps and child nutrition programs are expected to cost up to $900 million more this year because of increased ethanol use.

Higher use of the corn-based fuel additive accounted for about 10 percent to 15 percent of the rise in food prices between April 2007 and April 2008, according to the nonpartisan Congressional Budget Office. That could mean the government will have to spend more on food programs for the needy during the current budget year, which ends Sept. 30. It estimated the additional cost at up to $900 million.

The CBO said other factors, such as skyrocketing energy costs, have had an even greater effect than ethanol on food prices. CBO economists estimate that increased costs for food programs overall due to higher food prices will be about $5.3 billion this budget year.

Ethanol's impact on future food prices is uncertain, the report says, because an increased supply of corn has the potential to eventually lower food prices.

Roughly one-quarter of corn grown in the United States is now used to produce ethanol and overall consumption of ethanol in the country hit a record high last year, exceeding 9 billion gallons, according to the CBO. It took nearly 3 billion bushels of corn to produce ethanol in the United States last year -- an increase of almost a billion bushels over 2007.

The demand for ethanol was one factor that increased corn prices, leading to higher animal feed and ingredient costs for farmers, ranchers and food manufacturers. Some of that cost is eventually passed on to consumers, since corn is used in so many food products.

Several of those affected groups have banded together to oppose tax breaks and federal mandates for the fuel. They said Thursday that the report shows the unintended consequences of ethanol.

"As startling as these figures are, they do not even tell the story of the toll higher food prices have taken on working families, nor the impact higher feed prices have had on farmers in animal agriculture who have seen staggering losses and job cuts and liquidation of livestock herds," the Grocery Manufacturers Association, American Meat Institute, National Turkey Federation and National Council of Chain Restaurants said in a statement.

Supporters of ethanol disagreed, saying the report was good news.

"The report released by the Congressional Budget Office confirms what we've known for some time: The impact of ethanol production on food prices is minimal and that energy was the main driver in the rise of food prices," said Tom Buis, CEO of Growth Energy, an ethanol industry group.

Ethanol producers asked the Environmental Protection Agency last month to increase the amount of ethanol that refiners can blend with gasoline from a maximum of 10 percent to 15 percent, which could boost the demand for ethanol by as much as 6 billion gallons a year. They said raising that cap would create thousands of new jobs.

Agriculture Secretary Tom Vilsack has said he believes the administration could move quickly to raise the cap to at least 12 percent or 13 percent, but the EPA has not yet decided.

The report also looked at ethanol's effects on greenhouse gas emissions, concluding that over time ethanol's benefits over gasoline could diminish. The report says the use of ethanol reduced gasoline consumption by about 4 percent last year and reduced the gases blamed for global warming from the burning of gasoline by less than 1 percent. But the clearing of cropland and forests to produce more ethanol could more than offset those reductions.


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## hkskyline

*Report: Ethanol raises US cost of nutrition plans *
9 April 2009

WASHINGTON (AP) - A congressional report says the increased use of ethanol could cost the government up to $900 million for the food stamps program of income subsidies and child nutrition programs.

The nonpartisan Congressional Budget Office says higher use of the corn-based fuel additive between April 2007 and April 2008 accounted for about 10 percent to 15 percent of the rise in domestic food prices during that period. That translates into higher costs for food programs for the needy, the report said.

CBO says that other factors, such as skyrocketing energy costs, had an even greater impact than ethanol on food prices during that time. The report says ethanol's affect on future food price inflation is uncertain.

Roughly one-fourth of corn grown in the United States is now used to produce ethanol.


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## hkskyline

*U.S. ethanol capacity growth to slow in 2009-EIA *

NEW YORK, April 14 (Reuters) - U.S. growth in ethanol capacity will slow this year on softer fuel prices and as financing for new plants evaporates, the government's top energy forecasting agency said Tuesday.

The explosive growth in ethanol plant capacity over the last few years will "slow dramatically in 2009" as lower gasoline prices hurt ethanol margins, and the credit crunch halts construction plans, the Energy Information Administration said in its monthly short-term forecast.

Ethanol capacity grew about 60 percent last year amid generous government incentives and mandates calling for steep increases in the amount of the alternative fuel to be blended into gasoline.

As a result, the blending of ethanol into gasoline this summer should hit an average of 670,000 barrels per day, up from 635,000 bpd last summer, EIA forecast.

But the plant slowdowns and company bankruptcies have hurt the market since late last year. Last week Aventine Renewable Energy Holdings Inc became the latest producer to file for Chapter 11 bankruptcy protection after suffering from poor margins and declining liquidity.


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## hkskyline

*More Brazil ethanol to enter U.S. via Caribbean *

SAO PAULO, April 17 (Reuters) - Greater quantities of Brazil's U.S.-bound ethanol exports will be routed through the Caribbean for processing to exempt it from a U.S. import tariff, a Brazilian agricultural analyst said on Friday.

The United States has ended a loophole that enabled oil companies to import some ethanol tariff-free with credits they earned by fueling aircraft headed abroad, closing a window through which Brazil was able to export its biofuel fuel more competitively.

The only other means to avoid the 54-cent-per-gallon tariff on ethanol is to process it in the Caribbean from where it can be imported tariff-free because of a trade accord that began in the last years of the Cold War to win favor in the region.

"A greater share of the Caribbean (processing) capacity will be utilized this season," said Plinio Nastari, chairman of Datagro, meeting with reporters and an analyst in Brazil's business capital, Sao Paulo, on Friday.

"The quota for U.S. ethanol imports through the CBI (Caribbean Basin Initiative) was set at 2.353 billion liters for 2009," He added that this represented a 30 percent increase over the 1.732 billion liter quota last year.

Some Brazilian ethanol shipments bound for the United States stop in the Caribbean for conversion into anhydrous ethanol from hydrate.

Despite the recent uptick in local ethanol prices, more and more mills are harvesting now, and the flow of ethanol from the center-south cane fields should force domestic prices down and divert the biofuel to international markets.

However, analysts, including Nastari, think Brazilian ethanol exports may fall overall.

LOCAL DEMAND RISING

Brazil is seen exporting a total of 4 billion liters of ethanol in 2009/10, down from the 4.8 billion liters in 2008/09, Datagro forecast and the U.S. auto fleet is the main consumer of Brazilian ethanol exports.

Some have forecast an even greater drop in exports due to a 10 billion reais ($4.6 billion) credit the government pledged earlier this week for stocking ethanol through the harvest.

"We will have to see how much of the government's pledge for mills to stock the fuel gets into borrowers hands," said Nastari, who added he was sceptical all the funds would be used.

Nastari said the growth in Brazil's cane output to 601 million tonnes in 2009/10 from 565 million tonnes last season, however, would not keep pace with the expansion in demand from Brazil's flex-fuel cars, which can run on ethanol alone.

A greater share of Brazil's cane crop will go to sugar production this season than last due to the weakening of the local currency, the real <BRBY>, against the dollar, which has boosted sugar export prices for producers, Nastari said.

This year, 57.2 percent of the center-south cane crop will be used to produce ethanol, down from 60.4 percent last year while the rest will be used to produce sugar. A smaller cane harvest in India has helped boost world sugar prices.


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## hkskyline

*ANALYSIS-California rule could end ethanol's honeymoon *

NEW YORK, April 24 (Reuters) - California's newly adopted low-carbon fuel standard may mark the beginning of the end of ethanol's coveted status as the sole U.S. alternative motor fuel.

The U.S. state with the most cars late on Thursday approved the world's first-ever regulations to slash emissions of planet-warming carbon dioxide from vehicle fuels.

The ruling, which will be subject to further studies, will not kill the ethanol industry. But it sets the bar higher for cleaner development of corn ethanol, which enjoyed an investment boost over the last few years thanks to generous federal incentives and mandates calling for increasing amounts of the fuel to be blended into gasoline.

The measure also sets the stage for emerging alternative fuels -- such as cars that run on compressed natural gas and electric vehicles like plug-in hybrids that run on both gasoline and rechargeable batteries -- to compete with second-generation ethanol.

That fuel, known as cellulosic ethanol, is expected to be made in commercial amounts from non-food feedstocks like switchgrass and fast-growing trees.

"The ruling is the first sign that the ethanol industry could be brought out of its honeymoon phase," said Sander Cohan, an alternative motor fuels analyst with Energy Security Analysis Inc in Boston.

"First-generation ethanol, especially corn ethanol, is a poster child for who might be put at a disadvantage."

To give fuel producers time to adjust, the bulk of the carbon limits required under the regulation do not go into effect until 2015.

But analysts said California has fired the first shot in a battle that could widen in coming years. At least 11 other states in the U.S. East are considering adopting a low-carbon fuel standard for cars by the end of the year. In addition, the main climate bill being considered in the U.S. Congress seeks to regulate greenhouse gas emissions from fuels.

California's regulators ranked 11 different ways of making corn ethanol. They found that traditional distilling methods used in the Midwest, accounting for the bulk of U.S. supplies, emit the most carbon over a lifecycle measured from production to combustion.

The state gave much better carbon savings scores to corn ethanol made in California with a distillery fired by a blend of natural gas and crop waste, also known as biomass.

In the race to make ethanol, little regard has been paid to emissions of the distillery itself. A handful of nearly 200 plants are fired by coal, the most carbon-heavy fossil fuel, while many others have been slow to convert to biomass.

Cellulosic ethanol faired better.

"The standard is favorable to cellulosic and to plug-in hybrid development, but not favorable to U.S.-produced corn ethanol," said Divya Reddy, an analyst with the Eurasia Group in Washington.

Cars fueled by compressed natural gas, which are not yet widely available, scored slightly better than California-made ethanol, and vehicles that run on batteries, which also are just beginning to be made in the United States, scored much better.

LAND USE

The ethanol idustry challenged California's findings, and said it would fight the regulations.

The ethanol industry's biggest objection is that the standard calculates an indirect carbon footprint attributed to land-use changes from the clearing of grasslands and forests to cultivate corn.

Nathan Shock, a spokesman for private company Poet, the largest U.S. ethanol producer, said those land-use calculations are unfair because the rule as currently written applies to biofuels alone, putting ethanol at a relative disadvantage.

Bob Dineen, head of ethanol industry group the Renewable Fuels Association, said the ruling could hurt investments in the development of next-generation ethanol.

Paul Winters, a spokesman for the Biotechnology Industry Association, said the ruling could hit investments by the biggest producers of corn ethanol into cellulosic. Some traditional ethanol makers have plans to make cellulose-based fuel using readily available crop waste like corn cobs and stalks.

But as the ethanol industry argues its case, natural gas and battery-powered cars will likely make inroads in replacing petroleum, Cohan said.

"The strength of the low-carbon standard ... is that it forces attention toward non-agricultural alternative fuels that will likely play a role in any sort of alternative fuel mix," he said.


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## hkskyline

*U.S. corn girding up Calif low-carbon fuel standard *

CHICAGO, April 23 (Reuters) - The corn market is girding for California regulators to adopt carbon emission rules for motor fuels that may trim the use of corn-based ethanol.

California regulators are poised to adopt landmark rules curbing carbon emissions for motor fuels, which contribute to global warming, as early as Thursday or Friday.

"The corn trade is understandably nervous and watchful," said Rich Feltes, senior vice president at MF Global Research.

"We all know the extent to which ethanol has been a factor in the last three years in pumping up risk premium in corn. Anything that would unwind that, destabilize that, is going to be viewed as negative."

The proposed low-carbon fuel standard, the first of its kind in the United States, is designed to reduce greenhouse gas emissions from motor fuels by 10 percent, or 16 million metric tons, by 2020. It also outlines a complex method for determining the "carbon intensity" of all transportation fuels.

Current U.S. law mandates 10.5 billion gallons of ethanol be consumed in 2009 and 12 billion in 2010, up from 9 billion in 2008, as the government works to wean Americans from foreign oil. This season, one-third of the 12.1 billion bushel U.S. corn crop will be used to produce ethanol.

"They certainly created some uncertainty -- it's a concern but not something that spells the beginning of the end of ethanol," said analyst Marty Foreman with grain consultancy Doane Advisory Services.

Any regulation that might affect demand for corn-based ethanol will not be taken lightly by the market, analysts say. Corn soared to an all-time spot high of $7.65 in the summer of 2008 due in part to strong demand for corn to meet the needs of the then-booming biofuel industry.

Since then, ethanol makers have fallen upon hard times, squeezed by high prices for corn and a steep decline in gasoline prices as the global recession took hold.

Corn prices, in turn, have fallen 50 percent since then, with the spot price for Chicago Board of Trade corn closing at $3.81 a bushel on Thursday. But that is still well above historical levels in the $2 to $2.50 range.

Analysts were still determining how the California low-carbon fuel standard would impact ethanol use from 2011 when the standard would be implemented.

Ethanol advocates say the measure used to determine "carbon intensity" unfairly penalizes grain-based biofuels.

Similar rules are under consideration in 11 other states that are waiting for California to act.

Additionally, the National Corn Growers Association, representing 35,000 U.S. corn farmers, in a recent statement said the proposed fuel standard did not take into account rising corn yields since 2001.

"Just as the corn market was pumped up by ethanol it can certainly lose some of its risk premium if we slowly see them unwinding corn ethanol as a favored form of green energy," Feltes said.


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## Papacu

*Sugarcane Bagasse: A Profitable Residue*

Brazil continues to develop its “natural knowledge economy” by investing in opportunities for innovation based on the country’s natural resources. Sugarcane bagasse, once a worthless residue is now an important co-product used for the generation of energy and production of ethanol, among other things.
The use of the bagasse for energy begins in the sugar cane processing plants, which have become self-sufficient by using the residue. Last year, over 140 million tons of the residue were used for power generation, as opposed to packing the plants’ courtyards waiting to be disposed of. Bagasse is also being used for the production of pellets, which are then used as fuel for thermal plants. Pellets are easier to transport, have a higher heating potential and a higher market price than the unprocessed bagasse and have a lower carbon emission rate than coal, the most commonly used fuel in thermal plants.


It is estimated that if the usage of sugar cane bagasse for generating energy continues to grow, by 2021 it could reach an astonishing 28.760 megawatts/hour, enough to power 8800 houses for one year. The bagasse is also being used in the production of second-generation ethanol. The fuel is being developed in Brazil by the Centro de Tecnologia Canavieira (CTC) (Sugarcane Technology Center), a technology research center focused on sugar cane, and Dedini S/A, a company whose operations range from breweries and fertilizers to mining and ethanol. The development of the second-generation ethanol is still in its initial stages.


*Sugarcane bagasse could benefit Brazil energy matrix*

By Anna Austin, from Biomass Magazine

According to an analysis recently completed by researchers at Frost & Sullivan, Brazil may benefit from the use of sugarcane bagasse for power generation, reducing its dependence on hydropower.

Titled “Sugarcane Bagasse for Power Generation in Brazilian Markets,” the study said biomass currently represents approximately 4.1 percent of the total installed energy capacity in Brazil, the majority of which is derived from sugarcane bagasse.

Julio Campos, industry analyst at Frost & Sullivan, said Brazil currently generates approximately 83 percent of its electricity through hydroelectric dams. “It will greatly depend on its water level, so during drought periods, the country may find serious problems to supply energy to the matrix,” he said. “The creation of new installed capacity to generate energy from sugarcane bagasse will drive a very positive diversification of the Brazilian electric energy matrix.”

The analysis said the sugarcane bagasse power market reached 3 gigawatts in 2007, estimating that number would increase to 12.2 gigawatts in 2014. To further support the expansion of sugarcane bagasse cogeneration technologies, Frost & Sullivan researchers recommended structured tax and financial policies, including the establishment of fair prices to pay back the high investment required of the mills.

According to UNICA, the Brazilian Sugarcane Industry Association, there are approximately 25 million hectares (61.8 million acres) of suitable degraded pastures available in Brazil for sugarcane expansion. Between 2007 and 2008, the annual gross earnings from sugarcane in Brazil amounted to approximately $20 billion, 2 percent of which came from biobased electricity.

UNICA estimated that sugarcane production will increase from approximately 496 million tons in 2007-’08 to more than 1 billion tons in 2020, and that the 3 percent of sugarcane currently used to produce electricity will rise to 15 percent. This is assuming 1 ton of sugarcane produces 250 kilograms (551 pounds) of bagasse, which generates 85.6 kilowatt-hours of electricity. Any excess biobased electricity produced in Brazil could supply countries such as Argentina and Sweden, the association said.


*Frost: Brazil Turns to Sugarcane Bagasse Power Generation to Reduce Hydropower Dependence*

September 30, 2008 // Published as a news service by IHS


Brazil is increasingly turning to alternative power generation fuels, such as biomass, in order to increase electricity supply and reduce its dependence on hydropower.

According to Frost & Sullivan, biomass power represents approximately 4.1% of the total installed capacity in Brazil and most biomass cogeneration is based on sugarcane bagasse.

At present, sugarcane bagasse cogeneration accounts for 3.03% of the total Brazilian energy matrix.

Recent analysis from Frost & Sullivan of Brazil's sugarcane bagasse for power generation found that the market reached 3.0 gigawatts (GW) in 2007, with estimates to reach 12.2 GW in 2014.

The Brazilian sugar and alcohol sector envisages to market electricity surplus to the national grid, analysts said. In order to produce marketable amounts of electricity, the sector is expected to invest in new technologies, including cogeneration equipment.

There is a clear trend toward the implementation of boilers with higher steam-production capacity. New boilers and steam turbines with higher capacity and efficiency would substantially increase the electricity surplus the plants could sell.

"The National Bank for Economic and Social Development (BNDES) has created several credit lines to finance power plants that require new equipment and upgrade in order to produce excess energy that can be sold to the national grid," said Julio Campos, an industry analyst at Frost & Sullivan.

"At present, there are 47 projects under BNDES and these have the potential to contribute 1.4 GW of cogenerated electricity to the national grid in 2008 and 2009."

However, unattractive prices are discouraging companies looking to sell their excess electricity to the national grid.

Analysts said Brazilian sugar and alcohol plants produce around 95% of their electricity needs, purchasing the remaining 5% from national-grade transmission and distribution (GT&D) companies. Plants claim that the prices they pay to those companies for this additional power are several times higher than the prices paid by GT&Ds for the plants' electricity surplus.

"Another significant restraint for the cogeneration market is the lack of connection to the electric grid," said Campos. "In addressing this, many sugarcane cogeneration-related associations, such as Associação Paulista de Cogeração de Energia (COGEN-SP- Paulista Association of Cogeneration) and Agência Nacional de Energia Elétrica (ANEEL) are working on building generation distributive center units that will collectively transmit electricity cogenerated in the mills and input it into the grid."

Structured tax and financial policies would serve as a driver for the expansion of sugarcane bagasse cogeneration technologies. Government and related regulatory agencies should develop clear planning and regulatory structures in order to boost cogeneration capacities in sugar mills. Analysts said this includes the easy and efficient connection to the grid, and the establishment of fair prices to pay back the high investments of the mills.

Source: Frost & Sullivan.


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## Papacu

*BRAZIL: Bittersweet Sugarcane*

By Mario Osava

MAURILANDIA, Brazil, Sep 3 (IPS) - The sugarcane workers in this small Brazilian town ate at least 200 of the little roasted wild birds. But they had not hunted them. They merely collected the roasted bodies of the birds that died in the controlled fire set in the cane field.

"For me it’s the saddest thing. There are no more wild birds or animals in Maurilandia. Because there are no more forests, the few that are left take refuge in the sugarcane and die when the fields are set on fire to prepare the cane for the harvest," says Corí Alves Ferreira, recalling the macabre feast.

Sugarcane fields surround this town of 10,000 in the central Brazilian state of Goiás, which has suffered the economic, environmental and social impact of the Vale do Verdao factory, which produces sugar and cane alcohol less than one kilometre outside of town.

The Verdao river, which lies between the factory and the town, has also felt the effects of the sugarcane fields that run right up to its banks.

The smell of burnt sugarcane cane and of vinasse, a by-product of the alcohol distillation process, is stronger at certain times of the day.

The red dirt roads are now blackened, and the smoke covers the town when the fields on set on fire, a process used to clear debris and excess leaves when the harvest is done by hand.

At the age of 70, Alves Ferreira has many memories of the town he helped found when he was just a teenager, along with his brothers and many other adventurers who flocked in from all over the country to pan for diamonds in the Verdao river.

His father, who purchased land in what is today the municipality of Maurilandia, died when Corí was only nine. But he and his five brothers found wealth in the diamonds.

Around 3,000 people showed up to pan for diamonds, building a precarious settlement where fights and even killings became routine.

But the diamonds ran out and "everyone, even the monkeys," fell ill with malaria.

People fled the area en masse, until only around 300 of the original settlers remained. Alves Ferreira, who for some reason never came down with malaria, ended up building the roads that are now the wide main streets of Maurilandia.

He was also the first to have a motor vehicle - a jeep in which he would drive the sick to the nearest town, taking a long detour to cross the river.

The settlement became a municipality in 1963, when it had grown to 2,000 people. Alves Ferreira was the first mayor, elected at the age of 26, for the 1965-1969 period.

"I cried," he confesses, because he had to leave his farm to which he had dedicated so much time and effort, and where there was so much left to be done.

He bought a house to serve as town hall, and after a terrible outbreak of malaria, he built a ferry to take people across the 50-metre-wide river and end the town’s isolation.

Thanks to the young mayor’s efforts, Maurilandia became one of the first towns in the region to have electricity. He also put in place a system to supply the town with drinking water.

Since re-election to a second consecutive term was not possible, he served as town councillor until he was elected again as mayor for the 1973-1977 period, when his administration built schools and health services.

He was poor by the time he left office. He did not draw a salary as mayor, and used money from his own pockets to cover the cost of works like bringing in electric power. He even had to sell his farm.

But he still had some real estate in the town, which gives him a modest living, from rental payments. A father of six, Alves Ferreira remarried after his wife died.

He says he does not like politics and has no interest in being rich, but would only like to have enough money to fulfil his dream of travelling around the country.

He also wants to revive his career as a singer, which was cut short, after the only album he recorded in 1984, by the death of his partner, who sang duets with him in the "sertaneja" country music genre. Some of the songs that he and his partner wrote are still heard on the radio in rural areas, says Alves Ferreira with pride.

He is annoyed because his successor in town hall refused to donate land for the Vale do Verdao factory. As a result, the company built its plant on the other side of the river, in the municipality of Turvelandia. "Maurilandia was stuck with the pollution and without the tax revenue," he complains.

His biggest concern is the environment, he says, because the planting of sugarcane has destroyed the forests, all the way up to the riverbanks, and the city’s water supply is now polluted.

Not to mention that there are no more birds.

The people living closest to the factory also complain about the stench from the feedlots where the company raises cattle on sugarcane bagasse.

The pollution causes respiratory and skin ailments in the town. Marluce da Silva, a nurse at the local hospital, suspects that toxic agrochemicals have increased the rates of cancer of the lungs, intestines and liver.

Her colleague Vania de Souza, who works at the local Familia health post, complains about the extra burden created by the seasonal sugarcane cutters in a municipality that is chronically strapped for funds.

Thousands of people flock to the area during harvest-time, which usually runs from May to December.

In addition, many people come to Maurilandia from neighbouring municipalities for the higher quality and more affordable health care.

One such case is that of Daniel Correia, who hurt his thumb in an accident while working in a sugar mill in Porteirao, but was treated here because he is staying in the city.

Correia, a 25-year-old married father of two, comes from Maranhao, a state in Brazil’s impoverished northeast - the region that supplies Goias with most of its cane cutters.

The workers pay around 100 dollars for a three-day bus ride to this area, where they earn about 400 dollars a month.

The work is tough, and the cutters are out in the fields for at least 10 hours a day.

"It isn't much. But in the factory back home you earn a great deal less: 100 dollars a month at the most," says Francisco Lopes da Silva, whose wife and two kids are back in Maranhao, like Correia’s.

In addition, the locals complain that the thousands of temporary workers who overburden Maurilandia’s public health services have also led to a growth in prostitution and have driven up teen pregnancy rates.

The Familia health post is currently providing care to 110 pregnant women, most of whom are not year-round residents, according to de Souza.

Many girls in the area become mothers at the age of 14 or 15, says the nurse, although she admits that it is a nationwide problem.

De Souza, who has been in Maurilandia since May, sees the sugarcane industry as beneficial. "The factory generates employment," she says. "There is no lack of jobs for whoever wants to work, and there are no beggars or homeless people on the streets."

But Silvana Flores, a teacher who also owns a local butcher shop, says the dependence on sugarcane is bad for the local economy, which she describes as on the verge of bankruptcy.

The factories provide their workers with three meals a day, which deprives local shops of customers.

In addition, the sugar mills have built housing for the workers on their own land, and other housing is being built in municipalities in southern Goias, drawing people and business away from Maurilandia, complains Flores, who inherited the butcher shop from her husband when he was killed during a bank robbery in 2005.

The six or eight thieves "were surrounded by the police, who showed up shooting," she says. Her husband, whose leg was shot in the crossfire, was killed by the thieves when they tried to take him with them as a hostage. "The city came to a standstill for three days," she recalls.

Lisángela dos Santos, who has a shop in a poor neighbourhood in Maurilandia, concurs with Flores, saying the sugarcane industry has not been positive for the local economy.

She also points to the problem of "harvest husbands" who leave their pregnant girlfriends behind when they go back to their faraway homes.

Many local teenagers try to hook up with cane cutters with the hope of finding a stable relationship or a steady source of income, like child support, says dos Santos. "The sugarcane industry does not generate employment for women," she points out.

A 16-year-old girl who asks not to be identified by name is a case in point. The father of her nine-month-old son drives a truck for a nearby factory. Their relationship lasted two years.

She stayed in school, and says she has not suffered discrimination or taunts because of her pregnancy. Three other girls in her class are also mothers.

Nor did she have problems with her mother, a divorced domestic worker.

However, her mother does say she was surprised by how early sexual activity begins among today’s youngsters, pointing out that her daughter was only 12 when she had her first boyfriend, a cane cutter. (END/2007)


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## hkskyline

*Backers of 15 percent ethanol blend ask EPA for "green jobs" waiver *
6 May 2009

SIOUX FALLS, S.D. (AP) - A new study from an ethanol trade group says South Dakota could gain more than 2,500 new jobs and $400 million in economic activity if the federal government approves blending gasoline with 15 percent ethanol.

The national group, Growth Energy, submitted a "green jobs" waiver in March, asking the Environmental Protection Agency to allow gasoline blended with as much as 15 percent ethanol. It's now capped at 10 percent.

On Tuesday, Senate Republican Leader Dave Knudson of Sioux Falls, House Democratic Leader Bernie Hunhoff of Yankton, state Agriculture Secretary Bill Even and Growth Energy board member Jeff Broin of Sioux Falls said the EPA should approve higher ethanol blends.

"Ethanol has the power to not only end our reliance on foreign oil, but also to transform our economy and put people back to work," Broin said. "We're simply asking that the EPA removes the 90 percent monopoly that Big Oil currently has on our fuel supply."

"E15 is a triple-play," said Knudson. "It's good for the environment, good for the economy and good for national security."

Nationwide, the jump to E15 could create 136,000 new jobs and boost the economy by more than $24 billion, according to Growth Energy.

The EPA has until December to decide on the waiver. On April 21, the agency opened a 30-day "comment period" to gather public input.

"It is now critical for all ethanol supporters to take a few short minutes out of their day to contact EPA in support of this waiver, making sure their grassroots voice is heard," said Brian Jennings, executive vice president of the American Coalition for Ethanol.

Opponents called for cautious and careful study and urged the EPA to deny the waiver request.

"What they are asking for is that the EPA ignore provisions of the Clean Air Act," said Craig Cox, Midwest vice president for the Environmental Working Group.

"We're asking that the EPA do the tests, get the data and see if E15 pollutes the air or doesn't -- not based on the economic needs of the ethanol industry."

Growth Energy has created a Web site to allow people to comment.


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## honwai1983

Use of Ethanol is a waste of food. It increases the food price and many third countries cannot effort expensive food price.

I think reduce oil dependence should be reduce energy waste:

1. Use more energy efficient vechine (Hydrid vechine)
2. Improve thermal insulation in buildings.
2. Use more public transport instand of private car
3. Use railway for long distance transport instand of plane
4. Renewable resources (Solar Power)
5. City planning - Use higher density apartment instand of low density houses.
(It helps public transport growth)


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## I-275westcoastfl

They better not approve 15% it's a waste of money as cars will become less fuel efficient. Notice after they started adding E10 to gasoline that the EPA adjust the fuel economy estimates for all cars and they went down. I was lucky enough to use gas with no ethanol for a while and my car ran better and got better gas mileage, especially on the highway. The biggest scam in history right here.


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## hkskyline

*ADM hopeful on ethanol, may bid on bankrupt plants *

CHICAGO, May 13 (Reuters) - U.S. agricultural processor Archer Daniels Midland Co said on Wednesday it was "cautiously optimistic" about the struggling ethanol industry because U.S. law still mandates its use.

The ethanol industry had been worried that the U.S. Environmental Protection Agency would scale back requirements for ethanol use in a new draft Renewable Fuels Standard this month, but it left its annual blend targets intact.

"We do know that the RFS fuel standard will increase to 12 billion gallons in 2010," Steve Mills, chief financial officer at ADM, said at the BMO Capital Markets' Agriculture, Protein, and Fertilizer conference in New York.

He was referring to the mandated increase to 12 billion gallons of current generation biofuels for blending into gasoline in 2010 from 10.5 billion gallons in 2009.

The law requires 36 billion gallons of biofuels to be used in 2022, most of it next-generation biofuels made from non-food sources.

ADM did not comment on a potential increase in the amount of ethanol which can be safely blended into gasoline without harming car engines, which could bolster the struggling industry by boosting demand.

Ethanol supporters have petitioned the EPA for an ethanol blend rate increase to 15 percent, up from the current 10 percent.

The EPA said in April it would take a year to complete government testing on whether a higher blend rate would harm car engines. It is seeking public comment on the issue.

OPEN TO ACQUISITIONS

ADM said it was open to acquiring ethanol facilities from bankrupt biofuels makers, but added it would be selective.

"It really would have to be a great fit at a great price for us to consider it," Mills said.

The high cost of corn, which ethanol makers convert into the biofuel, coupled with a steep drop in fuel prices from last year's record highs have squeezed profitability of the ethanol sector and forced several producers into bankruptcy.

ADM, the No. 2 U.S. ethanol producer, bid on some assets of bankrupt ethanol producer VeraSun Energy Corp in a March auction, but did not acquire any facilities.

Another ethanol producer, Pacific Ethanol Inc , warned on Tuesday it would need to file for bankruptcy protection if it could not restructure its debt soon after its first-quarter sales fell by nearly half.


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## hkskyline

*Two more US energy firms succumb to price declines *

NEW YORK, May 18 (Reuters) - Tumbling energy prices over the past year and a lack of credit pushed two U.S. energy companies into Chapter 11 bankruptcy, the latest in a string of such filings.

Pacific Ethanol Inc , the largest West Coast-based producer and marketer of ethanol, put its production plants in California, Oregon and Idaho in Chapter 11 bankruptcy, the company said on Monday. The company's marketing arm, which buys and sells ethanol, did not file for bankruptcy.

Oil and gas exploration company TXCO Resources Inc said it also filed for Chapter 11 bankruptcy, along with seven subsidiaries.

Energy companies have suffered as the economic downturn sent prices for natural gas, crude oil and gasoline down sharply from their peaks in July, squeezing many of the smaller players.

Norwegian oilfield driller PetroMENA filed for bankruptcy on Sunday in the United States and exploration company Energy Partners Ltd of New Orleans filed for bankruptcy on May 1.

Pacific Ethanol, which reported 2008 revenue of $703.9 million, said it plans to continue marketing and selling ethanol under existing marketing agreements.

The five bankrupt subsidiaries have obtained bankruptcy financing of up to $20 million, which will allow them to continue operating while they reorganize, the company said.

The company said on May 12 it would likely need to file for bankruptcy if it was not able to restructure its debt.

Later on Monday, Pacific Ethanol reported a first-quarter loss of $23.9 million on revenue of $86.7 million, with the revenue down by nearly half from the year before.

Makers of the corn-based biofuel have struggled as weak U.S. demand for motor fuels has depressed prices and margins, and last year VeraSun Energy , once the largest publicly listed U.S. ethanol maker, filed for bankruptcy.

Pacific Ethanol, based in Sacramento, California, had said that the volume of ethanol sold fell 24 percent in the quarter, while the average sales price was down 28 percent. It said in court documents it had between $50 million and $100 million in assets and between $100 million and $500 million in liabilities.

TXCO Resources said in a court filing that it sharply increased capital expenditures last year just as prices for its oil and gas plummeted more than 50 percent, putting a severe strain on the company's cash.

The San Antonio-based company said in court documents it had $432 million in assets and $323 million in liabilities. It said it would seek court approval for $32 million in financing to get it through bankruptcy.

The company had 2008 operating revenue of $143.7 million and participated in 96 wells, mostly in Texas.

Shares of Pacific Ethanol and TXCO Resources were both down more than 40 percent in morning trade.

The cases are In re: Pacific Ethanol Holding Co LLC, U.S. Bankruptcy Court, Southern District of Texas, No. 09-11713 and In re: TXCO Resources Inc, U.S. Bankruptcy Court, Western District of Texas, No. 09-51807.


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## hkskyline

*Brazil hopes to team up with China in biofuel-media *

BEIJING, May 18 (Reuters) - Brazilian President Luiz Inacio Lula da Silva will focus on renewable fuels during his visit to Beijing this week, hoping to team up with China to develop bio-fuels, the Caijing Magazine has reported.

Lula arrived in Beijing on Monday and will pay a state visit for three days.

"We will focus on renewable fuels, especially ethanol and bio-diesel," Lula told Caijing in an interview on Friday when asked about his priorities for his state visit. The two developing countries already have strong trade ties.

"What we do want is for countries like China to establish partnerships with Brazil and Africa, for us to produce bio-fuels and generate more jobs and income," he was cited in a story posted on the magazine's website, www.caijing.com.cn.

Brazil has been promoting its ethanol technology to China, using sugarcane as feedstock. But given China's own shortage of sugar, China is not considering any sugarcane-based ethanol.

Brazil has also been proposing to export Brazilian-made fuel ethanol to China, but it now faces high import taxes as well as consumption taxes.

"If you don't have land to produce but you need energy, you can finance other countries that can produce to meet your market needs," Lula told Caijing.

Brazil is the only country in the world where nearly 90 percent of all cars sold are flex-fuel -- they can run on gasoline, 100 percent ethanol, or a blend.

Lula also said that it is possible that "another agreement between China Development Bank and Petrobras" will be signed during his visit, according to the English language Caijing story. It did not elaborate.

The China Development Bank signed a deal in February to extend a $10 billion credit line to Brazilian state-owned oil company Petrobras in exchange for 100,000 to 160,000 barrels per day of oil supplies to state firm China National Petroleum Corp and to Sinopec.


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## hkskyline

*U.S. House panel approves climate change bill *

WASHINGTON, May 21 (Reuters) - President Barack Obama's fight against global warming got a huge boost on Thursday when a key congressional panel embraced his plan to create a new, market-driven system for reducing greenhouse gas emissions.

The House of Representatives Energy and Commerce Committee, with a mostly partisan vote of 33-25, embraced Obama's "cap and trade" climate change initiative -- one of the president's top legislative priorities this year along with healthcare reform.

Representative Henry Waxman, the committee's chairman, said the bill advanced because it had "substantial support from industry, labor and environmental groups from across the country."

Among the major U.S. companies that have endorsed a cap and trade program are Alcoa , DuPont , Caterpillar Inc and a coalition of electric power companies.

With the panel's vote, the measure moved closer to a vote in the full House, which could occur by August after other committees review and possibly refine the legislation.

Democratic supporters say they want enactment of a bill this year but the outlook in the Senate was unclear.

The White House is hoping that at least significant progress will aid efforts culminating in December in Copenhagen for a new international pact on cutting industrial emissions linked to climate change problems.

"President Obama has made it clear that he wants to go to Copenhagen as the leader and not the laggard, which we have been over the last eight years," said Representative Edward Markey, a Democrat who wrote the bill with Waxman. He was taking a swipe at former President George W. Bush, who refused to sign onto the existing Kyoto Protocol on reducing carbon emissions, saying it would be too harmful to the U.S. economy.

In a statement after the vote on the legislation, Obama said: "We are now one step closer to delivering on the promise of a new clean energy economy that will make America less dependent on foreign oil, crack down on polluters, and create millions of new jobs all across America."

LIMITS ON CARBON EMISSIONS

The roughly 1,000-page bill aims to cut U.S. greenhouse gases that contribute to global warming by 17 percent below 2005 levels by the year 2020 and 83 percent by 2050.

The legislation also requires utilities to generate 15 percent of their electricity supplies by 2020 from renewable energy sources, such as wind and solar power.

The heart of the legislation is a "cap-and-trade" system that would gradually reduce the amount of greenhouse gases from utilities, oil refineries, steelmakers and other companies by requiring them to have permits to spew their emissions. 

Supporters of the bill want to use market forces to push companies to reduce their emissions. Companies that pollute above their limit would have to buy permits from less polluting companies, encouraging firms to quickly cut their emissions so they can make a profit from selling the permits that initially will mostly be issued by the government for free.

Republicans argue such a plan would further slow an ailing U.S. economy, raise energy prices for consumers and speed the exodus of manufacturers using large amounts of energy to lower-cost countries such as China and India.

Representative Joe Barton, the senior Republican on the House Energy and Commerce Committee, challenged the central notion that humans contribute to global warming and climate change and he noted the past several years of lower average temperatures.

Some environmentalists complained that the Waxman-Markey bill had become too soft on carbon reductions and alternative energy requirements. At the same time many of the groups applauded what could be the toughest bill politically doable.

Frances Beinecke, president of the Natural Resources Defense Council, said the bill would create "millions of good-paying American jobs" and was "an historic step to unleash clean energy and rein in global warming pollution."

House Republican leader John Boehner has predicted an opposite outcome and said this "national energy tax would have a particularly devastating impact on rural communities across the nation" where fuels make up a large part of agricultural and commuting costs.

During four days of committee debate, Republicans on the committee failed to win new breaks for the nuclear power industry and to kill the cap and trade program.

But they won new breaks for the agriculture, ethanol and oil industry by including government-backed loans to help finance the building of pipelines that carry renewable energy such as ethanol.


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## hkskyline

*EPA seeks more comment on ethanol blend rate*

WASHINGTON, May 15 (Reuters) - The U.S. Environmental Protection Agency said on Friday it was extending for 60 days, until July 20, the public comment period on a proposal to increase the amount of ethanol that could be blended into gasoline to as much as 15 percent per gallon of motor fuel.

Ethanol is now approved to make up 10 percent of gasoline in cars and trucks. Producers are pushing the government to allow higher ethanol blend levels, as more ethanol will be required each year under federal law.

Congress required 9 billion gallons of ethanol and other biofuels to be blended into gasoline last year. The amount will rise annually toward 36 billion gallons a year in 2022.

Growth Energy and 54 ethanol manufacturers petitioned the EPA on March 6 to allow gasoline to contain up to 15 percent of ethanol by volume.

The EPA said it has up to 270 days, to Dec. 1, to act on the request. The agency said the comment period extension will not change the Dec. 1 deadline.


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## hkskyline

*Brazil biofuel conference attracts big speaker line-up *
29 May 2009
Agence France Presse

An international conference on biofuels addressing the challenges faced and posed by the sector is to attract a top-level line-up of speakers in Brazil next week.

Former US president Bill Clinton will lead the keynotes at the three-day Ethanol Summit to be held in Sao Paulo from Monday.

Others speaking include senior representatives for British energy giant BP and Japan's Honda, the European Union and United States, Brazilian ministers, Brazilian and US ethanol producers, as well as academics and consultants.

Issues to be discussed at the event cover: protecting the environment while growing biofuel crops, future possibilities for biofuel and oil companies' increased interest in the alternative energy source.

Advances in auto technology adapting to biofuel and challenges facing the sector are also to be raised.

Clinton, who championed a fight against climate change and promoted sustainable development during his 1993-2001 presidency, is to give his conference presentation Monday, followed by another speech at a Sao Paulo university.

The biofuels conference is organized by the Brazilian sugarcane growers' association UNICA. Around 130 delegates from various countries are taking part.

Brazil is the world's exporter of ethanol, and the second-biggest producer, after the United States. It has been lobbying hard for greater access to the US and EU markets.


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## insertnickhere

no it cant and no it wont. its just the corn industry wanting big money. as if bread and feed isnt going up anyway


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## hkskyline

*ND officials want more ethanol in gasoline *
1 June 2009

BISMARCK, N.D. (AP) - A former U.S. Energy Department official says a higher ethanol blend in gasoline will help the industry and cut dependence on imported oil.

Andy Karsner spoke Monday at a renewable energy conference at Bismarck State College. Gov. John Hoeven and U.S. Sen. Byron Dorgan organized the meeting.

An ethanol group has asked the federal Environmental Protection Agency to allow a limit of 15 percent ethanol in blended gasoline. The limit is now 10 percent.

The ethanol industry is having money problems. Hoeven and Dorgan say the higher standard will help spur new demand for the fuel.

Karsner says studies have shown vehicles and small gas-powered engines will run well with a higher ethanol mix.


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## hkskyline

*Ethanol producers in Denver to hear financial survival tips, new technologies*
15 June 2009

DENVER (AP) - Some 1,700 members of the ethanol industry are in Denver to learn financial tips and ideas for new technologies.

The industry has fallen into trouble because of the recession, tight credit markets and volatile gasoline and corn prices. Many companies have sought bankruptcy protection, idled plants and sold off assets to cut costs.

Producers are attending the International Fuel Ethanol Workshop to hear experts detail new technologies and financial tips. It begins Monday and runs through Thursday.

Analysts say the industry will emerge from the turmoil with fewer but healthier companies and new types of investors such as oil companies.


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## hkskyline

*French ethanol sector confident on E10 rollout *

PARIS, June 22 (Reuters) - The rollout in France of petrol with 10 percent ethanol should accelerate to cover most service stations by year-end, compared to only 8 percent of outlets currently, ethanol makers and distributors said on Monday.

The SP95-E10 fuel, launched on April 1, was on sale at just over 1,000 stations by mid-June, and Alain Jeanroy, managing director of France's sugar beet growers group, was confident it will hit a sector target of 70 percent of stations by end-2009.

Driving the rollout of the E10 fuel is the fact it is needed to meet national targets for biofuel incorporation, which if not met involve fiscal penalties for fuel distributors, he told a news conference.

France has set a target of 6.25 percent biofuel blending by the end of this year -- equivalent in volume terms to 9.5 percent ethanol content.

Sugar beet is the main raw material for ethanol in France.

Thierry Forien, deputy director of the fuel distribution arm of supermarket group Leclerc, France's No. 2 petrol retailer behind oil major Total , said the E10 rollout would gather pace after initial bottlenecks created by the need to invest first in adapting the network.

"It was a quite a change to the petrol supply chain in France," he said, adding that between 1 and 3 million euros had to be invested in each depot to adapt to the new fuel.

In sales terms, the E10 fuel accounted for about 7 percent of petrol volumes in France in April-May, with more than 100 million litres sold, he said.

E10 is compatible with about 60 percent of petrol-fuelled cars in France, which in turn make up less than half of the total fleet because of the expansion of diesel fuel.

To convince customers to switch to E10 from a previous SP95 fuel with up to 5 percent ethanol, distributors said they had lowered their prices and invested in signage at the pumps.


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## hkskyline

*Deal sends bill to slow global warming to House floor for first time; vote could come Friday *
23 June 2009

WASHINGTON (AP) - Key Democrats reached a deal Tuesday that its supporters hope will lead to House passage of the biggest environmental bill in decades, one aimed at slowing the gradual, destructive heating of the planet.

Farm-state Democrats won concessions that will delay the Environmental Protection Agency from drafting regulations that could hamper the ethanol industry and will hand the Agriculture Department oversight of potentially lucrative projects to reduce greenhouse gases on farms.

The House is expected to take up the legislation on Friday, the first time the chamber will vote on a bill that would impose nationwide limits on the gases blamed for global warming emitted from power plants, factories and automobiles.

The breakthrough came hours after President Barack Obama at a news conference called on the House to pass the legislation, and a new EPA analysis showed that it would raise household energy costs on average only an extra $80 to $111 a year.

"It is legislation that will finally spark a clean energy transformation that will reduce our dependence on foreign oil and confront the carbon pollution that threatens our planet," Obama said. "And that is why I urge members of the House to come together and pass it."

The deal also concludes weeks of closed-door negotiations between the bill's sponsor, Rep. Henry Waxman, D-Calif., and farm-state Democrats, led by Rep. Collin Peterson, D-Minn., who expressed concern in recent weeks that there was not enough in the bill to alleviate the costs for farmers and said they would vote against it.

Peterson said Tuesday the agreement secured his vote. "We have reached an agreement that works for agriculture and contributes to the reduction of greenhouse gas emissions in the United States," he said.

The Obama administration and Congress are under pressure to pass climate and energy legislation prior to an international gathering slated for Copenhagen, Denmark, in December. The U.S. will sit down with other nations to hammer out a new international agreement to curb the emissions linked to global warming.

Peterson and Waxman, chairman of the House Energy and Commerce Committee, announced the agreement late Tuesday. The deal will bar the EPA for five years from including the conversion of forests to crop land when it calculates how ethanol production will contribute to global warming. During that time, the agency will have to conduct a study.

The agreement also includes a promise from Waxman that the Agriculture Department, not EPA, will oversee projects that will reduce greenhouse emissions on farms.

Waxman said after the meeting that he has the votes to pass the bill and the deal with Peterson shows support from three key groups -- environmentalists, farmers and much of the industry involved. Waxman had already struck deals with coal- and oil-state Democrats to ensure their support.

"That's a mighty effective combination," he said.

For weeks much of the behind-the-scenes discussions have focused on how much the bill would cost average consumers, who are likely to face rising prices for electricity and fuels as companies make investments to reduce global warming pollution. Republicans have called the bill a national energy tax that would cost households thousands of dollars a year.

Minority Leader John Boehner, in a memo to House Republicans sent earlier on Tuesday, called the pending floor vote "one of the defining debates of the 2010 cycle" and said that Democrats will vote for it at their political peril.

"Americans know that this bill would have a disastrous impact on our economy and our constituents," Boehner wrote. "The American people will remember this debate and will remember who stands up for them."

But two separate analyses by the nonpartisan Congressional Budget Office offered far lower estimates. The studies said low-income families would receive hundreds of dollars in credits or rebates each year through the sale of permits and the average cost per household would be $175. The EPA analysis released Tuesday said the average household cost would be even lower -- $80 to $111.

The House bill would require factories, refineries and power plants to reduce emissions of carbon dioxide, the leading compound linked to global warming, and six other greenhouse gases by roughly 80 percent by mid-century and hasten the nation's energy shift away from fossil fuels by putting a price on carbon dioxide releases.

The reductions would be made by capping emissions on key polluting sources. The polluters would then be provided emission permits with the cap declining each year. Some 85 percent of the permits would be given away, especially to energy intensive sectors of the economy. But others would be sold by the government, with some of the proceeds used to help people meet higher energy costs.

------

The bill is H.R. 2454.


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## hkskyline

*Nebraska groups spreading positive messages to counter negative on corn and ethanol production *
25 June 2009

LINCOLN, Neb. (AP) - Two Nebraska groups want people to know that corn farmers are doing a better job for them and the environment than ever.

The Nebraska Corn Board and Nebraska Corn Growers Association have begun a campaign to promote farmers' good works and products.

Jon Holzfaster is chairman of the Corn Board. He says farmers are growing five times more corn today they did in the 1930s but doing so on 20 percent less land.

Industry experts say corn farmers have cut their fertilizer use 36 percent in the past three decades and erosion 44 percent in the past 20 years.

The campaign was begun in part to counter criticism of the industry and the production of corn-based ethanol.

The campaign includes radio and print advertising. It runs through the rest of 2009.


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## hkskyline

*Dow Chemical, Fla. startup to build plant that would use algae to convert CO2 into ethanol *
29 June 2009

NEW YORK (AP) - Dow Chemical Co. and a Florida-based startup said Monday they're working on a project that will use algae to turn carbon dioxide into ethanol, a process that could make chemical manufacturing more environmentally friendly if successful.

As part of a test phase with Algenol Biofuels, Dow will build a 24-acre plant on the Texas coast that will be fed with carbon dioxide emissions from one of its nearby plants.

Algae, grown inside a clear chamber in a sea water solution, will use photosynthesis to break down carbon dioxide into oxygen and ethanol.

The ethanol can them be sold as a fuel, though Dow likely would be more interested in using it for plastics. Natural gas is currently a primary ingredient used to make plastics, and while the fossil fuel burns cleaner than crude, it's still considered a pollutant.

The oxygen could be used to burn coal cleaner, a process that would produce more carbon dioxide that could then be pumped back into the algae process.

The announcement comes days after the U.S. House of Representatives narrowly passed legislation to drastically limit America's carbon dioxide emissions.

"Everyone has been thinking of carbon dioxide as just a pollutant, and that's wrong," said Paul Woods, Algenol's CEO. "We have to start thinking about carbon dioxide as if it's a reusable, recyclable product."

The companies have jointly applied for a $25 million grant from the Department of Energy as part of the recent federal stimulus package.

Each company is funding different parts of the application process, though money isn't changing hands between the two.

"This project and the innovative technology involved offers great promise in the battle to help slow, stop and reverse the growth of greenhouse gas emissions," said Andrew Liveris, Dow's chairman and CEO.

The test plant, which is expected to employ about 300 people, will consume about two tons of carbon dioxide a day, enough to produce about 120 to 140 gallons of ethanol, Algenol said.

Algenol hopes the project will spark renewed interest in ethanol, which has gotten a bad rap lately from the other processes used to make it, namely corn-fed ethanol.

The Georgia Institute of Technology, the National Renewable Energy Laboratory and the Membrane Technology & Research Inc. are also working on the project.

Shares of Dow Chemical added 8 cents to $16.13 in afternoon trading. The stock has traded between $5.89 and $39.99 in the past 52 weeks.


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## hkskyline

*Farmers plant more corn than expected in 2009 *
AP
30 June 2009

ST. LOUIS – Farmers planted an unexpectedly large crop of corn and soybeans this year, easing some fears of rising food costs.

The U.S. Department of Agriculture said Tuesday a record 77.5 million acres of soybeans were planted through June, up 1.8 million acres from last year. Farmers also planted 87 million acres of corn, up 1 million acres from last year and the second-largest corn acreage in more than 60 years.

The unexpected boost in planting could mean crop supplies won't be as tight this year as many analysts feared a few months ago. Lower commodity prices would be welcomed by ethanol makers and meat companies that have been stung by higher feed prices over the last two years.

The USDA also reported a bigger supply of corn reserves on hand than many analysts expected. About 4.27 billion bushels or corn are stored on farms and grain bins, up 6 percent from last year and above the 4.18 billion bushes analysts had predicted, according to CME Group, with the Chicago Board of Trade.

The boost in supply is reinvigorating ethanol producers, who are slowly starting to ramp up production and look at reopening plants that were shut down last year when grain prices skyrocketed and oil prices crashed, said Brian Basting, commodity research analyst at Advance Trading Inc. in Bloomington, Ill.

"It appears to be a slow healing process" in the ethanol industry, Basting said. "We're seeing the (profit) margins creep back into positive territory."

The robust planting came as a surprise after rainy weather in the eastern Corn Belt caused farmers to delay planting because the ground was too soggy. But losses in those states appear to have been offset by perfect weather in western states like Nebraska, Iowa and Minnesota, said Greg Wagner, senior commodity analyst with Chicago-based AgResource Co.

"Those crops, at least today, are looking in great condition," Wagner said. But he warned late planting in several states could still make this year's crop susceptible to drought or heavy rains. "We know these crops are lagging in maturity, so we need to find out what the weather patterns are going to be."

Cotton planting, meanwhile, was at a 25-year low. Farmers planted about 9 million cotton acres this year, their fewest since 1983, with growers in Mississippi and Louisiana planting their smallest acreages on record. There was also a 46 percent decline in upland cotton acreage in California, where scarcity of irrigated water has been a persistent concern.


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## hkskyline

*President says series of meetings planned on ways to revitalize Rural America *
30 June 2009

YANKTON, S.D. (AP) - President Barack Obama says a series of meetings has been scheduled to find out from farmers, ranchers and rural communities how to revitalize rural America.

Obama outlined the effort Tuesday during an interview with WNAX radio in Yankton.

Top administration leaders, including Cabinet officials, will "fan out" and hold discussions on how to strengthen rural communities, Obama said.

He said the meetings will be held in Alaska, Louisiana, Nebraska, New Mexico, North Carolina, Ohio, Virginia, Wisconsin and Pennsylvania. Obama said Vice President Joe Biden will attend the first session Wednesday in Wattsburg, Pa., where the main topic will be rural broadband access.

Administration officials want to find out whether programs are working, he said, adding that there's no one-size-fits-all answer for rural America. The meetings are an opportunity to go out in the country and gather grassroots input, he said.

The president said his plan for rural America includes economic development, conservation and renewable energy. Biofuels will be a critical part of improving American agriculture's profitability, he said.

"I think there's huge potential around biofuels," Obama said.

Obama, a former U.S. senator from Illinois, said ethanol has been a boon to many rural communities' economies.

"What we also are recognizing is that the key for us is going to be to move into the next generation of biofuels" such as wood chips, switchgrass and refuse, he said.

Obama said climate change legislation that the House passed late last week will provide revenue opportunities for rural America while allowing it to achieve energy independence. He did not have a specific estimate on what the plan will cost farmers and ranchers.


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## hkskyline

*Big Iowa corn crop is good news for ethanol producers but sends corn prices into freefall*
1 July 2009

CEDAR RAPIDS, Iowa (AP) - Analysts expect this year's Iowa's corn crop to be the second-largest since 1946, despite rainy weather and fewer acres planted.

That's good news for ethanol producers, who are looking to reopen plants shut down last year when grain prices jumped.

The U.S. Department of Agriculture says Iowa farmers planted 13.7 million acres of corn through June, and expect to harvest 13.4 million acres.

The news sent corn prices plummeting on the Chicago Board of Trade. Corn for September delivery fell 30 cents -- the most prices can fall in a day.


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## hkskyline

*Big US corn area a reprieve for meat, ethanol cos. *

CHICAGO, June 30 (Reuters) - A shockingly large area planted with corn this spring in the United States should bring relief to loss-making hog and cattle producers, ailing ethanol companies and consumers as grain prices come under pressure.

For starters, prices for corn futures fell on Tuesday by the daily allowed trading limit that amounted to an 8 percent slump as government data showed farmers planted the second largest corn area since 1946.

It was a far cry from about a year ago when grain prices shot to record highs on a combination of floods threatening the U.S. crop and speculative-investment buying that hurt many meat companies, ethanol makers and consumers.

The largest U.S. chicken company, Pilgrim's Pride, went into bankruptcy due in part to the rise in grain prices in 2008, as did top ethanol maker VeraSun Energy Corp.

"I think they can quit worrying about $8 corn and I think they can quit worrying about $5 corn too," Doug Harper, analyst at Brock Associates, said of livestock and poultry producers.

"That will allow more livestock producers to stay in business," he said.

There have been growing expectations for U.S. livestock producers to cull their herds due to high grain prices and a drop in demand amid the sluggish global economy.

The U.S. Agriculture Department shocked traders on Tuesday by estimating 2009 U.S. corn plantings at just over 87 million acres -- sharply above an average of analysts' estimates for nearly 84 million and above its own forecast in March for about 85 million. 

"The acreage number is front and center. The corn number confirms that there was ideal planting weather west of the Mississippi and it's also a function of USDA underestimating the corn acreage in March," said Brian Basting, analyst for Advance Trading speaking on a Chicago Mercantile Exchange Group panel after release of the USDA report. 

Basting said that farmers in the western U.S. Midwest enjoyed exceptional corn planting weather while those in the eastern portion struggled to plant the corn crop because of a wet sowing season.

But it is now obvious that the farmers managed to sow the corn crop.

The plantings imply corn production of 12.3 billion bushels, based on yield projections the USDA made earlier this month. That would be the second largest U.S. corn crop on record, after 2007's 13.038 billion bushels. 

The bigger corn crop is good news for livestock and poultry producers, who rely on corn for feed, because Tuesday's data indicates there will be ample supplies of lower-cost feed.

The corn-based U.S. ethanol industry also saw an immediate improvement in their bottom line after battling high corn prices and wild swings in crude oil markets for over a year.

CBOT corn prices <Cc1> surged to a record high $7.65 per bushel a year ago then plunged 62 percent to a 2008 low of $2.90 per bushel by early December.

However, prices rallied 55 percent from late last year through the first half of 2009 to trade at $4.50 per bushel by early June at an eight-month high, again squeezing profit margins for the meat and ethanol producers.

Following the release of the USDA's acreage estimate on Tuesday, corn was trading below $3.50 per bushel.


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## hkskyline

*Environmentalists, industry interests debate energy development in South Dakota*
4 July 2009
Associated Press Newswires

MITCHELL, S.D. (AP) - As South Dakota continues an energy boom that began a decade ago, Don Carr watches from afar and says this state's residents may be getting in too deep too fast.

Since the ethanol boom began a decade ago, South Dakota has become home to 16 ethanol plants.

The state was once home to only a handful of individual wind turbines, but since the construction of the state's first large wind farm in 2003, four large wind farms have been constructed with at least another three under way or scheduled for construction. In the past 18 months, the amount of wind power in South Dakota has increased by 700 percent, producing approximately 285 megawatts of wind production capacity.

TransCanada, a Canadian oil company, is at present constructing its Keystone pipeline through the eastern portion of the state on its way to refineries in Oklahoma and Illinois.

Another TransCanada line, the Keystone XL, is proposed to be buried in central and western South Dakota.

The proposed Hyperion project may eventually see a huge oil refinery constructed in the extreme southeast corner of South Dakota, near Elk Point.

Energy proponents proudly note the quick development the state has seen, landowners are collecting payments from use of their property, and public entities such as school districts will get some of the collected tax revenue.

But some people have concerns about the state's rapid progress of energy development.

"Industry wants things to happen fast (and) a lot of times, environmental concerns and safeguards are an afterthought," said Carr, press secretary for agriculture and public lands for an organization called the Environmental Working Group. Carr also is a former communications director for the South Dakota Democratic National Committee. "We are constantly fighting the idea that environmental safeguards come second."

The debate about South Dakota's energy boom has caused something of a split. Both sides of the issue, and the political spectrum, wonder about the speed with which the state should embrace new energy industries.

Paul Blackburn, staff attorney for Plains Justice in Vermillion, a public interest law center that focuses on environmental issues, said he believes South Dakota's renewable energy advancements still lag behind neighboring states like Iowa and Minnesota.

"Relative to other states in the region, South Dakota has very little installed wind capacity," Blackburn said. "South Dakota is lagging way behind some other states in terms of its development."

Part of that relates to the national economy, he said, but the oft-discussed lack of transmission capacity also plays a role.

"I think that South Dakota should look into allowing more South Dakotans to sell their product via the wires that currently exist to customers in other states rather than having those wires be continually maintained for an exclusive use of fossil fuel interests," he said.

Sen. John Thune, R-S.D., also would like to see South Dakota progress faster.

"I would argue that we haven't moved fast enough," said Thune, who has long been a key figure behind energy development in the state. "There is so much pent-up opportunity in South Dakota for wind."

While alternative energy sources like wind may be embraced by many as the future of energy production, opinions on the pace and methods of such advancement differ throughout the state.

The importance of being farsighted

South Dakota Public Utilities Commissioner Dusty Johnson said the general consensus is that South Dakota should move faster to bring certain industries -- wind farms, for instance -- to the state.

The amount of channeled wind power in the state has increased 700 percent in the last 18 months, Johnson said, and work is continuing to lay groundwork for new wind farm projects.

As the process of constructing new wind farms in the state continues, Johnson said he hasn't fielded many complaints from residents concerned about the rate of progress.

"We haven't heard a lot from people who think we're moving too quickly," Johnson said. "By and large, we're hearing from people who would like to see the state move faster."

Johnson said the state was farsighted in preparing for companies interested in erecting wind farms in the area. Legally, wind rights can't be severed from property rights, nor do property owners legally sign an easement for more than 50 years.

Easement options also expire after five years, which prevents landowners from "signing up with the wrong developer and getting locked up for (numerous) years," Johnson said.

Members of the Legislature may soon hear from those who feel that such options actually give the landowner too much power over energy companies.

Johnson said developers have recently started to voice concerns about the five-year option expiration, and he expects to see the issue come up during the next legislative session.

"Some developers think that five-year window is too short because it takes so long to build this many massive, multimillion dollar facilities," Johnson said. "(There) will absolutely be legislation addressing that."

'Saudi Arabia of wind'

While Blackburn believes that South Dakota has a good amount of untapped renewable energy potential, he is concerned that residents aren't getting their due.

"There's been a long history in South Dakota of the wealth of the state being pulled outside the state by people or organizations that live outside South Dakota," Blackburn said. "It is quite possible for the wealth that's generated by wind and renewable energy development to end up outside the state."

Thune would like to see wind energy start to emulate the ethanol industry by having more local ownership.

The passage of a renewable energy standard by Congress and an improved economy could seriously boost the chances of such an increase.

"I'm very optimistic. Economics continue to improve as technology gets better," Thune said. "Those things are only creating forward momentum for wind energy in South Dakota."

Thune acknowledged that transmission issues continue to be the biggest hindrance to the growth of wind energy in South Dakota, but he's hopeful the future will hold the solution to the transmission capacity problem and make South Dakota "the Saudi Arabia of wind."

Blackburn believes that some transmission concerns could be solved using existing wires. He'd like to see independent studies conducted on the state's current transmission structure. It's also important to Blackburn that South Dakotans learn more about wind and other renewable energies and contact state regulators to ask for more efficient means of delivery.

"They need to ... encourage the regulators to promote these solutions," Blackburn said. "I think that sometimes the state regulators focus so much on rate that they don't think about the actual cost of power to the customers."

Ethanol debate

Since the boom of ethanol production began in South Dakota, 16 plants have been constructed, including Poet Biorefining near Loomis, which, according to Johnson, "is doing some of the best research in the world on cellulosic ethanol."

But Jim Margadant, regional conservation organizer for the South Dakota Chapter of the Sierra Club in Rapid City, is hoping South Dakota will place a stronger focus on cleaner energy sources, such as wind, instead of fuels that leave a larger carbon footprint.

Margadant expects water to become "more and more precious" as time goes on. Since biofuel manufacturers are large consumers of water, ethanol production may prove to be an increasingly inefficient source of energy, he said.

"Our state is kind of clinging to assisting and developing an energy policy that is pretty carbon dependent and it leaves a pretty dirty footprint," Margadant said. "That is not the way of the future."

Carr acknowledges that ethanol has been good for South Dakota's economy, but he's still waiting for proof that the federally subsidized industry is environmentally friendly. That, Thune said, is "bogus science."

"There is no question that ethanol is better environmentally than traditional fuels," Thune said. "You cannot tell me that something that comes from a product like corn isn't better than something that comes from petroleum for the environment."

As for the question of subsidies, Thune said the amount saved by not having to pay as many countercyclical and loan deficiency payments to farmers because of increased corn prices is much more than the tax incentives offered.

More wind farms can mean less reliance on other, more carbon-heavy, methods of energy production, Carr said.

Carr is concerned that increasing acres of fuel crops such as corn reduces the number of conservation acres, like those in the Conservation Reserve Program.

That, he said, also could have detrimental effects on the environment.

"The worry is ... that when land is taken out of CRP or these other conservation programs and plowed under and used to plant fuel crops, those lands are not replaced," Carr said. "When you plow them under, you release carbon in the atmosphere and you also take away land that cannot sequester carbon."

Thune, a longtime advocate of increasing CRP acres in South Dakota, said he's concerned about the decreased number of CRP acres but doesn't believe ethanol is a major factor. The increased price of corn simply makes it more logical for farmers to plant corn instead of enroll in the program, he said.

"I don't think you can say that because of ethanol, everybody's pulling their land out of CRP," Thune said.

------

Information from: The Daily Republic


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## hkskyline

*Test plant in small Wyoming town in race to create new, cleaner biofuel for autos*
4 July 2009

UPTON, Wyo. (AP) - In this tiny town on Wyoming's northern plains, workers feed large piles of aromatic pine chips into a labyrinth of pipes and tanks that process the wood into 200-proof liquid ethanol.

KL Energy Corp's test plant is among those at the forefront of a concerted research effort to turn trees, waste wood and other plants into automobile fuel.

The Rapid City, S.D.-based company hopes to capitalize on doubts about corn ethanol and the federal government's embrace of biofuels as a way to create jobs, help replace imported oil and protect the environment.

The market for corn grain ethanol is shifting to other ethanol sources, said Cole Gustafson, a biofuels economist at North Dakota State University in Fargo, N.D. Projects like KL Energy's are "clearly the future of the industry," he said.

"Across the country people are looking at many different opportunities and crops and feedstock supplies," Gustafson said.

The Obama administration recently announced that $49 million in federal stimulus money was being directed toward projects to turn wood into fuel. The government has also touted wood biofuel as a way to create markets for small wood and low value trees on federal forest lands.

Most ethanol now found at the gas pump is made from corn grain, but the industry is increasingly beset by environmental concerns over the amount of land and energy required to produce the corn.

"One thing the president has said is that we need to move to the next generation of ethanol, to fuels that are more sustainable," said Lisa Jackson, administrator of the U.S. Environmental Protection Agency, during a recent trip to Wyoming.

"We have corn-based ethanol now, and that was a good start and actually got a lot of industry and infrastructure going," she said. "But the next round needs to move toward cellulosic and other forms of biofuels that have feedstocks that show that they are energy efficient and that they take carbon into account."

In 2007, Congress required a huge increase in ethanol -- to as much as 36 billion gallons a year by 2022, including 16 billion gallons of cellulosic ethanol. Ethanol blended with gasoline burns cleaner in car engines than regular gasoline.

Ethanol can be produced from just about any plant. Most ethanol these days is produced from starch-based plants, such as corn, or from sugar-based plants, such as sugarcane. Cellulosic ethanol can be produced from trees, grasses and other plants that are easier to grow than corn.

A handful of companies are testing ways to produce cellulosic ethanol from wood. Gustafson said some use processes involving heat, like gasification or combustion, while others use chemical processes.

All are seeking to find the most efficient and economical way to make ethanol from cellulose that can be competitive with gasoline. But it remains uncertain when such fuels will reach gas stations in meaningful and affordable quantities.

"The economy and the technology isn't quite there yet," Gustafson said.

KL Energy's plant has been operating for a year, said Steve Corcoran, chief executive of the company. It makes small batches of cellulosic ethanol at a time, and has plans to expand to 24/7 production in the coming months. That would be a milestone in its goal of bringing its product to the commercial fuel market.

The company is testing a "thermal mechanical process" to produce ethanol from fallen and dead trees, brush and forest debris from the Black Hills National Forest in northeast Wyoming and southwest South Dakota. Much of the wood otherwise would be burned if it wasn't shipped to the Upton plant.

At full capacity, the pilot plant is capable of producing up to 1.5 million gallons a year.

The only non-useable waste produced by the plant is some discharged water that eventually will be cleaned for reuse in the process. Corcoran wouldn't release details of the company's technology, for proprietary reasons. But he said the process is environmentally clean because it doesn't use chemicals or acids.

Gustafston said there are relatively few potential investors in cellulosic ethanol because there's not as much certainty yet in production as with corn ethanol.

"And that creates a bit of a problem in that in the past everybody was focusing on corn ethanol ... and consequently we made gigantic leaps in technology development," Gustafson said. "Where here we don't have that concentrated effort. The efforts are much more spread out. So we're making smaller, incremental changes, but over a wider range of activities."

The business plan of KL Energy, which has been funded mostly through private investment, is to build plants based on its Upton model near forests around the country. The plants would produce up to 5 million gallons a year.

Corcoran acknowledged the plants' individual production would be small compared to the 100-milliom-gallon-per-year plants that large companies are looking to build.

But the plants would be cheaper to build and would save on transportation costs by taking wood from nearby forests and delivering ethanol to nearby communities, he said.

"It's multiple 5-million-gallon-a-year plants as opposed to just one big, 100-million-gallon-a-year plant," he said.


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## hkskyline

*Excessive ethanol complaints mount in Va *
8 July 2009

RICHMOND, Va. (AP) - The state's consumer watchdog agency has now received more than 500 complaints from motorists in the Hampton Roads area about high levels of ethanol in gasoline.

The Virginia Department of Agriculture and Consumer Services reported Wednesday that it has eight inspectors working on the investigation. The source has not been determined.

Ethanol is blended with gas at terminals before it's distributed. Too much ethanol may cause cars to backfire and stall, and prompt warning lights to come on.

The complaints started pouring into Consumer Services' Richmond office since June 8. They now total 532.

The agency said the pace of complaints has slowed.


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## hkskyline

*Environmental group says Missouri has potential for greater renewable energy production*
7 July 2009

JEFFERSON CITY, Mo. (AP) - A national environmental group says Missouri is a prime candidate for greater development of alternative energy projects.

A report Tuesday from the Natural Resources Defense Council says Missouri has about 2,500 square miles of land with wind speeds suitable for turbines that produce electricity. But Missouri currently has just three wind farms producing 163 megawatts of electricity.

The report also says Missouri has untapped potential to use cellulose materials from agriculture crops to produce ethanol, and to harness methane gas from large livestock farms for energy production.

Department of Natural Resources Director Mark Templeton says the report shows how rural Missourians could capitalize on a potential new national energy policy that limits carbon emissions.


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## hkskyline

*U.S. growing record soybean crop, No 2 corn - USDA *

WASHINGTON, July 10 (Reuters) - U.S. farmers will harvest their largest soybean crop and the second-largest corn crop ever, averting a potential supply squeeze while also leading to softer prices for the commodities, the government said on Friday.

The U.S. Agriculture Department said corn farmers face "sharply lower summer price prospects." Good weather and boosted plantings bode for a bumper crop.

Crop prices will return to "more normal" levels after last summer's problems in the world's top corn and soy producer helped drive prices to record highs, said Gerald Bange, chairman of the USDA's World Agriculture Outlook Board.

"The crop conditions are really not bad in most of the places where we're looking," Bange said on USDA's radio service.

The government boosted its corn crop forecast to 12.29 billion bushels, the second largest on record due to the second-largest plantings since 1946.

New-crop December corn futures <CZ9> at the Chicago Board of Trade dropped 3 percent to $3.30 per bushel on Friday, pressured after the USDA said stocks were larger than traders had expected.

"The old-crop ending stocks (for corn) ballooned up here," said Don Roose, analyst at U.S. Commodities. "In the end, the government took the very conservative road and left the yields unchanged on corn and soybeans."

Soybeans <SX9> were down 2 percent to $8.96 per bushel and wheat futures <WU9> also dropped.

Overall, USDA monthly crop data for corn, soybeans and wheat came in near expectations.

In its monthly update, USDA projected a soybean crop of 3.26 billion bushels, the largest on record. It would replenish a stockpile forecast to shrink to 110 million bushels, the smallest in three decades and less than a two-week supply.

"We were looking for a bearish report and we got it," said Jack Scoville, vice president at Price Futures Group. "The soybeans are probably a bit negative and the wheat production was at, or just above, trade expectations."

The wheat crop was estimated at 2.112 billion bushels, including 1.53 billion bushels of winter wheat, 81.2 million bushels of durum and 506 million bushels of other spring wheat.

U.S. crop prices soared to record levels since 2006 but will moderate in the 2009/10 marketing year, USDA said.

It projected an average farm-gate wheat price of $5.30 a bushel, corn $3.75 a bushel and soybeans $9.30 a bushel.

By comparison, the farm-gate price for 2008's crops are estimated at a record $6.78 for wheat, $4.05 for corn and $10 for soybeans.

USDA lowered its forecast of corn used to make ethanol for this marketing year by 100 million bushels, to 3.65 billion bushels, due to lower U.S. fuel use.


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## hkskyline

*US weekly ethanol margins up on softer corn prices *

NEW YORK, July 10 (Reuters) - Average U.S. ethanol margins have risen for the fourth week running as prices for corn, the top raw material cost for distillers, have fallen more than $1 a bushel over the month, experts said.

"The lower price of corn has really helped the economics of the ethanol industry," said Rick Kment, an ethanol expert at DTN in Nebraska.

The ethanol crush spread for average ethanol producers rose about 10 cents to 50 cents a gallon this week, using the formula of the Midwest ethanol price, minus the corn price divided by 2.8.

Operating costs such as natural gas and overhead trim the crush spread by about 20 to 30 cents per gallon, depending on the distillery, bringing net margins to between 20 and 30 cents a gallon this week.

The July corn contract <CN9> on the Chicago Board of Trade closed at $3.43-1/2 a bushel on Thursday, down more than $1 from prices in early June.

Prices could keep falling. The U.S. Department of Agriculture on Friday said farmers will harvest their second-largest corn crop ever, which will make for "sharply lower summer price prospects for corn." 

The recession continues to hit fuel demand, however, which could cut the amount of corn used to make ethanol for this marketing year by 100 million bushels, to 3.65 billion bushels, the USDA forecast.

Kment said poor fuel demand coming during peak summer driving season, is keeping distillers cautious about running their ethanol plants at full steam. "If we see a significant drop in demand, they could be in a little bit of same situation," as last autumn when margins began to drop.

Spot ethanol prices <ETHANOL/US> in the Midwest were down about 5 cents to $1.71 per gallon on weaker crude prices, which have fallen on bloated supplies of oil products, dealers said.

Still, the sunnier margins came as a relief to the industry, which has seen a slew of shutdowns, bankruptcy filings and curtailments as the hardest-hit distillers slow operations.

And U.S. production of ethanol is expected to be higher than last year as mandates for biofuel blending call for increases each year. The mandates call for 15 billion gallons per year of traditional ethanol to be blended into gasoline by 2015. up from 10.5 billion gallons this year.

Many ethanol producers make the livestock feed distillers grains as an byproduct, which can improve profits. Producers near feedlots can sell wet distillers grains, which are cheaper to make and can enhance profits. Ethanol plants farther from feedlots sell dried distillers grains, but have to buy natural gas to dry them, which adds to costs.


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## hkskyline

*Low gas prices hurt sales of high ethanol E85 fuel *
14 July 2009

MINNEAPOLIS (AP) - Lower gasoline prices, while a boon for drivers, were a gut punch for ethanol producers and promoters of the high-ethanol blend known as E85.

In Minnesota, the nation's leader in E85 pumps, sales fell off by more than half this spring compared with the year before, a disappointment to E85 producers and the farmers who supply them with corn to make the fuel. It's also a letdown for those who hoped the blend would provide a cleaner alternative to gasoline and accelerate the move away from fossil fuels.

When the price of gasoline falls, drivers of flex-fuel vehicles are less likely to choose E85 because the blended fuel's price advantage is reduced. Alternative fuel supporters, however, say they expect E85 sales to bounce back as gas prices rise again.

E85, which is 85 percent ethanol and 15 percent gasoline, can be used in the nearly 8 million flex-fuel vehicles on U.S. roads today. Corn and ethanol producers have promoted it heavily as a way to boost demand for ethanol beyond what's possible with the maximum 10 percent blend that's OK for any car.

The fuel is sold in all but a handful of states, but Minnesota has the most pumps, more than 350. It's followed by Illinois with about 200, and Wisconsin, Iowa and Indiana with about 120 each.

Three years ago, Minnesota Gov. Tim Pawlenty set a goal of 1,800 E85 pumps across the state by 2010. The state clearly isn't going to reach that goal -- it's only about 20 percent of the way there.

"It's important for any politician to set a lofty goal, something audacious," said Bob Moffitt, spokesman for the American Lung Association of the Upper Midwest. "That's the only way real progress is made. You have to be something of an optimist in the alternative fuels world, otherwise the hard realities will beat you down."


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## hkskyline

*Renewable Fuels Association spent $166,296 lobbying government in first quarter *
17 July 2009

WASHINGTON (AP) - The Renewable Fuels Association, an ethanol industry trade group, spent $166,296 in the first quarter to lobby on energy and fuel standards legislation, according to a recent disclosure report.

The industry has struggled amid the recession as gasoline and ethanol prices dropped and motorists' demand waned.

Some producers sought bankruptcy protection or closed plants, and about two dozen plants with the capacity to produce 2 billion gallons of ethanol have been idled.

Besides Congress, the group lobbied the departments of Energy and Agriculture, and the Environmental Protection Agency in the January-March period, according to the report filed April 20 at the House clerk's office.


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## hkskyline

*Companies building ethanol, fertilizer plants in Iowa offer corn farmers cash for cobs *
16 July 2009

DES MOINES, Iowa (AP) - Two new technologies offer the promise that corn growers could turn their cobs into cash.

Cobs, the refuse left behind after harvest, are now plowed back into fields. But companies from California and South Dakota plan to start changing that by building two plants in Iowa, one to turn the material into ethanol and another to produce fertilizer.

"We're excited about it," corn farmer Jim Boyer said, "that there's an opportunity for another profit stream off our farm."

Boyer already sells much of the corn from his farm in Ringsted in northern Iowa to a traditional ethanol plant in nearby Emmetsburg. Most ethanol in the U.S. is made from corn kernels.

But a $200 million plant being built by Sioux Falls, S.D.-based Poet Energy will make cellulosic ethanol, which comes from plant material such as cobs, wood chips and switchgrass. About two dozen cellulosic ethanol projects are being developed or built around the country, according to the Renewable Fuels Association.

The projects vary by region, with companies using whatever local crop is available. Louisiana and Florida companies, for instance, are using sugar cane, while one based in Oregon plans to convert poplar tress and wood chips into ethanol.

"There isn't an ethanol producer today that isn't looking at those kinds of biomass materials that can be converted into ethanol," said Matt Hartwig, a spokesman for the association.

In Iowa, it's corn, and a switch from regular to cellulosic could mean more kernels are available for human food and livestock feed.

The push for new ways to produce cellulosic ethanol comes as many ethanol makers are struggling to turn a profit. They've had to drop prices to remain competitive as gas prices have fallen, but the cost of corn used to make ethanol has remained relatively high, said David Swenson, a researcher at Iowa State University.

Some of the largest producers have declared bankruptcy or been sold.

Poet spokesman Nathan Schock said the company hasn't yet figured out how much it will pay farmers, but it could be $30 to $60 per ton for corn stover, which includes cobs and some stalk. An average acre in Iowa yields about 1.5 tons of corn stover.

The company's payments to farmers could be supplemented by the federal government through the Biomass Crop Assistance Program.

Poet's plant in Emmetsburg, about 120 miles northwest of Des Moines, is expected to produce about 25 million gallons of ethanol per year when it opens in 2011. It could generate as much as $10 million per year in extra income for farmers.

Meanwhile, San Francisco-based SynGest, Inc., plans to build an $80 million facility in Menlo, about 40 miles west of Des Moines, that will be the first to make ammonia fertilizer from corn cobs.

The plant, expected to be completed by fall 2011, will process 130,000 tons of cobs per year into 50,000 tons of fertilizer, or enough for 100,000 acres of corn, SynGest CEO Jack Oswald said. Farmers would get about $50 per ton of cobs.

The company plans to market ammonia fertilizer to nearby farms as alternative to nitrogen fertilizer, which is made from oil. More than half the nation's supply of nitrogen fertilizer is imported, which drives up the price to farmers, Oswald said.

"There's a lot of reasons why this is a smart and valuable thing to do," he said. "This is a huge industry opportunity."

Poet expects $100 million in federal and state aid to build its plant, while SynGest has applied for $40 million in federal aid and additional state help.

Farmers said they'd like to trade their trash for cash, but most lack equipment to easily scoop up cobs. Prototypes for such machines are being built, but they could cost more than the cobs bring in. Boyer said a lot of questions remain.

"If we have another stream of product coming off the field, is it going to take more equipment?" he asked. "Is it going to take more manpower? Are we going to have to store those cobs ourselves or are we going to be able to deliver them to the plant, or is the plant going to come pick them up?"

Clark Bredahl, who raises corn, soybeans and cattle 320 acres near Greenfield, also said he'd need to figure out whether selling his cobs made economic sense.

"If the company is willing to pay enough so that it becomes feasible for farmers to collect the cobs and deliver them to their plant, then that definitely has some promise," he said. "But we don't know what those details will be yet."


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## hkskyline

*Route of proposed $3.5 billion ethanol pipeline to extend into South Dakota *
17 July 2009

SIOUX FALLS, S.D. (AP) - The nation's largest biofuels producer and a Tulsa-Okla.-based pipeline company are expanding the route of a proposed $3.5 billion dedicated ethanol pipeline into South Dakota, the companies said Friday.

Poet LLC and Magellan Midstream Partners LP are studying the feasibility of the 1,800-mile pipeline, which is dependent upon studies addressing technical issues and Congress revising the U.S. Department of Energy's loan guarantee program, the companies say.

If built, the route would begin in Davison County, S.D. -- further west than O'Brien County, Iowa, as originally planned -- and deliver the alternative fuel from plants in Iowa, South Dakota, Minnesota, Illinois, Indiana and Ohio to distribution terminals in the northeastern United States.

"With South Dakota being in the top five of ethanol producing states and having almost a billion gallons of production capacity, that just made sense," said Poet spokesman Nathan Schock.

Magellan has been working with the Association of Oil Pipe Lines for years on how to transport ethanol through a pipeline, said spokesman Bruce Heine.

Heine said the biggest challenge is stress corrosion cracking, in which ethanol tends to cause internal cracking of carbon steel pipe more so than gasoline or diesel.

Magellan thinks the solution will be a combination of potential additives to help protect the pipe and the use of different welding techniques.

"We believe the combination of these factors would allow us to reliably, safely and cost effectively transport ethanol from the Midwest to the East Coast," Heine said.

Poet, based in Sioux Falls S.D., is the nation's largest ethanol producer with more than 1.5 billion gallons of annual production from 26 ethanol plants.

Magellan Midstream Partners LP transports, stores and distributes refined petroleum products.

Schock said Poet is taking the lead on market analysis for the project, while Magellan is addressing technical and issues. The two are working together on legislative challenges.

A positive assessment would allow one or both partners to enter into an agreement to construct an ethanol pipeline, but any project would take several years to complete.

Schock said he hopes for a decision on whether to move forward by the end of year or early 2010.


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## hkskyline

*Zoo poop may hold renewable fuel secret *
1 August 2009

NEW ORLEANS (AP) - Hippos and other plant-eaters in the zoo may hold the secret to renewable fuel, say researchers at Tulane University.

From those animals' feces, the scientists have identified more than a dozen different strains of bacteria that can help turn plant waste into butanol, an alcohol that can fuel internal combustion engines.

"It sounds -- and is -- humorous, the image of scientists running around the backside of a giraffe or hippo," said Eric Smith, associate director of the Tulane Energy Institute, "but these animals evolved an efficient way of consuming cellulose long before we thought about it."

Since the 1950s, butanol has been commercially manufactured using petrochemical processes, though it is also a natural result of fermentation.

Energy Institute scientists have been working for just more than a year on a project to identify and genetically engineer bacteria to create butanol. The work is funded in part through a grant the U.S. Department of Energy awarded to the coalition of six Louisiana universities that comprise the Clean Power and Energy Research Consortium.

"We are on the cutting edge here," said W.T. Godbey, a Tulane assistant professor of chemical and biomedical engineering and one of the project's investigators.

Once the researchers determine the best bacteria for producing biobutanol, they intend to genetically modify them to produce higher yields of the chemical and to digest cellulose so plant material that might otherwise wind up in landfills can be used to produce fuel.

Smith said butanol could offer a way around many of the problems that plague ethanol, an alcohol already in widespread use as a fuel source.

Butanol contains significantly more energy per volume than ethanol, blends more readily with gasoline and can be distributed through existing pipelines, whereas ethanol has to be trucked or moved by rail across the country and blended at the last minute since ethanol-gasoline blends are sensitive to moisture, Smith said.

In addition, there are questions about whether using ethanol actually saves energy, and it creates competition between fuel and food needs.

In the United States, most ethanol is produced from corn, a notoriously energy-intensive crop, and the total energy balance of the production process is unfavorable, Smith said.

"You don't really save that much energy over standard gasoline," he said. "Butanol is basically just a better fuel."

Godbey said researchers have been surprised by the number of animals they have found whose feces have proven valuable for butanol-producing bacteria. They are still evaluating which of the samples contains bacteria best-suited to their purposes.

"Giraffe," he said, "made the top 13."

Within the year, Godbey said his team hopes to be able to produce enough butanol to power a small motor.

"Keep in mind," he said, "just producing it isn't the only problem. We also have to isolate it, purify it."

The bacterial fermentation process, he explained, produces a variety of metabolic byproducts, with butanol being "just one of dozens."

Ultimately, Godbey said his team's research is likely to appeal to an oil company that could opt to use biologically produced butanol as a fuel additive.

There is already interest to that end.

In 2006, British Petroleum and DuPont announced a partnership to develop butanol made from sugar as a biofuel in the United Kingdom.

But butanol also might carry applications for everyone from home consumers looking to get rid of old newspapers to sugarcane farmers wondering what to do with mountains of bagasse resulting from sugar processing, Godbey said.

Researchers envision sugarcane farmers eventually equipping their facilities to manufacture biobutanol during months when sugarcane is not in production, potentially providing for increased employment opportunities and profitability.

Instead of going to the landfill, those waste products could be used to make fuel, Godbey said.

"What we're doing is basically opening up a brand new energy source that used to be considered a waste."


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## hkskyline

*US energy secretary travels to Rochester to study Minnesota renewables *
3 August 2009

ROCHESTER, Minn. (AP) - A mobile self-contained ethanol plant and solar-powered cars will be on display in Rochester for an important audience: U.S. Energy Secretary Steven Chu.

He'll be in the southern Minnesota town Monday to get a firsthand look at some renewable energy projects in the works . Chu will be accompanied by Democratic Congressman Tim Walz.

The two will see products that were created by area residents and college students.

Also up for examination is a wind turbine training facility. That's where electrical workers learn how to service the expanding number of wind turbines used for energy production.

Chu has a background in physics and has won a Nobel Prize.


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## hkskyline

AP
August 2, 2009 Sunday
*Slice of central US safe from recession shrinking*

Carl Rupp and his neighbors follow the old rancher's creed: "Keep your money in your pocket."

Rupp has farmed his whole life. He lives in Goshen County, a rural spot along the Nebraska line where cattle outnumber humans 16 to 1 and you can still see the ruts cut by wagons that hauled pioneers along the Oregon Trail. "We're very conservative," said Rupp, 62. "We don't go out too far on a limb."

That prudent financial bent, matched with the high prices paid for crops and energy in the past few years, has largely protected Goshen County and a core group of several hundred other counties in 10 states from the recession's chokehold. The Associated Press Economic Stress Index shows they make up a "safe zone" that covers a long swath of middle America, from the Great Plains south to Texas.

But the safe zone is shrinking. Energy production and prices are sliding, especially for coal and natural gas. Crop prices are dropping, too, as there's less demand in Asia for American wheat, corn and soybeans. There were 800 counties in the safe zone a year ago, a number that dropped to about 300 counties in May and slid further to 200 counties in June.

"To say that you're doing pretty well is just to say that it's the best-looking puppy in a pretty ugly litter," said Wyoming Gov. Dave Freudenthal, who recently imposed a 10 percent budget cut across his state's government in response to falling tax revenue from the energy sector.

The contiguous counties in the safe zone start in Montana and North Dakota, and cascade into Wyoming, South Dakota, Nebraska, Iowa, Kansas and Oklahoma, and end in northern Texas and eastern New Mexico. Those in the safe zone had an AP Economic Stress score under 5 in June, making them the economically healthiest in the United States.

The AP calculates a score from 1 to 100 based on each county's unemployment, foreclosure and bankruptcy rates. The higher the score, the higher the economic stress.

The safe zone is largely rural all but a dozen of the counties have populations of less than 25,000 people, many of whom make a living in agriculture. As the rest of the nation was riding the mortgage bubble, many farmers and ranchers in the safe zone who suffered through the agriculture crisis of the 1980s took on comparatively little debt. And when the recession hit, it didn't dampen demand for the row crops grown on the Great Plains.

Consumption of food and feed grains has increased 3 to 4 percent annually in recent years, while a federal mandate that gasoline contain certain levels of ethanol has also kept demand for corn and soybeans high.

"The last few years, ag has been pretty good," said Rupp, who sells alfalfa to dairies and feedlots. "In the long run, if there is such a thing, it's more stable than being in a county with energy as a primary industry. We miss out on the booms and busts, but overall we're in pretty good shape."

But while not in a bust cycle, ag prices are still down enough from last summer's highs to worry Doug Goehring, North Dakota's agriculture commissioner.

"If you really want to hurt the economy, beat the heck out of agriculture," Goehring said. "It is a primary sector in our economy. It is generating new wealth. You can't just rely on services to drive your economy."

Elsewhere in the safe zone, the business is energy, and the recession is starting to take a toll on a business that was booming. While oil prices have increased this summer, it's the price of natural gas and coal that matters most here. Natural gas that traded for nearly $13 per 1,000 cubic feet last summer is now available for less than $4. The spot price for coal is running around $9 a ton, down from about $13 last year.

The number of rigs in Wyoming drilling for coal bed methane dropped to zero in May, down from 19 the previous year, while the number of conventional rigs drilling for natural gas and oil is off by more than half. No coal mines have closed, but annual production could drop as much as 10 percent as the recession stalls the need for electricity nationwide.

"The prices of coal are down. Production is going to be down," said Marion Loomis, executive director of the Wyoming Mining Association. "So we're going to see a pretty significant reduction probably this year, and it's really just based on the amount of electricity that the country is using."

When booming, energy extraction kept unemployment low. In Oklahoma, for example, unemployment began creeping upward not long after as energy prices began sliding in September. It stood at 6.3 percent in June, up from 3.8 percent in June 2008. Wyoming's unemployment rate was 5.9 percent in June far below the national average of 9.5 percent, but the highest in the state since June 1999.

Because of a 45-percent dip in demand for its drilling services and installing pipeline, Three Way Inc. of Buffalo, Wyo. has laid off 145 workers, about 60 percent of its work force from last summer. It was among a dozen companies in northeastern Wyoming's coal-rich Powder River Basin that recently auctioned off hundreds of trucks, trailers and other equipment, said company controller Alex Mantle.

"Definitely people see some doom and gloom and are certainly disappointed," Mantle said.

Because of their small size, the AP index lacks foreclosure data for about half of the 200 counties that made up the safe zone in June; those with a population under 25,000 were assigned a foreclosure rate of zero. But there is widespread anecdotal evidence that real estate is an anchor in a place where many families proudly trace their land titles to homesteading ancestors who settled the frontier in the 1800s.

Aided by low interest rates, the value of farm and ranch land has grown by double digits this decade. Unlike California or Florida, there was no largely speculative housing bubble here.

Mike Daly started First State Bank of Wheatland in 1981, first setting up shop in a mobile home in a southeastern Wyoming town surrounded by lush farmland. His bank, which now has several branches, never got into the subprime mortgage market, and he said his customers prefer the traditional fixed-rate, 30-year home loans.

"The vast majority of our borrowers have had a pretty good run. And by that, I'm going to say eight to nine years of really (ag) good prices," Daly said. "They've increased their equity positions, they've paid down debt, and they're in a position, for the most part, to weather the storm."

Associated Press writers Dale Wetzel in Bismarck, N.D., and Murray Evans in Oklahoma City contributed to this report.


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## Whiteeclipse

*Corn as Biomass Electricity 22x More Efficient Than Ethanol*
Cheap fossil fuel has allowed us to waste the majority of our energy, filling the planet with pollution and waste heat. Our car engines are only 25% efficient and coal power plants are not much better. Corn ethanol is one of the worst wastes of biomass: An acre of corn produces about 330 gallons/year if you cook it using fossil fuel.

Use the ethanol as a heat source and the net yield drops to 214 gallons/year. Car gas mileage is 30% lower with ethanol. At 25 miles/gallon we can only drive 25 X 214 = 5350 miles per year on an acre of corn.

If we take that same acre of corn and burn it to make electricity to charge an electric car, we will be able to drive the car 22 times as far! About 117,096 miles per year!

The energy content of dry corn biomass is about 7000 Btu/lb or 4100 kWh/ton

With an 85% efficient CHP plant the net power out is .85 X 4100 = 3485 kWh/ton

An acre of corn yields about 8.4 dry tons/yr or 8.4 X 3485 = 29,274 kWh per year

The Tesla electric car goes 4 mi/kWh (EPA) 4 X 29,274 = 117,096 miles!

We don't have very many 85% efficient Combined Heat and Power (CHP) biomass power plants in the U.S. In fact, only 8% of our power plants are CHP plants. But Denmark has 53%, Holland 39% and Finland 38%. CHP plants are extremely efficient with many exceeding 90% efficiency! The secret of CHP is to locate the plant near where heat is needed. The waste heat from electricity generation is then sold along with the electricity so the only real waste is the heat that escapes into the air or past the heat exchangers in the stack.

CHP requires a different way of thinking. You must look first for places you can sell heat. Electricity is easy to distribute but heat is harder so location and sizing of plants must follow the heat demand. Mammoth gigawatt-scale power plants cannot do CHP unless they are built adjacent to a mammoth cement plant, kiln or steel plant. Most mammoth plants today dump about 2/3rds of their power into a stream or ocean just to get rid of it. A horrible waste!

High-rise buildings, hospitals, industrial parks, shopping centers, apartments, housing tracts and hotels are all excellent candidates for CHP power. Hot water, heat and cooling needs are generally comparable to electric power needs so 50% efficient electrical generators are a perfect fit: The wasted heat from the generator is simply used as heat. Fortunately, the needed technology is appearing just on schedule. Fuel cells can generate electricity with 50-60% efficiency from natural gas or syngas from biomass. One of the reasons mammoth power plants were built in the past was that only very large turbines were efficient. The other reason was pollution control. Neither reason applies today, as gas and biomass burn clean, particularly in a fuel cell.

Fortunately, we have a glut of natural gas from new shale bed discoveries. Gas is very convenient in cities, while biomass can generate carbon free power in more rural areas. Switching from coal power to CHP gas power has a massive impact on greenhouse gas emissions. Natural gas produces only 55% as much carbon as coal. CHP plants are three times as efficient (85% vs. 28%) so the resulting emissions are only .33X.55= 18% of a coal plant producing equivalent power! That's a better improvement than the planned 40% CO2 output of Futuregen and we don't have to wait decades for it to happen. With 3X better fuel economy, natural gas is way cheaper than coal and we won't run out of natural gas for a long time.

Giant power plants are custom designed and take 10 years to build. Smaller, modular CHP plants can be based on standard pre-approved designs with components built on mass-production lines like cars. The capital cost can be much lower than large plants. There are several mass-produced home-sized CHP units coming on the market now based on fuel cells. Honda already shipped 50,000 of their Ecowill units in Japan. These units are 85.5% efficient by using generator-wasted heat to make hot water.

What we need now are standard CHP generator designs in the 1-MW to 5-MW size that can run on natural gas or biomass. A biomass unit could be used on a farm to heat greenhouses, cold storage, fish ponds or brick production. Burning 2 MW of biomass would produce 1 MW of heat and 1 MW of electricity. 1 MW of electricity is 8,760,000 kilowatt-hours per year, worth about $876,000 per year. The heat is worth about 1/3 as much. Carbon credits and Renewable Energy Credits add to the income.

To feed a 2-MW gasifier with corn, the farmer would need only about 68 acres of land. Other, more prolific feedstocks like elephant grass could probably get by with only 23 acres. In Germany they have straw bale gasifiers that simply require the farmer to throw in a new bale periodically. The control microcomputer rings the farmer's cell phone with a text message whenever a new bale is needed.

This decentralized free enterprise approach could revolutionize our power structure in short order. Denmark changed their utility laws in 1990 and within 10 years 45% of ownership of power generation had shifted to consumer owned and municipality-owned CHP plants (25%) and wind turbines (20%). Ironically, ten years is about the time it takes to build one giant nuclear or "clean coal" plant. Distributed power eliminates the need for massive expansion of our power grid to connect old-style monster power plants. Distributed power also reduces power transmission losses since power is consumed near where it is generated.

The U.S. is way behind in efficient power generation because our utilities laws encourage massive inefficient power plants. If we can change that legal environment we can unleash a revolution that will dramatically reduce pollution and global warming, create good jobs and reduce our heat and power costs. The problems are political, not technical!
http://www.reuters.com/article/mnGreenAutos/idUS7504032220090729


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## hkskyline

Do they need to build new power plants for biomass or can present facilities be used but just put in different inputs?


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## Whiteeclipse

hkskyline said:


> Do they need to build new power plants for biomass or can present facilities be used but just put in different inputs?


Depending on the material that they plan to use to burn which would allow them to use present coal facilities replacing some parts.

http://www.newearth1.net/ this company makes coal pellets from biomass to replace coal in coal plants, they are in talks with some big coal power plant companies to replace coal in the power plants


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## hkskyline

*Ethanol plant in Va moving ahead, despite find*
18 August 2009

HOPEWELL, Va. (AP) - The builder of a proposed $150 million ethanol plant in Hopewell said the discovery of contaminated soil at the construction site will not slow the construction schedule.

The contaminated soil has been collected and now sits in piles at the site of the future Osage Bio Energy plant.

Osage's John Warren described the contamination level in the soil as very low. The company is working with the state to decide what to do with the soil, after it has been analyzed.

Despite that development, Warren said Osage is still scheduled to begin production in 2010. The plant will use winter barley to make the gasoline additive.


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## hkskyline

*U.S. ethanol group wants origin labeling for oil *

NEW YORK, Sept 1 (Reuters) - A U.S. ethanol industry group is pushing lawmakers to craft legislation requiring gasoline filling stations to inform customers what country their fuel came from in hopes of increasing awareness about money spent on oil imported from overseas.

"Most Americans don't want their paychecks going to Venezuela and other regimes that don't agree with and support the U.S," said retired U.S. Army General Wesley Clark, who co-chairs Growth Energy, the industry group behind the push.

Clark said Growth was targeting lawmakers such as U.S. Rep. Collin Peterson, chairman of the House agriculture committee, and others from fuel-producing states, and urging them to craft legislation that would require such labeling.

He said the United States spends tens of billions of dollars a year on protecting shipping lanes for oil. Some of that could be saved by increasing production of U.S. oil and developing alternative fuels like ethanol and fuel-sipping cars, he added.

U.S. oil production peaked in the 1970s which means the world's largest fuel consumer has to import most of its crude.

Clark stopped short of saying the labeling would cut U.S. consumption of oil from countries whose governments are not friendly to Washington. But he said it would give consumers more choice on deciding what kind of fuel, or alternative fuel automobiles, they want to buy.

U.S. ethanol producers, pushing to boost the allowable level of ethanol in regular gasoline from 10 percent to 15 percent, could benefit if U.S. dependence on foreign oil fell.

Phil Flynn, an oil analyst at PFGBest Research in Chicago, said Growth's strategy was a sign the ethanol industry, which has gone through several bankruptcies this year and last, was experiencing troubles during the recession.

"The industry is hurting right now and they want to get a boost by trying to get a little nationalism around a barrel of oil and push alternative fuels," he said.

But even if Growth persuaded lawmakers to craft a bill and it got passed, such a plan could be hard to implement because of the rivers of fuel that flow from refineries which can get mixed by the time they reach filling stations. It would be even harder to make any dent in sales from foreign oil producers, Flynn said.

"At the end of the day if we end up not buying that oil, it's just going to be bought by someone else."

Growth Energy also launched a website called labelmyfuel.com which details its caluculations on the cost of American dependence on foreign oil.


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## hkskyline

*Global Energy sells ethanol plant; owner to use as demonstration site for biofuel technology *
4 September 2009

ATLANTA (AP) - Global Energy Holdings Group, Inc. said Friday it will sell an ethanol production plant to Fiberight LLC. Terms of the sale were not disclosed.

Atlanta-based Global Energy said the plant had stopped production in May of last year. Prior to that, the facility in Blairstown, Iowa, was producing 5.6 million gallons of corn-based ethanol per year.

Global Energy said in a news release that Lawrenceville, Va.-based Fiberight plans to use the facility to produce cellulosic ethanol using its waste-to-biofuels technology.

Global Energy stock added less than a penny to 11 cents a share in Friday trading.


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## hkskyline

*Frost fears to keep US grain markets nervous-panel *

CHICAGO, Sept 11 (Reuters) - U.S. farmers look set to harvest huge corn and soybean crops this year but the possibility of frost later this month is keeping the markets on tenterhooks, analysts told a panel hosted by the Chicago Board of Trade on Friday.

A slumping dollar and recent falls in futures prices at the Chicago Board of Trade were drawing strong export demand, analysts Jim Bower of Bower Trading and Don Roose of U.S. Commodities also told the panel on the U.S. Agriculture Department's September crop report.

"Planting got off to a late start, particularly in southern Illinois, Indiana and Kentucky. The trade is still worried about development and maturity of the crop," Bower said.

"We still have to be wary for the potential for an early frost," he said, adding that a weather model was showing low temperatures for Sept. 23 and 24. "I am concerned, particularly about corn and soybeans that were planted late."

The USDA, in its September crop report, estimated the soybean crop at 3.245 billion bushels, just below an average of trade estimates for 3.249 billion bushels. The USDA pegged the corn crop at 12.954 billion bushels, above an average trade estimate for 12.901 billion bushels. 

U.S. Commodities' Roose said traders were expecting large production numbers for corn and soybeans, and added that the USDA had raised its estimates for demand.

"Big crops typically get bigger. Demand is the great equalizer," he said, adding that with the declining value of the dollar, "We have been able to buy demand."

The USDA raised its estimate of U.S. corn exports to 55.88 million tonnes in the 2009/10 marketing year that began Sept. 1 from its August estimate of 53.34 million tonnes.

The amount of corn used to feed livestock in the United States was raised to 135.90 million tonnes from an estimated 134.63 million in August.

The livestock sector has been suffering under the weight of high feed grain prices, slower demand due to the recession and the spread of the H1N1 flu globally.

The USDA, however kept its estimate of the amount of corn used to produce ethanol at 4.2 billion bushels, in a possible indication that the industry was still struggling from the fallout of last year's run-up in corn prices to record highs.

Roose also said the weather through September was going to be an important factor to crop development.

"It's going to be a race to the finish," he said. "Weather will be a constant feature each week. When a cold mass comes down, it makes the trade a little bit nervous."

Traders were expecting Chicago Board of Trade corn futures <0#C:> to open steady to 2 cents per bushel higher on Friday, and soybeans were called mixed, up 5 cents to down 5 cents. 

The U.S. dollar fell to a one-year low against major currencies as optimism about the global economy after strong Chinese data encouraged investors to favor higher yielding currencies and stocks.


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## hkskyline

*Cane ethanol helps cut greenhouse emissions -study *

SAO PAULO, Oct 14 (Reuters) - Use of sugar cane-based ethanol as a substitute for gasoline is among the cheapest and easiest ways to reduce greenhouse gas emissions, according to a Brazilian study published on Wednesday.

Cane ethanol provides about eight times the energy used to produce it and adoption of new cane plant varieties and processes could increase its efficiency further.

The study looked only at the future production of cane over pastures or as a replacement for other crops -- not over native forests.

Most new cars in Brazil can run on ethanol alone and the biofuel's environmental benefits are redoubled by burning its bagasse byproduct in thermoelectric plants powering mills and sometimes even feeding into the grid.

"As ethanol is already competitive with gasoline at current oil prices, the additional cost (in adopting ethanol) is zero," said Isaias Macedo, from the Interdisciplinary Center of Energy Planning at the University of Campinas, one of the study's authors.

"And the possibility of producing ethanol in several countries makes it especially attractive," Macedo added.

Brazil is the world's largest producer of cane-based ethanol. The United States is the No. 1 ethanol maker but its fuel is made from corn whose energy output is roughly equal to that used to produce it.

Ethanol's gradual replacement of gasoline since the introduction of flex-fuel cars in early 2003 and the blending of 20 to 25 percent of ethanol in all gasoline sold in Brazil, combined with the co-generation of energy through the burning of bagasse at mills, has slashed greenhouse gas emissions.

In 2006 alone, the drop in emissions by the transport and energy sectors was 22 percent of what they would be if the country's cars were burning gasoline, according to the study.

Still, Brazil remains one of the top emitters of greenhouse gases due to destruction of its massive Amazon rain forest. Trees release carbon dioxide into the atmosphere when they're felled or burned.

Considering Brazil's total emissions unrelated to deforestation, ethanol helped reduce overall emissions by 10 percent that same year, according to the study which also involved researchers at the University of Sao Paulo.

Considering fuel production and emission-cutting targets set by Brazil in its 2008's climate change plan, ethanol could reduce emission levels in the transport and energy sector by 43 percent in 2020 and 18 percent for all emissions excluding deforestation.

Brazil is seeking to play a leading role in talks in Copenhagen in December aimed at agreeing a new climate treaty to replace the Kyoto Protocol when it expires in 2012.

The ethanol industry does not want Brazil's poor ranking for total emissions to tarnish its environmental credentials. It has been fighting to show the world how cane is the most energy-efficient raw material for ethanol.

About 90 percent of Brazil's sugar cane is produced in the center-south region, which includes Pantanal wetlands. But the main producing areas are about 2,000 km (1,250 miles) from the Amazon forest. The rest in the north/northeast of the country.

Macedo said that, based on an estimated cost of $100 per tonne of CO2 avoided in 2020 or 2030, it would be possible to attribute to ethanol an additional value of 20 U.S. cents per liter.

"When you decide to use ethanol, this is how much you'll avoid paying for another option," the researcher said.


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## hkskyline

*UN cautions over biofuels green credentials *
16 October 2009
Agence France Presse

The use of biofuels as a source of clean energy may lead to higher carbon emissions, but can also yield significant cuts if production is properly managed, the UN Environment Programme said Friday.

As such, governments should assess energy needs, effects on climate, land and water use as well as agriculture if biofuel projects are to be beneficial.

Citing a report by its Panel for Sustainable Resource Management, the UN body noted that Brazil's biofuel production can lead to between 70 and more than 100 percent emission reduction when substituted for petrol.

But some biofuels -- produced for example from oil palms grown in deforested tropical peatlands -- can be responsible for a rise in greenhouse gas emissions of up to 2,000 percent compared with fossil fuels, as a result of carbon releases from the soil.

"The debate whether it is good or evil is not a rational one. Like all technologies, biofuels represent both opportunities and challenges," UNEP's director Achim Steiner said.

"The way in which biofuels are produced matters in determining whether they are leading to more or less greenhouse gas emissions."

Biofuel's green credentials depend on whether it is based on crops or production residues and waste, the latter being more environmentally friendly, said the report entitled: "Towards Sustainable Production and Use of Resources: Assessing Biofuels."

For instance, Brazil's sugarcane-to-ethanol production is considered beneficial because it uses cane waste known as bagasse to power the processing and also generates electricity for the national grid.

Palm oil biodiesel on the other hand can reduce emissions when compared to fossil fuels by 80 percent, but if it is grown on land from cleared tropical forests, greenhouse gas emissions can rise 800 percent, or higher.

Up to 34 percent of arable land worldwide would be needed -- with the current technology -- to produce 10 percent of the world's transport fuels, the report added.

Critics say biofuel production eats up chunks of arable land needed to feed the world population for negligible carbon emission cuts.

The report called for a "reconsideration of current biofuel mandates, targets and quota in order to limit the demand to levels which can be sustainably supplied."

"It is also a choice about how humanity best manages its finite land bank and balances a range of competing interests in a world of six billion people, rising to over nine billion by 2050," Steiner said.


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## hkskyline

*ANALYSIS-Agriculturals to emerge from the shadows in 2010 *

LONDON/NEW YORK, Oct 16 (Reuters) - Agricultural commodities could be poised for stardom in 2010 as weather concerns and alternative fuel needs throw up strong fundamentals, after lagging other commodity sectors this year.

Softs, in particular sugar, will be volatile into 2010 -- but offer good returns for those with a strong stomach -- due to persistent rains in top producer Brazil, and India, the world's largest consumer, shifting from a major exporter to an importer.

"Sugar has very strong fundamentals that are here to stay for more than a few months," said Emmanuel Jayet, a commodities analyst with Societe Generale.

Peter Lucas, investment strategist with RBC Wealth Management, said softs offered good value, but also singled out corn and wheat for next year.

Corn consumption has risen to record levels, boosted by the expansion of the U.S. ethanol programme, leading to a drawdown in global stocks.

The International Grains Council last month forecast corn stocks at the end of the 2009/10 season (July/June) would fall to 134 million tonnes, down from 147 million a year earlier.

"In my opinion corn is the market which gives the trend of the grain market in general and we will have decreasing stocks. I think corn prices will increase next year," Societe Generale's Jayet said.

"Ethanol consumption in the U.S. is breaking new records every month," he added.

BEHIND THE CURVE

Lucas said agriculturals had lagged a cyclical-driven rally in which base metals out performed due to expectations of growing demand as the global economy recovered.

Copper has surged 117 percent since the end of 2008 and crude oil is up 98 percent.

Among agriculturals and softs CBOT wheat is down 15 percent, corn is off 8.6 percent, cocoa is up 23.5 percent and arabica coffee is up 27.6 percent.

Lucas also said "the overall environment is competitive for a commodities rally, because of the weak dollar".

A weaker dollar makes investment cheaper for holders of other currencies. The dollar has fallen 6.5 percent so far this year against a basket of currencies and is widely expected to extend that drop.

But investing effectively in softs will be a question of getting the right balance between fundamentals and technical charts. Softs' performance has varied greatly due to their separate fundamentals.

Raw sugar, for example, has soared 111.7 percent since the end of 2008, largely because of India's poor harvest, and on expectations of another disappointing crop next year following a weak monsoon.

Cocoa set the highest levels in nearly 25 years in London a week ago, powered by expectations of improving demand and worries over tight supplies from top producer Ivory Coast and other key West African growing regions vulnerable to disease and pests.

Commodity fund manager John Di Tomasso, president of Di Tomasso Group Inc. in Victoria, Canada, advocated a "middle approach" to investing in soft commodities, particularly after new milestones set in recent weeks by sugar, cocoa and coffee.

"We think some time in the next few years, the softs in general will do well, but some specific softs are overpriced at the moment," Di Tomasso said.

Improving prospects for grindings (a measure of demand) as the global economy shows signs of recovery has also supported cocoa.

"It is very clear that grindings are starting to recover, the onus is definitely on the supply side to be able to deliver and it just doesn't look likely," said Kona Haque, commodity strategist with Macquarie Bank.

Arabica coffee has risen by a quarter this year, driven by increased fund activity, the weak dollar, robust demand, and recent concerns over falling Colombian coffee supplies due to poor weather and a programme to replant ageing trees.

There are also worries over weather in top coffee producers Brazil and Vietnam.


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## hkskyline

*China tariff cut could open ethanol import door *

BEIJING/SAO PAULO, Dec 18 (Reuters) - China's decision to lower a tariff on alcohol imports could also apply to fuel ethanol, traders said on Friday, potentially opening the door to imports from countries like Brazil.

But even if imports were financially viable, China's lack of the capacity needed to blend the more environmentally friendly fuel into gasoline meant there was little chance of a flood of imports into the world's most populous nation, traders said.

China's Finance Ministry announced this week that the import tax for alcohol and other denatured spirits would be 5 percent from Jan. 1, down from the current 30 percent.

On the supply side, a complicated sugar cane harvest in Brazil, the world's top exporter of ethanol, will result in lower supplies of the biofuel over the next few months.

Brazil distills its ethanol from sugar cane. Excess rains have reduced output this season and mills have preferred to produce sugar -- with prices hovering at record highs -- instead of ethanol.

"The low tariff appears to make imports viable. But we are studying if there are other restrictions," said one trader with an international trading house based in China.

Traders were still trying to confirm that the reduction would apply to fuel ethanol. Officials could not be reached for comment.

Another trading manager said the tariff reduction, part of Beijing's commitment to reduce overall import duties as a member of the World Trade Organisation, would not result in large imports soon.

"The reduction can lead to imports in an indirect way, which will be the future trend. But we do not expect imports to happen within a short period of time."

He said buyers would have to set up blending facilities, currently under control of state-owned companies. Beijing mandates use of ethanol-blended gasoline only in about one-third of Chinese provinces.

China won't allow any major expansion of grain-based ethanol production due to food security concerns, and expansion of the biofuel using feedstocks other than grains is restricted due to limited farmland and water resources.

The government aims to blend 2 million tonnes of ethanol in gasoline by 2010 and 10 million tonnes by 2020 as part of efforts to help reduce greenhouse gas emissions.

But industry officials doubt the target can be fulfilled as current facilities can only produce about 1.35 million tonnes.

Chinese companies are working to use cellulosic materials to produce ethanol, but commercial production will still take years.

LOW SUPPLIES

Brazil has been pushing China to import Brazilian-made fuel ethanol as a complement to China's own limited production.

Producers in Brazil praised the tariff decision but said exports were unlikely in the short term as the main center-south cane region heads into the quiet inter-harvest period and supplies are smaller than usual. 

Brazil's next cane season begins officially on April 1.

"The decision was highly positive for the future but right now exports are quite improbable as we don't have enough supplies," said Antonio de Padua Rodrigues, technical director at the Sugar Cane Industry Association (Unica).

Besides, ethanol prices are currently above average while the local currency has appreciated against the dollar, which reduces the competitiveness of the Brazilian ethanol in the global market.

But if China decided to sign long-term deals with Brazilian companies, this could end up boosting investments in production in the Latin American country in the years ahead, Padua said.

China accounted for less than 0.1 percent of the 5.1 billion liters of ethanol exported by Brazil in 2008 and didn't make any purchases this year.


----------



## Acerola

Whiteeclipse said:


> *Corn as Biomass Electricity 22x More Efficient Than Ethanol*
> Cheap fossil fuel has allowed us to waste the majority of our energy, filling the planet with pollution and waste heat. Our car engines are only 25% efficient and coal power plants are not much better. Corn ethanol is one of the worst wastes of biomass: An acre of corn produces about 330 gallons/year if you cook it using fossil fuel.
> 
> Use the ethanol as a heat source and the net yield drops to 214 gallons/year. Car gas mileage is 30% lower with ethanol. At 25 miles/gallon we can only drive 25 X 214 = 5350 miles per year on an acre of corn.
> 
> If we take that same acre of corn and burn it to make electricity to charge an electric car, we will be able to drive the car 22 times as far! About 117,096 miles per year!


Some of ethanol plants in Brazil use the sugar cane waste used to produce ethanol as biomass to produce eletricity. So yout theory is wrong and outdated.


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## hkskyline

What are some alternate sources of ethanol that will be more green and less demanding on our food supply?


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## CptSchmidt

I'm not sure that people realise that it takes more fuel to create ethanol than it generates.


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## Suburbanist

It depends on the crop used to make it: as previous article says, sugar cane is energy net-effcient by a factor of 8, whilst corn is non-eficient by a factor of 0.14. Other crops (palm, grass) have different factors. Not every ethanol is the same!

Indeed, ethanol use as automotive fuel (at 20-25% additive in gasoline) in Brazil has spared the country more than US$ 210 billion in oil imports over tha last 34 years).

As for "competition with food production", eventual cost increases are more than bareable by developed countries costumers and most of those in intermidiate-developing stage like Brazil, Mexico or Russia.


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## hkskyline

*Tests see how snowmobiles run on high ethanol fuel *
9 January 2010

HOUGHTON, Mich. (AP) - Snowmobiles that don't start when it's cold aren't good for much.

That's why researchers at Michigan Technological University are trying to see how well snowmobiles can perform using fuel with higher levels of ethanol than those in today's gasoline.

Federal regulations require that use of renewable fuel use increase from 9 billion gallons to 36 billion gallons by 2022.

"Cars and trucks are being designed to run on these ethanol-rich fuels. But can a snowmobile?" Michigan Tech writer Marcia Goodrich asked in a story posted on the Houghton school's Web site.

This winter, engineering assistant professor Scott Miers is conducting a study to see how snowmobiles can function with ethanol levels of 15 percent, compared to the current 10 percent, known as E10.

Americans own about 1.7 million snow machines.

Miers is testing snowmobile emissions and fuel economy in the lab and on the trail. He's also looking at how they start at low temperatures.

"If you can't start in the cold, you can't snowmobile," Miers said in a statement.

The research is taking place in cooperation with the Society of Automotive Engineers' Clean Snowmobile Challenge. Michigan Tech hosts the event each year. It's set for March 15-20.

In the event, engineering students take reengineer a snowmobile to reduce emissions and noise while maintaining or boosting performance.

"This study is a great fit for the Challenge," said challenge organizer Jay Meldrum, executive director of the Keweenaw Research Center. "The snowmobiling community is wondering what will happen if ethanol increases to E15 or E20."

The $69,000 project received $25,000 from the state Department of Energy Labor and Economic Growth.


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## hkskyline

*Brazil opens world's first ethanol-fired power plant*

JUIZ DE FORA, Brazil, Jan 19 (Reuters) - Brazil on Tuesday opened the world's first ethanol-fueled power plant in an effort by the South American biofuels giant to increase the global use of ethanol and boost its clean power generation.

State-run oil giant Petrobras and General Electric Co , which helped design the plant, are betting that increased use of ethanol generation by green-conscious countries will boost demand for the product.

Brazil, the top global ethanol exporter, is already in talks with Japan to develop biofuels power generation there.

"We have great expectations to show the viability and economy of generating electricity from ... an alternative feedstock to fossil fuels," Maria das Gracas Foster, head of Petrobras' natural gas division, said.

Petrobras with the help of GE upgraded the 87-megawatt power plant to switch between running on natural gas or ethanol instantaneously. Brazil primarily relies on hydroelectric power but needs backup thermoelectric generation during the dry season.

John Ingham, Latin America Products Director for GE, said tests showed switching the plant to ethanol reduced carbon dioxide emissions without lowering energy output.

GE has around 770 turbines like those used in the Juiz de Fora plant, including many in Japan, that could be converted to run on ethanol, he said.

"A plant like that consumes a lot of ethanol, so it has to be in a place that makes sense (such as) places that have no access to gas, like Japan, some islands, or places that depend heavily on diesel like the Amazon region," he said.

Brazil is expected to produce a record 27.8 billion liters of ethanol in the 2009/2010 season. It began its biofuels program 30 years ago and now mandates a minimum 20 percent of ethanol in gasoline.

Petrobras itself is only starting to enter the ethanol market. Brazil's ethanol production comes from sugar cane milled by companies such as Cosan or commodities giants including Cargill Inc [CARG.UL], Bunge and ADM Co .

Domestic demand for ethanol is being driven by the popularity of the flex-fuel car technology that was launched in 2003 and now makes up around 90 percent of new vehicle sales.


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## mopc

^^ I didn't know that. World's first? The Brazilian press didn't even pick up on that story. Your thread is great hkskyline, thank you.


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## nomarandlee

> *http://news.yahoo.com/s/ap/20100122/ap_on_bi_ge/us_farm_scene_sunflower_dna*
> *Sunflower DNA map could produce plants for fuel*
> 
> By DIRK LAMMERS, Associated Press Writer Dirk Lammers, Associated Press Writer – 1 hr 51 mins ago
> 
> SIOUX FALLS, S.D. – A $10.5 million research project aimed at mapping the DNA sequence of sunflowers could one day yield a towering new variety for both food and fuel.
> 
> *Researchers envision crossbreeding a standard sunflower with the Silverleaf species out of Texas to produce a hybrid with bright yellow flowers bursting with tasty seeds and thick stalks filled with complex sugars that can be turned into ethanol.*
> 
> *The wild, drought-resistant Silverleaf is known for its woody stalks, which can grow up 15 feet tall and 4 inches in diameter.*
> 
> "Since it's the closest relative of the cultivated sunflower, it should be perhaps reasonably straightforward to move some of the traits," said Loren Rieseberg, a University of British Columbia botany professor and leader of the DNA sequencing project.
> 
> The Genomics of Sunflower project is funded by Genome Canada through the Canadian government, Genome BC, the U.S. Energy and Agriculture departments and France's National Institute for Agricultural Research.
> 
> Its goal is to locate genes responsible for agriculturally important traits such as seed oil content, flowering, drought and pest tolerance. Participants plan to map the genome for the greater sunflower family, known in the science world as Compositae and including more than 24,000 species of sunflowers, lettuce, artichokes, daisies, ragweed, dandelions and other plants.
> 
> Scientists hope that within four years, they'll be able to develop a basis for a breeding program in which understanding of the plants' genes dramatically reduces the time it takes to develop hybrids.
> 
> Rieseberg's work with co-investigator Steve Knapp from the University of Georgia has already been helpful to the industry, said Larry Kleingartner, executive director of the Mandan, N.D.-based National Sunflower Association.
> 
> Their research helped identify a trait that imparts resistance to downy mildew, which destroys plant tissue, and its association with a gene that imparts resistance to rust, a fungus that affects yield and quality, Kleingartner said.
> 
> "That kind of information is so important so we don't have to go through eight years of grow outs to see if we've got this resistance in this hybrid," he said. "We can just do it on a very molecular basis."
> 
> The sunflower mapping venture is the latest of several plant genome projects.
> 
> In 2008, a group of researchers led by Washington University in St. Louis mapped the corn genome and posted its research on the Internet. The $29.5 million project, funded by the National Science Foundation and the U.S. Energy and Agriculture departments, will allow seed companies to tweak the genome to increase the plant's productivity.
> 
> Scientists also have mapped the genes of the black cottonwood tree, rice, the potato, the pinot noir grape and a weed called Arabidopsis thaliana.
> 
> Sunflowers are a nearly $14 billion a year industry, with some 32 million metric tons produced worldwide each year, according to the National Sunflower Association. In the United States, they're grown primarily in North Dakota, South Dakota, Kansas, Minnesota and Colorado. They're used primarily for cooking oil, although the seeds also are found in snacks and other products.
> 
> The family's genome is 3.5 billion letters long, which is slightly larger than the human genome.
> 
> Researchers say mapping the family's entire sequence could lead to crop improvement, weed control and the development of wood-producing varieties that could be used for flooring and other products.* Increasing the complex sugars in Silverleaf's stalk would make it a viable feedstock for ethanol, Rieseberg said.
> 
> "It's extremely drought tolerant and grows very, very tall," *he said.* "And what's remarkable is that it's pretty much wood from bottom to top, and yet it's an annual."*
> 
> The nation's 170 operating ethanol plants can produce 10.6 billion gallons of the fuel per year, according to the Renewable Fuels Association, but the vast majority of that fuel comes from corn. Growing criticism from a diverse alliance of cattle ranchers, grocers and environmentalists about using corn for fuel has prompted the industry to look at nonfood feedstocks such as switchgrass, corn stover and wood waste.
> 
> Congress had hoped ethanol production from nonfood sources would reach 100 million gallons in 2010, but companies are expected to fall far short of that goal.










..


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## hkskyline

_Heading back to the USA  _

*Kan. company plans electricty from crop waste*
20 January 2010

WICHITA, Kan. (AP) - Abengoa Bioenergy and Mid-Kansas Electric Co. have announced plans to build a commercial-scale plant in Hugoton designed to produce ethanol and electricity from crop waste.

The companies said Tuesday that the $550 million plant will be designed to generate 75 megawatts of electricity and 15 million gallons of ethanol per year.

The electricity will be sold to Mid-Kansas Electric.

The plant will be owned by an entity called Abengoa Bioenergy Hybrid of Kansas. Construction is expected to start in two years and be completed in 2012. The companies say the plant will eventually create 90 full-time jobs.

The companies say the plant will consume 2,500 tons of corn stover, wheat straw and switchgrass every day.

------

Information from: The Wichita Eagle


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## hkskyline

*Ethanol industry wants Iowa Legislature to require gasoline to have 10 percent ethanol *
25 January 2010

DES MOINES, Iowa (AP) - The Iowa Renewable Fuels Association wants Iowa to increase its use of ethanol in motor fuels.

Association vice president Monte Shaw notes the percentage of fuel sold in Iowa with ethanol blended in has been stuck around 75 percent. He says the percentage of ethanol-blended gasoline now stands at 80 percent in the rest of the nation.

To increase Iowa's consumption, Shaw says the association will ask the Legislature to pass a bill requiring motor gasoline in the state carry at least 10 percent ethanol.

Shaw estimates with a state mandate, ethanol use in Iowa would increase from 100 million gallons annually to about 140 million gallons.

Republican Rep. Annette Sweeney of Alden indicates there is interest in the Legislature in the ethanol producers' proposal.


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## hkskyline

*GM seeking more U.S. ethanol fueling stations *
16 February 2010

KISSIMMEE, Fla., Feb 16 (Reuters) - General Motors Co's growing output of vehicles capable of running on ethanol-gasoline blends won't help cut polluting emissions or U.S. dependence on foreign oil until a slim network of stations dispensing ethanol is greatly expanded, GM Vice Chairman Tom Stevens said.

Half of GM's vehicle lineup will be able to run on a mix of 15 percent gasoline and 85 percent ethanol, called E85, by the 2012 model year, said Stevens, GM's vice chairman for global product operations.

"GM is spending about $100 million a year adding flex-fuel capability to our vehicles. We can't afford to leave this capital stranded," Stevens is to tell attendees in a speech on Tuesday at the Renewable Fuels Association conference.

A copy of the speech was provided to reporters on Monday.

Adding the capability to run on E85 costs adds as much as $70 to the production cost of each vehicle, Stevens said.

GM has produced 4 million of the 7.5 million flex-fuel vehicles on U.S. roads now, said Coleman Jones, GM biofuel implementation manager.

Stevens said GM has worked with the National Governor's Association and ethanol producers and dispensers to add 350 more ethanol-blend pumps in the United States. He said GM would welcome federal government assistance to finance expansion of that network, but he offered no specifics on how that would work.

"Today's there's 2,200 (ethanol fuel stations) that are out there but that's not enough," said Stevens.

"Two-thirds of the pumps are concentrated in 10 states and those 10 states have only about 19 percent of the flex-fuel vehicles that we have on the road," said Stevens. "That's a big problem for us."

Those 10 states are all in the U.S. Midwest, heart of corn production in the United States. Corn is the dominant source of U.S.-produced ethanol.

Stevens said there are about 160,000 U.S. gasoline stations, and there need to be 12,000 or more ethanol stations "to have ethanol fuel available for every one of our customers within about two miles of where they live. So, we've got some work to do there to get the additional 10,000 pumps in." Ethanol-gasoline blends emit less polluting carbon dioxide than conventional gasoline, and is mainly produced domestically.

Energy legislation passed by the U.S. Congress in 2007 set binding targets for fuel blending each year. Ethanol use is to rise to about 20.5 billion gallons by 2015 and 35 billion gallons by 2022 from 4 billion gallons in 2006 and almost 13 billion gallons in 2009.

One gallon of liquid equals a litre.

The U.S. Environmental Protection Agency has said that ethanol-gasoline blends must increase the ethanol portion to much higher than the current limit of 10 percent, and increase use of other sources of ethanol than corn, such as switchgrass and landfill and farm waste.


----------



## hkskyline

*ANALYSIS-New US rules on corn ethanol may hurt environment *
18 February 2010
By Ayesha Rascoe

WASHINGTON (Reuters) - U.S. corn growers expressed relief when the Obama administration unveiled new environmental rules that would boost use of corn-based biofuel, but green groups complained the guidelines may fill the air with nitrous oxide, a greenhouse gas viewed as more potent than carbon.

The Environmental Protection Agency unveiled what amounted to a tweaking of the national renewable fuel standard in early February, and still found that ethanol made from corn is still cleaner than conventional gasoline, dashing the hopes of some critics who opposed using food to create fuel.

The EPA's new assessment basically calls for corn ethanol output to rise from around 12 billion gallons this year to around 15 billion gallons annually starting around 2015, which the industry was already on track to reach regardless of agency's action.

"The effect in reality on the industry is pretty much negligible," said John Sheehan, biofuels program director at the Institute on the Environment at the University of Minnesota.

The aim of the renewable fuel target is to move the country toward more production of advanced biofuels from sources such as wood chips.

But corn ethanol, which consumes about a third of the U.S. corn crop, will still likely make up about 42 percent of the 36 billion gallon biofuel mandate in 2022 -- something that will continue to support farmer incomes and help boost demand fundamentals of commodity markets.

Detractors of corn ethanol argue the 15 billion gallon output mandate will lead to larger corn crops, which will require the use of more fertilizers and pesticides.

Runoff from nitrogen fertilizers is already blamed for a so called "dead zone" in the Gulf of Mexico, where poorly oxygenated water is disrupting marine ecosystems.

Nitrogen in fertilizers can also form a compound called nitrous oxide that is more than 200 times worse than carbon as a greenhouse gas, said James Coan of Baker Institute for Public Policy at Rice University.

Rising corn harvests to meet more ethanol demand could exacerbate these issues, said Franz Matzner, a director for the environmental group, the Natural Resources Defense Council.

"We don't need more corn ethanol, what we need are more of the next generation biofuels that hold better energy potential, better climate reduction potential and better potential to protect our water quality and air quality," Matzner said.

The EPA used a method known as indirect land use change to help calculate the emissions of different fuel sources.

This method attempts to measure the emissions released when land is cleared in other countries to grow more food or biofuels to make up for the large amounts of land used in the United States to grow grains for ethanol.

The connection between U.S. agriculture and deforestation in developing countries is hotly disputed among experts and ethanol supporters.

"The responsibility for reducing C02 emissions associated with land use has to be with the folks that are actually using that land," said Robert Brown, director of Bioeconomy Institute at Iowa State University.

Still, despite its inclusion of indirect land use in final rule, the EPA determined that ethanol produced from corn at a natural gas-fired facility using efficient technologies met the law's criteria carbon emissions compared to gasoline.

This is where EPA rule took a wrong turn, the Baker Institute's Coan said.

"Corn ethanol should not be credited as better than gasoline," Coan said. "There used to be consensus that was the case, but now that nitrous oxide and land use changes are being looked at much more closely, that consensus is no longer there."

Coan, who co-authored a paper earlier this year on U.S. biofuel policy, said indirect land use changes matter because carbon emissions are a global problem and actions in the United States can affect other countries.

Ethanol backers have questioned the findings of Coan's paper because it was funded by Chevron Technology Ventures , but Coan pointed out that various papers have come out since 2007 questioning the benefits of ethanol.

One of the main selling points for corn ethanol is that it is supposed to be a green alternative to dirty fossil fuels. A 2007 law requires that corn ethanol produced at new plants release 20 percent less carbon dioxide than gasoline over its life cycle to qualify for the renewable mandate.

This standard will have little impact on most of the current U.S. ethanol capacity, because corn ethanol plants built before Dec. 19, 2007 are exempt from these rules.

Many U.S. farmers and ethanol backers challenge the environmental complaints. Dave Nelson, an Iowa farmer and a representative of the Renewable Fuels Association, said ethanol producers will continue to reduce the biofuel's carbon foot print.

"Older plants are going to adopt new technologies because it will make them more efficient and make them more money. The feed stock that the older plants will be using will be of the newest technology," Nelson said.


----------



## southwestforests

So many activists pro or con are spinning so many "facts" that I have no idea that the real situation is.
And I have no expectation that it now will ever be possible to know.

What I do know is that greenhouse operators ADD carbon doxide to greenhouse air so plants will grow better.

CO2 is what plants take in from air to use to make food out of.

So why are we trying to get it out of the atmosphere - we're on our way to possibly starving the very plants we need to eat to feed an increasing population !

Insanity.


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## Suburbanist

Corn, sugar-cane and other "fuel" crops are not grown in greenhouses lol.


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## Danfla

50% of brazilians cars use ethanol as fuel, and 10% use natural gas. So, use of ethanol in large scale is viable in others countries too.


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## hkskyline

*Proposal to remove ethanol labeling requirements at Nebraska gas pumps dies amid protests*
15 April 2011

LINCOLN, Neb. (AP) - A bill that would have repealed Nebraska's labeling law for ethanol-dispensing gas pumps has died.

Imperial Sen. Mark Christensen pulled his proposal Wednesday amid a surge of phone calls, letters and emails from Nebraskans who opposed the idea.

The bill would have eliminated the labeling requirement on any gas mixture that contains at least 1 percent ethanol.

Supporters say the current law promotes the false belief that ethanol can damage engines. They also argue that removing the labels would increase ethanol sales and the demand for Nebraska corn. Opponents say they want to know the kind of gas they're buying.

Nebraska is the nation's second-largest ethanol producer, behind Iowa, with 1.7 billion gallons in refining capacity. Its share accounts for 13 percent of the nation's capacity.


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## hkskyline

*Report Shows High Corn Prices Will Limit Ethanol Use, Raise Costs*
Thu May 5, 9:00 am ET
PRWeb

An Energy Policy Research Foundation, Inc. (EPRINC) report released on April 28, 2011 found that high and volatile corn prices will limit the success of a renewed push to expand access to ethanol via E15 and additional E85 fueling stations. The report also found that absent a mandate, blender's credit, and tariff protection ethanol would have a market of nearly 400,000 barrels per day, approximately half of today's consumption, which suggests that the real cost of the blender's credit is significantly higher than $0.45 per gallon. The study concludes that as the volumetric mandate takes ethanol blending past 10% of the gasoline pool, gasoline consumers and producers will face higher costs.

Washington, DC (PRWEB) May 05, 2011

The Energy Policy Research Foundation, Inc. (EPRINC) has released a report on the Renewable Fuels Standard, a government program that provide subsidies, tax incentives, and regulatory mandates to promote the use of corn ethanol and other renewable fuels into the national gasoline pool. The study concludes that one of the major obstacles to rapid increases of corn ethanol into the gasoline pool is the rising cost of ethanol's principal feedstock, corn. Corn prices have more than doubled over the past 10 months, an increase considerably greater than the rise in crude prices over the same period. Growing mandates for blending ethanol into the gasoline pool is likely to further increase prices at the pump. The report can be downloaded for free at http://eprinc.org/pdf/EPRINC-CornLimitsEthanol.pdf .

U.S. policy requiring ever-larger volumes of ethanol blended into the gasoline pool is now running into two distinct and important cost realities, both of which are likely to contribute to price increases in gasoline above the rising acquisition cost for crude now faced by domestic refineries. The first is the rapidly rising cost of corn. Disappointing U.S. corn yields, loss of wheat crops worldwide and increasing domestic and international demand for corn has pushed prices from $3.50/bushel to over $7.50/bushel since the summer of 2010, driving up ethanol prices to levels well above the cost of gasoline when adjusted on a GGE (gallon of gasoline equivalent) energy basis. Expanding access for ethanol in the gasoline pool will not solve the cost problem because it cannot provide a cost competitive alternative to E10, the type of gasoline used by most U.S. motorists.

The Congressional debate over the deficit has highlighted concerns over the cost of ethanol subsidies, now estimated at nearly $6 billion per year to encourage its blending into the gasoline pool. Ethanol also receives other government incentives such as loan and investment guarantees. Absent volumetric mandates and blending tax credits, the U.S. would consume approximately 400,000 bbls/day (barrels per day) of ethanol, half the amount of ethanol consumed today.

The RFS and related ethanol support (mandates, subsidies, and tariff protection) have resulted in some reduction in crude and gasoline imports. However, these reductions have come at a very high cost and substantially exceed any potential energy security benefits from reduced imports. EPRINC estimates that the full cost of the $0.45/gallon ethanol subsidy is closer to $0.90/gallon as the U.S. would consume ethanol at approximately half its current volume absent a mandate or blender’s credit. By this metric the real cost of the blender’s credit is $37.80 for every barrel of incrementally blended ethanol over a subsidy and mandate free base case. Adjusted for energy content, the blenders’ credit cost is $56.70 per barrel of gasoline equivalent – a premium of $1.35 for every gallon of gasoline offset by the RFS. Estimates by CBO (Congressional Budget Office) are in the same range.

Oak Ridge National Laboratory (ORNL) released a study in 2006 that estimated the cost to the U.S. economy of every barrel of imported oil. ORNL found that the cost of imported oil to the U.S. economy is $13.58/bbl (in 2004 $) in addition to the market price. This cost includes both a monopsony component, which is the estimated effect that the U.S has on world oil prices as the world’s largest consumer of crude oil, and a cost for macroeconomic disruptions to the U.S. economy. ORNL’s calculations do not include environmental or foreign policy costs. ORNL’s study has been used by the National Highway Transportation Safety Administration (NHTSA) to provide justification for increasing corporate average fuel economy (CAFE) standards and by the EPA to promote the National Renewable Fuel Standards Program (RFS2).

In 2009 dollars, the incremental benefit of reducing oil imports by one barrel is worth $14.70 using the conclusions from ORNL. As stated previously, EPRINC calculates that the entire RFS program is reducing petroleum imports by approximately 400,000 bbls/d. Based on the ORNL study results and this estimate, the benefits of the RFS program in 2011 are not likely more than $2.5 billion. These benefits must be compared to the direct and indirect costs of the program. The blender's credit alone costs the federal government over $6 billion per year. In addition to these costs are the costs of grants, loan guarantees, loss of efficiencies in refinery and retail operations, and rising corn prices. These additional requirements further extend the costs of the program, but even without a precise calculation of these costs, the loss of tax payer revenue far exceeds the benefits from the program by nearly 3 to 1 under the most conservative assumptions.

About the Energy Policy Research Foundation, Inc.:
EPRINC researches and publishes reports on all aspects of the petroleum industry which are made available free of charge to all interested organizations and individuals. It also provides analysis for quotation and background information to the media.

http://www.eprinc.org


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## hkskyline

*Food inflation in focus amid lofty crop price outlook*
Mon, Jul 25, 2011

CHICAGO (Reuters) - Grain prices will likely remain elevated at the end of this year, a Reuters poll showed, providing little relief to food prices while continuing to challenge policymakers battling to tamp down inflation.

Many analysts say the era of cheap food may well be over as rising crop production struggles to keep pace with soaring global demand, particularly from the mushrooming middle-class populations of developing nations such as China and India.

But experts do not expect a repeat of the late-year grain market rallies of 2010 which ignited record food inflation that stirred popular unrest in the Middle East and North Africa, toppling governments in Egypt and Tunisia.

The UN Food and Agriculture Organization's index of food prices hit a record peak in February, creating fears of a repeat of the 2007/08 global food crisis that prompted food riots and forced millions into hunger.

Governments have progressively taken steps to rein in soaring costs for staples that disproportionately impact the world's poor, including the systemic releases of state grain stocks in China and the construction of grain silos in India.

Much will hinge on weather in the U.S. Farm Belt this summer as near-perfect crop conditions are needed in the world's top grain exporter to soothe markets on edge over shrinking stockpiles of corn and soybeans and rapidly rising demand for food.

Debt problems in Europe and the United States will also play a role. If left unresolved, they could tip the world into another recession like the one that eroded grain prices beginning in late 2008.

CORN SEEN RISING

Prices of corn -- a cornerstone of the food chain that impacts the cost of meat, milk, and eggs -- are forecast to end 2011 at $6.89 per bushel, about 10 percent higher than a year earlier but short of June's all-time high of nearly $8.

At midmorning on Monday, spot corn futures on the Chicago Board of Trade were down about 2 percent at $6.75 a bushel.

Strong demand from livestock and ethanol producers and concern over crop yields in the United States, the world's largest producer and exporter, would lead to the third consecutive annual increase in corn prices.

"I generally look for relatively high prices come year's end with no major harvest correction," said PFG Best analyst Tim Hannagan, referring to corn.

"All end-users of grain such as ethanol producers, feeders, food processors and exporters will be aggressive buyers at harvest time to ensure they have their share of inventory as insurance for expected tight stocks and strong demand in 2012," Hannagan said.

Soybeans, which are crushed to produce soymeal, also a livestock feed, and soyoil used for cooking and to make biodiesel fuel, were seen at $13.92 a bushel at the end of the year, near 2010's lofty close of $13.94.

Soyoil prices themselves were seen rising about 3 percent year-on-year at 59.73 cents per lb, according to the average analyst forecast.

Spot CBOT soybeans fell at midmorning on Monday to $13.55 a bushel while soyoil slid to 55.45 cents per lb, both down nearly 2 percent.

The wild card for corn and soy prices may be China, the world's top soybean importer and an emerging importer of corn, as policymakers there walk the line between red-hot economic growth and soaring inflation.

"Both corn and soybeans have potential to go substantially higher if Chinese growth stays on track to provide firm demand. However, it may take time for that demand to develop, especially because China has shown the ability to be patient and buy only at lower price levels," said Bryce Knorr, senior editor of Farm Futures Magazine.

Wheat, a food staple grown in nearly every country around the world, was forecast to ease to $7.53 a bushel, down about 5 percent from the prior year as global stocks rebound following a severe drought last year in key exporter Russia and neighboring countries.

But experts warned that wheat's downside may be limited as cattle, hog and poultry producers around the world increasingly use it as an alternative feed grain instead of costly corn.

Spot CBOT wheat futures fell about 2.5 percent on Monday to $6.73 per bushel.


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## Ocean Railroader

I once went on a drop from Vriginia to the midwest and I only saw one ethonal only fuel pump on my 2000 mile trip and that was at where Interstate 65 meets US Route 30 around 60 miles from Chiacigo IL. I do own a flex fuel car which I think everyone should have in that you don't have to worry about it eating out your engines.

But the thing I have with it is that we have added our 7 billionith human on this planet and they say that Ethonal at the same time is going to eat up 30% to 50% of the US corn growing abilties which kind of does worry me. Now I would love for them to make ethonal out of pond scum in that you could make all the ethonal you need and would save the Chesapeak Bay by pumping in waste water from a Hog farm into a pond alga growing area which would work. But the fact that we are using food to make this stuff in a planet with 7 billion people does worry me a little.


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## hkskyline

^ That's a key cause for soaring food prices as producers try to satisfy both fuel and food needs.


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## hkskyline

*Livestock farmers say ethanol eats too much corn*
Associated Press
Nov 23, 2011

DES MOINES, Iowa (AP) — Livestock farmers are demanding a change in the nation's ethanol policy, claiming current rules could lead to spikes in meat prices and even shortages at supermarkets if corn growers have a bad year.

The amount of corn consumed by the ethanol industry combined with continued demand from overseas has cattle and hog farmers worried that if corn production drops due to drought or another natural disaster, the cost of feed could skyrocket, leaving them little choice but to reduce the size of their herds. A smaller supply could, in turn, mean higher meat prices and less selection at the grocery store.

The ethanol industry argues such scenarios are unlikely, but farmers have the backing of food manufacturers, who also fear that a federal mandate to increase production of ethanol will protect that industry from any kind of rationing amid a corn shortage.

The subject of debate is the Renewable Fuel Standard, a 2005 law requiring the nation to produce 7.5 billion gallons of renewable fuel by 2012. The standard was changed in 2007 to gradually increase the requirement to 36 billion gallons by 2022.

While a $5 billion-a-year federal ethanol subsidy is scheduled to expire this year, the production requirement will remain, unless it's changed by Congress.

That has other corn consumers worried that if production falls and rationing is needed, ethanol companies will be exempt. The U.S. Department of Agriculture recently reduced its estimate of this year's corn crop because of flooding in the Midwest and drought in the southern plains, and corn reserves are expected to fall to a 20-day supply next year. A 30-day supply is considered healthy.

At the same time, the price of corn for livestock feed has risen from an average of just over $3 a bushel in 2006-07 to an average of more than $6 this year.

"If we get a short crop, the ethanol industry does not participate in rationing and the brunt will fall on livestock and poultry," said Steve Meyer, president of Paragon Economics, a livestock and grain marketing and economic advisory company in Adel, Iowa.

A bill introduced last month by Rep. Bob Goodlatte, R-Va., would partially waive the ethanol goals when corn inventories are low.

The Grocery Manufacturers Association, which represents more than 300 food and beverage makers, also has endorsed the bill.

"We're behind livestock producers on this issue," said Geoff Moody, the association's director of energy and environmental policy. "We believe if there is a need to ration that ethanol will eat first because of the mandate."

About 5.9 billion bushels of corn were used for animal feed last year; 2.4 billion were exported; and about 4.9 billion were used for ethanol, up from about 630 million bushels in 2000, according to the National Corn Growers Association. About 1 billion bushels were eaten by humans in products such as cereal, sweeteners, and beverages.

U.S. corn farmers have steadily increased production over the years thanks to hybrid seeds and improved techniques, but Meyer said a 20 percent decline in the harvest would be enough to force corn rationing and lead to feed shortages. That would leave livestock farmers with little choice, he said.

"We can't shut down feeding," Meyer said. "The only way to do that is to kill the animals."

Even if there's no rationing, ethanol manufacturers generally have been better able to cope with high corn prices than livestock farmers because their business has bigger profit margins, said Darrel Good, an agricultural economist at the University of Illinois.

Randy Spronk, who raises corn and hogs in Edgerton, Minn., said farmers don't want to attack the ethanol industry but they want a plan in place if the corn supply should drop significantly.

"We really don't want to attack ethanol but wise people make plans," he said.

Matt Hartwig, chief of staff for the Renewable Fuels Association, called the effort to rewrite the fuel standard law "little more than a Trojan horse effort" to weaken or even eliminate it. He said the farmers' complaints were overblown and most livestock producers and meatpacking companies were making good profits.

Also, the ethanol industry now produces about 1 billion gallons of ethanol more than is required and if corn supplies fall short, it could cut back, he said.

The Environmental Protection Agency, which administers the fuel standard, said in a statement that states can already ask for a waiver "under certain circumstances, including inadequate domestic supply or harm to the economy or environment of a state."

Texas Gov. Rick Perry did this in 2008, claiming rising corn prices were hurting ranchers in his state. The EPA said it denied the request because the quota for renewable fuel wasn't causing severe economic harm to the state.

Meyer said many farmers are skeptical about a process that leaves such decisions to the EPA administrator, who "many in agriculture believe won't consider the best interest of livestock."

Good, the University of Illinois farm economist, said meat supplies could tighten if competing demands force corn prices higher. He said it boils down to a simple choice: "We're going to have to reduce our rate of increase in corn consumption or we're going to have to produce more corn."


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## Suburbanist

^^ They can import corn from elsewhere. Welcome to the world reality, where grains have more uses than livestock feeder!


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## kayanathera

Suburbanist said:


> ^^ They can import corn from elsewhere. Welcome to the world reality, where grains have more uses than livestock feeder!


because elsewhere there is the an abundance and they dont eat meat no?:nuts:you are one of the most retarded forum user that I have ever read:bash:


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## nomarandlee

> http://www.nytimes.com/2012/01/07/opinion/one-bad-energy-subsidy-expires.html?hpw
> 
> Editorial
> 
> *One Bad Energy Subsidy Expires
> *
> Published: January 6, 2012
> 
> 
> Now that the most polarized and paralyzed Congress in memory has managed to kill one of its most resilient boondoggles — the three-decade-old, multibillion-dollar subsidy for corn ethanol — we hope it has not exhausted its resolve and will take a hatchet to other harmful energy subsidies, chiefly those it gives to fossil fuels.
> 
> The ethanol subsidy was allowed to expire last Saturday, a death blow that was all the more remarkable coming just a few days before the Republican caucuses in the cornfields of Iowa, where the subsidy has long been seen as untouchable.
> 
> *The 45-cent-per-gallon tax credit for oil companies to blend ethanol into gasoline cost taxpayers $5 billion to $6 billion a year, deepening the budget deficit*. It boosted corn prices and increased food prices generally by encouraging farmers to replace other crops with corn. Its environmental virtues were less than advertised. Billed as a lower-carbon replacement for fossil fuels, corn ethanol generated more carbon dioxide than gasoline after taking into account the emissions caused when new land was cleared to replace the food lost to fuel production.
> 
> Several factors conspired to kill the tax break (as well as an exorbitant tariff on imports aimed at keeping cheaper Brazilian ethanol out). Conservatives did not like the subsidy’s price tag and liberals saw it as a form of corporate welfare. It was also unnecessary and redundant. Corn ethanol is now commercially viable without the subsidy and is further supported by a Congressional mandate requiring refiners to blend up to 15 billion gallons a year.
> 
> Congress should now focus on the oil industry, which has long enjoyed a web of arcane and unnecessary tax breaks — deductions for well depletion and intangible drilling costs. They are unique to the industry and, when combined with other subsidies, cost roughly $4 billion a year..........


...


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## hkskyline

*Ethanol Production in U.S. Falls 1.7%, Energy Department Says*
Bloomberg
By Mario Parker - Feb 8, 2012 11:42 PM GMT+0800

Ethanol production in the U.S. fell 1.7 percent to 923,000 barrels a day, the steepest decline since Jan. 6, according to the Energy Department.

Output was the lowest since Nov. 18 and has fallen in four out of the past five weeks, the department said in a report released today. Stockpiles jumped 2.3 percent to a record 21.1 million barrels.

Production of conventional gasoline blended with ethanol rose 1.7 percent to 4.9 million barrels a day, the report showed, the highest level since Dec. 23.

Denatured ethanol for March delivery advanced 2 cents, or 0.9 percent, to $2.231 a gallon at 10:37 a.m. New York time on the Chicago Board of Trade.


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## hkskyline

*Canada ethanol policy hurts livestock farmers: report*
Tue, Jan 31, 2012

WINNIPEG, Manitoba (Reuters) - Ethanol production has boosted the prices of grains that Canadian farmers buy to raise cattle and pigs, and Ottawa should curb or eliminate its support for the industry, an agriculture research organization said on Tuesday.

But a leading biofuels group said the report wildly overstated ethanol's impact on grain prices.

The report conducted by the George Morris Centre and paid for by livestock and meat groups said while many factors influence grain and livestock prices, Canadian ethanol production has boosted feed grains by C$15 to C$20 per ton in eastern Canada and C$5 to C$10 per ton in western Canada.

The result is added costs to livestock farmers amounting to C$130 million ($129.6 million) per year, the report said.

"Everybody says, 'Oh Canada doesn't set the global prices for grain, we're a small player'," said Kevin Grier, senior analyst at the George Morris Centre, based in Guelph, Ontario.

"The whole focus is to try and show that ... ethanol does have an impact. Canada's policies do matter (to grain prices)."

The George Morris Centre has previously published reports on ethanol's impact, but this is the first to quantify its effect on livestock farmers, Grier said.

Ethanol makes up a small portion of demand for corn and wheat and the report overstates its impact on prices, countered Tim Haig, interim president and chairman of the Canadian Renewable Fuels Association.

"Does it have zero impact? That would be naive. But it's minimal," Haig said. "We believe this (impact) is wildly overstated."

The Canadian and provincial governments spend about C$250 million annually, according to the centre, to subsidize ethanol production by companies such as Husky and Suncor, with the aim of cutting greenhouse gas emissions from conventional fuels.

Ottawa requires the gasoline pool to contain an average of 5 percent ethanol.


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## hkskyline

*Supply-demand crunch pinching ethanol industry*
Feb 13 12:10pm

SIOUX FALLS, S.D. (AP) — Falling fuel demand, an ethanol oversupply and high corn costs could lead some Midwest biorefineries to cut back or idle production until profit margins improve, industry analysts say.

Troy Gavin, general manager of the Midwest Renewable Energy ethanol plant near Sutherland, Neb., said the 28-million-gallon-per-year plant is halting production for a period of up to eight to 12 weeks because of the supply-demand imbalance.

"It's got to work itself out of the system, and it will," Gavin said Monday.

Ethanol futures on the Chicago Board of Trade have dropped nearly 50 cents over the past five months to $2.21 a gallon, and corn, the alternative fuel's primary feedstock, is hovering around $6.36 a bushel.

Meanwhile, ethanol stocks as of Feb. 3 climbed to an all-time weekly high of 21.1 million gallons, according to the Energy Information Association.

"We went from some of the best margins we've ever seen to some of the worst in 30 to 45 days," Gavin said. "That is volatility like no other industry."

Rick Kment, a Nebraska-based ethanol industry analyst for agricultural data company DTN, said much of the lackluster demand is seasonal.

Ethanol is blended into gasoline, so a driver pumping fewer gallons affects both industries. And fuel demand typically drops during the winter months between the holiday travel season and their spring-summer road trips.

Kment said larger ethanol plants will likely cut back on production rather than go cold, as a shutdown can be more disruptive.

"That way they can jump back into it when margins improve," he said.

Another contributing factor could be the Jan. 1 expiration of the 45-cents-per-gallon blender tax credit. Although it didn't go directly to ethanol producers, it had been an incentive for oil companies to buy ethanol and blend it with gasoline, said Matt Hartwig, spokesman for the Renewable Fuels Association.

"Part of that might be a little market adjustment with the tax credit going away," Hartwig said.

Last week, Archer Daniels Midland Co. announced it was closing its ethanol plant in the North Dakota city of Walhalla, ending 61 jobs. The company said the plant wasn't profitable enough because of its geographic location and scale.

Kment said ADM's announcement seemed to be more of a corporate strategic decision rather than one based on industry profit margins.

Volatility in 2008 led to the bankruptcy of VeraSun, then the nation's second largest ethanol producer.

As skyrocketing corn costs began cutting into ethanol producers' profits, many tried to control costs by hedging, which sets future prices for corn sellers while helping buyers avoid the risk of volatile price swings by letting them lock in at a set cost.

After VeraSun locked into prices for its feedstock, corn went into a sharp decline from almost $8 per bushel to less than $5 per bushel.

Gavin said the industry is now better equipped to handle volatility, as companies have reduced their debt and are a lot less exposed.

"The industry has become a lot more intelligent and has managed risk in a lot different fashion," Gavin said. "Risk management has become a daily occurrence."


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## hkskyline

*As Gasoline Sales Sag, E85 Sales Soar in Minnesota*

SAINT PAUL, Minn., Feb. 13, 2012 /PRNewswire-USNewswire/ -- While gasoline consumption in Minnesota dipped to its lowest point in a decade in 2011, sales of E85 fuel in Minnesota finished the year strong. Owners of flex fuel vehicles, which can use either ethanol-based E85 or regular unleaded, bought an estimated 19.8 million gallons of E85 in 2011, according to figures released by the Minnesota Department of Commerce. That would place 2011 as the 3rd best year for E85 sales, after the pre-recession records of 22.5 million gallons sold in 2008 and 21.4 million gallons sold in 2007. Minnesota drivers consumed 2.4 billion gallons of gasoline in 2011, down from 2.5 billion in 2010 and the state's 10-year peak of gasoline consumption, 2.6 million gallons, reached in 2004.

Sales of mid-level ethanol fuels were also up in 2011, with an estimated 2 million gallons sold at 71 flex fuel pumps (also known as blender pumps) statewide, up from the estimated 1.8 million gallons sold in 2010. Like E85, these mid-level blends should only be used in flex fuel vehicles designed to use high-ethanol fuels as well as gasoline.

Officials with the American Lung Association in Minnesota, which recognizes E85 as a clean air choice that can reduce tailpipe emissions, hailed the news.

"Minnesota is one of the few states that offer drivers easy access to a cleaner alternative to petroleum-based fuel," said Kelly Marczak, director of the Clean Air Choice program of the American Lung Association in Minnesota. "We have more retail E85 outlets than any other state, and there are nearly a quarter million flex fuel vehicles registered in Minnesota. Every time a flex fuel vehicle is filled with E85 instead of gasoline, it reduces air pollution, helps our local economy, and lessens our state's dependence on petroleum, which we import from other states or countries."

For more information on E85 and flex fuel vehicles or to find an E85 retailer nearby, see www.CleanAirChoice.org.

SOURCE American Lung Association in Minnesota


----------



## nomarandlee

> http://news.yahoo.com/blogs/
> 
> *Dutch researchers invent a process to turn plants into plastics*
> By Tecca
> 
> PostsBy Tecca | Today in Tech – 12 hrs ago
> 
> It should come as no surprise to learn that the world is over reliant on petroleum, from the gas we put in cars to the plastic bags we take groceries home in. We're still trying to figure out how to make electric cars popular, but scientists at Utrecht University in the Netherlands may have solved the plastic bag half of the problem, creating an innovative new process that turns plant material to plastic.
> 
> Being able to convert plants to plastic isn't new, but the ability to make the conversion cheaply and efficiently is. The new technology uses a new type of iron nanoparticle catalyst to synthesize ethylene and propylene, the basic components of most modern plastics, from plant material.
> 
> This means that just about everything we use with plastic in our daily lives, from cars to paint, could one day come from a 100% renewable source. And since the process uses waste products such as branches and grass clippings, this new method of making plastic doesn't need to compete with the food


..


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## hkskyline

Will the plastic be biodegradable?


----------



## maisonK

hkskyline said:


> Will the plastic be biodegradable?


I don't think so, but



> *Fungi Discovered In The Amazon Will Eat Your Plastic*
> 
> Polyurethane seemed like it couldn’t interact with the earth’s normal processes of breaking down and recycling material. That’s just because it hadn’t met the right mushroom yet.
> 
> The Amazon is home to more species that almost anywhere else on earth. One of them, carried home recently by a group of Yale University, appears to be quite happy eating plastic in airless landfills.


http://www.innovationtoronto.com/2012/01/fungi-discovered-in-the-amazon-will-eat-your-plastic/





> *How much gasoline does the United States consume?*
> 
> In 2010, the United States consumed about 137.76 billion gallons. This was about 3% less than the record high of 142.38 billion gallons (or 3.39 billion barrels) consumed in 2007.
> http://www.eia.gov/tools/faqs/faq.cfm?id=23&t=10





> *How much ethanol is produced, imported, and consumed in the U.S.?*
> 
> U.S. Fuel Ethanol Data Summary (Billions of Gallons)
> 
> Year Prod. Net Imports Consumption
> 2007 6.52 0.44 6.89
> 2008 9.31 0.53 9.68
> 2009 10.94 0.20 11.04
> 2010 13.29 -0.38 12.86
> 2011 11.51 -0.78 10.72
> http://www.eia.gov/tools/faqs/faq.cfm?id=90&t=4





> About 99% of the fuel ethanol consumed in the U.S. is added to gasoline in mixtures.
> Any gasoline powered engine in the U.S. can use E10 (gasoline with 10% ethanol), but only specific types of vehicles can use mixtures with greater than 10% ethanol. The U.S. Environmental Protection Agency ruled in October 2010, that E15 can be used in cars and light trucks (only) of model year 2007 and newer without causing damage to the engine and fuel system.
> Some States require use of E10. Minnesota, for example, requires almost all gasoline sold in the State to contain 10% ethanol.


US seem on a good track there .. what I don't get is what's with the E30 - E85 nonsense.


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## hkskyline

*Farmers Plan Biggest Crops Since 1984, Led by Corn: Commodities* 

Feb. 7 (Bloomberg) -- U.S. farmers will plant the most acres in a generation this year, led by the biggest corn crop since World War II, taking advantage of the highest agricultural prices in at least four decades.

They will sow corn, soybeans and wheat on 226.9 million acres, the most since 1984, a Bloomberg survey of 36 farmers, bankers and analysts showed. The 2.5 percent gain means an expansion the size of New Jersey, as growers target fields left fallow last year and land freed up from conservation programs.

Crop prices, some of which reached the highest averages ever in 2011, bolstered the economies of Midwest growing states, sent net farm income up 28 percent to $100.9 billion and pushed the value of farmland to a record $2,350 an acre, the U.S. Department of Agriculture estimates. Global food costs are down 11 percent from a peak a year ago as grain output rises from China to Canada, United Nations data show.

“There is unlikely to be any ground that won’t be planted this year,” said Todd Wachtel, a 40 year-old who farms about 5,700 acres in Altamont, Illinois, and plans to expand his corn fields by 21 percent when seeding begins in early April. “Farmers know that they have to plant more when prices are high because they may not last.”

Production Forecast

A bigger harvest in the U.S., the world’s largest exporter of all three crops, will help compensate for shortages in the current crop year. Drought damage in Brazil and Argentina will probably spur the USDA to cut its global and U.S. grain-supply forecasts for the current season on Feb. 9, a separate Bloomberg survey of as many as 25 analysts showed. The USDA’s first forecast for the year 2012-2013 crop year will be Feb. 23.

Farmers will sow corn, used to feed livestock and make ethanol, on 94.329 million acres this year, up 2.6 percent from last year and the most since 1944, according to the Bloomberg survey. Soybean fields may expand 0.4 percent to 75.309 million acres, the fifth-most ever. Both crops are harvested after the current season ends on Aug. 31. Wheat in the season that begins June 1 will reach a three-year high of 57.233 million acres, up 5.2 percent, the survey showed.

Corn may rise 7.4 percent to $6.90 a bushel in six months because of the damage in South America, before dropping to $5.25 in a year as U.S. farmers increase supply, Goldman Sachs Group Inc. said in a Feb. 2 report. Corn for delivery in December, after the harvest, fell 1 percent to $5.7525 today, 10 percent below the March contract on the Chicago Board of Trade.

Foresight Commodities

Wheat may tumble 17 percent to $5.50 by July and soybeans may drop 17 percent to $10.20 a bushel, analysts at commodity broker Allendale Inc. in McHenry, Illinois, said Jan. 21.

“The area is available to have huge crops this year,” said Paul Meyers, a vice president at Foresight Commodities Services Inc. in Long Valley, New Jersey, and the former head of grain-market analysis at the USDA from 1974 to 1983. “We are headed for a surplus-supply situation.”

Corn, soybean and wheat futures are down at least 15 percent since the end of August, helping to send the Standard & Poor’s GSCI Agriculture Index to a 17 percent decline. The MSCI All-Country World Index of equities gained 5 percent during the period, touching a six-month high today, while Treasuries returned 2.2 percent, a Bank of America Corp. index shows.

World food prices fell to a 14-month low in December, led by declines in grains, sugar and oilseeds, the UN’s Food and Agriculture Organization said Jan. 12.

Monetary Fund

The USDA affirmed its forecast for moderating food costs last month. Prices will increase 2.5 percent to 3.5 percent in 2012, below last year’s 3.7 percent gain, the agency said Jan. 25. The same day, the International Monetary Fund forecast a 14 percent drop in non-oil commodities this year, citing more supply.

Farmers in the Midwest, the main growing region, are less than two months away from planting seeds, and dry soils in some areas could limit output. The most widely-held option on December corn futures gives the holder the right to buy the grain at $7.

“It’s been an abnormally warm winter,” said Alan Tiemann, who is preparing to expand corn planting on his 2,000-acre farm in Seward, Nebraska, by 15 percent. “That may not relate to what’s going to happen this summer, but it keeps you on the edge of your seat a little bit, wondering when the next moisture event is going to happen.”

Corn averaged $6.79 in Chicago last year, the highest ever and twice the level of the previous decade, exchange data show. Soybeans averaged a record $13.21, 72 percent above the 10 previous years, while wheat’s average of $7.235 was the second- highest ever and 57 percent more than the past decade.

Trading Commission

Money managers have been betting on lower wheat prices since September, U.S. Commodity Futures Trading Commission data show. They cut their bullish wagers on soybean and corn in two of the past three weeks.

Floods, drought and freezes last year prevented planting of the three crops on about 8.577 million acres, 28 percent more than in 2010, USDA data show. An additional 1.84 million acres that were planted failed to produce, more than double the amount a year earlier.

Crop insurers paid out a record $9.1 billion last year to cover the damage, and the bill may top $10 billion when all claims are settled, Overland Park, Kansas-based National Crop Insurance Services said Jan. 24.

A return to normal weather in 2012 would mean more production from last year’s lost acres. The government also has reduced the amount of land it pays farmers to leave fallow by 4.7 percent, adding 1.47 million acres that weren’t available in 2011, USDA data show.

Rising incomes allowed farmers to buy more land and the extra seed, crop chemicals and equipment needed.

Profitable Industries

“Grain farming has been one of few profitable industries for the past three years, and there will be a tendency for farmers around the world to maximize acreage,” said Don Roose, the president of U.S. Commodities Inc. in West Des Moines, Iowa, who has been advising farmers and grain elevators since 1979. “We have the potential to grow record world crops this year that can swamp demand.”

Deere & Co., the world’s largest farm-equipment maker, will report record net income of $3.14 billion this year, up from $2.8 billion a year earlier, the mean of eight analyst estimates compiled by Bloomberg shows. Shares of the Moline, Illinois- based company rose 14 percent this year. Monsanto Co., the biggest seed company, will earn $1.9 billion, up from $1.61 billion, the mean of seven estimates shows. The St. Louis-based company rose 14 percent in New York trading this year.

Farming Accounts

Land prices in Iowa, the biggest corn- and soybean-growing state, averaged $5,600 an acre last year, three times the amount a decade ago, USDA data show.

While farming accounts for 0.9 percent of the U.S. economy, it has been among the fastest-growing contributors. The amount of value added by agriculture in the four years through 2010 rose 42 percent to $132.6 billion, compared with 8.6 percent growth for the entire economy, government data show.

U.S. exports surged as global economic growth boosted demand for crops, meat and dairy products, while weather damage disrupted supplies of everything from Russian wheat to Chinese pork.

Shipments reached a record $137.4 billion in the year that ended Sept. 30, with China the largest farm-goods buyer, USDA data show. While the government expects a drop to $132 billion in the current fiscal year, that still would be the second- largest ever and 21 percent higher than when President Barack Obama set a goal in 2010 to double all U.S. exports by 2015.

U.S. Unemployment

Unemployment in Midwest states was 7.9 percent in December, tied with the Northeast as the healthiest job region. North Dakota, Nebraska and South Dakota were the only states with unemployment under 5 percent. The national rate fell to 8.3 percent in January from 8.5 percent in December.

Corn will lead the planting surge because it is the most profitable row crop. U.S. mandates for alternative fuels have led to an increased use of the grain to make ethanol, and rising worldwide incomes are boosting meat consumption, increasing requirements for livestock feed. Global production of beef, veal, pork, chicken and turkey will reach almost a quarter of a billion metric tons this year, 62 percent more than two decades ago, the USDA estimates.

An acre of corn will earn as much $150 more than soybeans at current prices and normal weather, said Mike Wagler, 30, who farms about 7,000 acres with his father in Montgomery, Indiana.

“Farmers have the capital to plant a big corn crop this year,” said Wagler, who plans to sow 85 percent of his family’s land with the grain compared with 70 percent last year. “We can make more money raising corn than soybeans.”

North Dakota

In North Dakota, the largest producer of spring wheat, farmers probably will plant record corn and soybean acres this year as they use most of the 5.6 million acres that couldn’t be planted in 2011, said Frayne Olson, an agriculture economist at North Dakota State University in Fargo. Spring-wheat acreage will remain steady, he said.

David Kopseng, a fourth-generation grower on 4,700 acres in Harvey, North Dakota, said he will boost corn planting by 17 percent to 1,400 acres from a year earlier. in 2006, he didn’t sow any of the grain. Improved seeds have boosted yield by about 40 percent in the past decade, making corn at least $50 more profitable than wheat or soybeans, he said.

“We’re going to plant the most corn acres ever,” said the 47-year-old Kopseng. “I’ve been buying some more land and renting more because of corn’s profitability. It’s a great time to be a farmer in North Dakota.”


----------



## hkskyline

*S.Africa sees $258 mln ethanol plant by 2014*
Mon, Feb 20, 2012

CAPE TOWN (Reuters) - South Africa plans to invest 2 billion rand to build an ethanol plant and help a nascent biofuels sector that could reduce the country's reliance on imported fuel, an industry player said on Monday.

Africa's biggest economy imports about 60 percent of its crude oil needs and became a net importer of finished petroleum products several years ago.

In recent months, South Africa has been hit by fuel shortages due to planned and unplanned shutdowns at four of its six refineries.

Roak Crew, chief executive at Sugar Beet RSA, which is implementing the project in collaboration with the government, said the plant could start operating in 2014. It would initially produce some 90 million litres of fuel a year as sugar beet and grain sorghum are converted into ethanol.

Output at the plant to be located in the impoverished Eastern Cape province could eventually be raised to 200 million litres a year, he said, but concerns among refiners regarding fuel blending and feedstock could hamper development.

"At the moment there is no requirement by the fossil fuel producers to blend biofuels into their products, and without this happening, the industry will not be sustainable," Crew told Reuters.

The plant would provide a major boost to the development of South Africa's biofuels industry, which has been held back by an inadequate regulatory regime and concerns that biofuels would hurt food security and impact food prices.

The plant would be funded by the government, which has a target of having biofuels annually contribute 2 percent, around 400 million litres, to liquid fuels consumption by 2013.

Agriculture Minister Tina Joemat-Pettersson said the state wanted to ensure small-scale farmers are involved in sugar beet planting to boost farming in areas neglected during apartheid.

The construction of the plant is likely to start later this year, she said, adding that exports into Africa were an option.

"We have already done the pilot, so this now is beyond the pilot stage. We are quite confident that this is going to be a successful project," she said recently.

Canola, sunflower and soya are feedstock for biodiesel, while sugar cane and sugar beet are feedstock for ethanol.

South Africa's Illovo Sugar, a unit of Associated British Foods said it may opt to invest in biofuels from sugarcane if it made business sense.

The South African Petroleum Industry Association (SAPIA), which represents refiners including Royal Dutch Shell, BP, Chevron, Total and Sasol said the government needs to ensure that the push for biofuels does not compromise the availability of fuel supplies.

"The regulated pricing mechanism needs to be determined. What guarantees can be given that sufficient stocks of biofuels will be made available to provide for the mandatory blend requirements?" said head of SAPIA Avhapfani Tshifularo.

South Africa's Department of Energy plans to finalise the mandatory blending regulations by the end of this year.


----------



## Ocean Railroader

This is kind of sick that they are going to put a ethonal plant in this part of the world where they say tens of millions of people are straving do to high food prices. The only way I would suport something like this in this part of the world if it used a new idea such as pumping sewage water into alage tanks and have the alage make the ethonal.

There is another plant which if it could be tammed would be the greatest enothal plant of all time and that is duck weed that grows in canals and ponds and lake. The duck weed plant can grow at over a foot a day in many parts in the US it can basicly over a summer growing season take over a lake or a canal and block it to boats. It's very fast growing and I mean very fast growing and it can live in really crappy water. This would make a very good source for bio fuel instead of corn which takes a whole summer for one ear to grow and as of now humans don't eat duck weed but spend tens of millions of dollars a year trying to remove it from lakes and ponds.


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## hkskyline

*Shell, Iogen scrap plans for Canada biofuel plant*
Apr 30, 2012

(Reuters) - Royal Dutch Shell Plc and Iogen Corp have scrapped plans for a commercial-scale biofuel plant in Manitoba, spelling the loss of 150 jobs and raising questions about widespread and near-term use of fuel made from agricultural waste in Canada.

The Iogen Energy joint venture had been studying building a plant to make ethanol from straw and other plant waste, rather than from food crops such as corn and sugar. One location discussed was Portage la Prairie, west of Winnipeg, Manitoba.

The proposal had been in planning stages and a spokesman for Shell could not provide an estimated cost.

Shell first invested in Iogen 10 years ago and the partners have operated a demonstration plant in the Ottawa area since 2004.

"We do continue to have a relationship with them and continue to retain the licensing rights to the technology developed," Shell spokesman David Williams said on Monday.

"It's like a lot of things with R&D, you build demonstration plants, you get that far, and you learn from them, and this has been an important source of knowledge."

Iogen will still employ 110 people at its Ottawa headquarters and plans to expand new technology for production of the biofuels made from cellulose, the partners said.

Cellulosic ethanol is made from the non-food portion of crops. Ethanol production from food grains, especially corn, has generated debate about the ethics of diverting food for use in fuel and has been a key reason why U.S. corn stocks are projected to fall to a 16-year low this summer.

Chicago corn futures prices hit a record peak last summer and remain historically high.

The Canadian and provincial governments spend about C$250 million ($253 million) annually, according to the agriculture think-tank George Morris Centre, to subsidize production by companies such as Husky Energy Inc and Suncor Energy Inc. One aim is to cut greenhouse gas emissions from conventional fuel.

Ottawa wants gasoline across the country to contain an average of 5 percent ethanol, creating demand for 2 billion liters, but current production falls short of that level.

The decision by Shell and Iogen doesn't threaten the future Canadian biofuels production, said Scott Thurlow, president of the Canadian Renewable Fuels Association.

"It's just like any other fuel, it takes time to build up the necessary capital to implement," he said. "While I am personally disappointed, I don't see this decision as a threat to the industry in general."

Thurlow said there are demonstration projects in Canada for cellulosic ethanol, but no commercial production to his knowledge.

For its part, Shell is a partner with other ethanol producers, including Brazil's Cosan and a U.S. company called Virent, which has developed technology to convert plant sugars into hydrocarbon molecules.

($1=$0.99 Canadian)


----------



## hkskyline

*American Ethanol Launches Public Awareness Campaign Promoting the Benefits of U.S. Made Ethanol*

WASHINGTON, June 8, 2012 /PRNewswire-USNewswire/ -- NASCAR Official Partner American Ethanol announced a comprehensive campaign to further increase awareness among NASCAR fans about the benefits of American Ethanol.

The "American Ethanol Sweepstakes" includes a national promotion from June 8 through August 31, paid media with Turner Sports for NASCAR on TNT and NASCAR.com, race entitlement sponsorships at Iowa Speedway and Chicagoland Speedway, and experiential activation at select tracks and industry events. Additional elements of the campaign will be announced in the coming weeks.

"NASCAR is the perfect platform to dispel the myths about U.S. made ethanol," said Tom Buis, CEO of Growth Energy. "Not only are these fans among the most brand loyal in all of sports, but they also understand the importance of creating jobs here in America that cannot be outsourced, reducing our dependence on foreign oil and using a cleaner burning fuel to protect our environment -- all of which American Ethanol does.

"This campaign truly showcases that if American Ethanol meets the high expectations and rigorous demands of NASCAR, it will bring the same level of performance and benefits to your car," Buis added.

The campaign features Richard Childress Racing driver Austin Dillon, grandson of legendary NASCAR team owner Richard Childress. The 2011 NASCAR Camping World Truck Series driving champion and current NASCAR Nationwide Series championship contender stars in a 30-second national television commercial that highlights the benefits of U.S.-made ethanol. Fellow RCR driver Kevin Harvick also makes an appearance in the spot, which is scheduled to debut during the broadcast of the Pocono 400 NASCAR Sprint Cup Series race on TNT and is designed to drive fans to American Ethanol's Facebook page to enter for a chance to win one of three Chevy Silverado trucks and 500 additional prizes. By visiting Facebook.com/AmericanEthanol, NASCAR fans can learn more about American Ethanol. Additionally, Dillon will run an American Ethanol paint scheme in a RCR-prepared NASCAR Sprint Cup Series Chevrolet on June 17 at Michigan International Speedway, marking the 22-year-old driver's first Sprint Cup Series start of the 2012 season and the second of his career.

In addition, RCR driver Joey Coulter will carry the American Ethanol paint scheme on the No. 22 Chevrolet in the Camping World Truck Series at Iowa Speedway on July 14.

American Ethanol will serve as the event entitlement sponsor of the Camping World Truck Series races at Iowa Speedway on July 14 and September 15.

Chicagoland Speedway will host the American Ethanol 225 on Saturday, July 21. The brand will also activate heavily at Kentucky Speedway, Indianapolis Motor Speedway, Bristol Motor Speedway, and at key farm industry events across the Midwest.

About American Ethanol

Representing a wide array of ethanol supporters, from farmers to bio-engineering firms, American Ethanol was established by Growth Energy in partnership with the National Corn Growers Association and others. By establishing an Official Partnership with NASCAR starting with the 2011 racing season, the same year that NASCAR switched its fuel to Sunoco Green E15, American Ethanol aims to educate and inform the broader American public about the benefits of U.S.-made ethanol.

About NASCAR

The National Association for Stock Car Auto Racing, Inc. (NASCAR) is the sanctioning body for one of North America's premier sports. NASCAR races are broadcast in more than 150 countries and in 20 languages. In the U.S., races are broadcast on FOX, TNT, ABC/ESPN/ESPN2, SPEED and SiriusXM Satellite Radio. NASCAR fans are among the most brand loyal in all of sports, and as a result more Fortune 500 companies participate in NASCAR than any other sport. NASCAR consists of three national series (the NASCAR Sprint Cup Series, NASCAR Nationwide Series, and NASCAR Camping World Truck Series), four regional series, and one local grassroots series, as well as two international series. Also part of NASCAR is GRAND-AM Road Racing, known for its competition on road courses with multiple classes of cars. NASCAR sanctions more than 1,200 races at 100 tracks in more than 30 U.S. states, Canada and Mexico. Based in Daytona Beach, Fla., NASCAR has offices in eight cities across North America. The next NASCAR Sprint Cup Series race at Michigan International Speedway will be broadcast on June 17 at 1pm ET on TNT. For more information and a complete schedule, visit www.NASCAR.COM. Follow NASCAR on www.facebook.com/NASCAR or on Twitter: @NASCAR

About Richard Childress Racing

Richard Childress Racing (www.rcrracing.com) has earned more than 200 victories and 14 championships, including six in the NASCAR Sprint Cup Series with the legendary Dale Earnhardt. RCR was the first organization to win championships in the Sprint Cup Series, Nationwide Series and Camping World Truck Series. Its current Sprint Cup Series lineup includes Paul Menard (No. 27 Menards Chevrolet), Kevin Harvick (No. 29 Budweiser/Rheem/Jimmy John's Chevrolet) and Jeff Burton (No. 31 Caterpillar/Wheaties/BB&T Chevrolet). Its Nationwide Series program includes Elliott Sadler (No. 2 One Main Financial Chevrolet), 2011 Camping World Truck Series champion Austin Dillon (No. 3 Advocare/American Ethanol/Bass Pro Shops Chevrolet) and Harvick/Brendan Gaughan/Menard/Max Papis/Ty Dillon (No. 33 South Point Hotel & Casino/Menards/Hunt Brothers Pizza/Armour/Fast Fixin'/ Chevrolet). Tim George Jr./Harvick/Gaughan (No. 2 Potomac Family Dining Group/South Point Hotel & Casino/Kroger/Tide Chevrolet), Joey Coulter (No. 22 RCR/Steak-umm/Husky Liners Chevrolet) and 2011 ARCA Racing Series champion Ty Dillon (No.3 Bass Pro Shops Chevrolet) compete in the 2012 Camping World Truck Series season.

SOURCE American Ethanol


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## hkskyline

*Should the U.S. End the Ethanol Mandate?*
Detractors say it’s bad for both consumers and the environment. Supporters say it’s needed for the continued development of alternative fuels.
Wall Street Journal _Excerpt_
Nov. 15, 2015

The Renewable Fuel Standard, otherwise known as the ethanol mandate, requires refiners to blend an increasing amount of biofuels into the U.S. gasoline supply each year.

Created in 2005, the standard was meant to help reduce carbon emissions as well as U.S. dependence on foreign oil. But critics question how much it has helped on either score. Some say corn ethanol, the fuel most commonly blended with gasoline under the standard, actually worsens pollution. Others say the domestic oil boom has done far more to wean the nation off foreign oil.

In May, the Environmental Protection Agency proposed scaling back the volume targets for renewable fuels under the mandate, in part because advances in fuel efficiency mean drivers are using less gas than the law envisioned. The agency also cited limited availability of renewable fuels made from products other than corn.

The proposal drew criticism from environmentalists, as well as the ethanol and corn industries, who argued it was a step back from the law’s purpose.

More : http://www.wsj.com/articles/should-the-u-s-end-the-ethanol-mandate-1447643514


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## you477

The MOST PRATICAL WAY for US Gov't to reduce oil dependence is to put more resources on the public transportation instead of private transportation!


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## hkskyline

*Big Oil Companies Reap Windfall From Ethanol Rules*
Some refiners stand to rake in $1 billion by selling fuel credits, while others must spend millions to comply
The Wall Street Journal _Excerpt_
Oct. 27, 2016

Environmental regulations designed to boost the amount of ethanol blended into the U.S. gasoline supply have inadvertently become a multibillion-dollar windfall for some of the world’s biggest oil companies.

Companies including Chevron Corp., Royal Dutch Shell PLC, and BP PLC could reap a total of more than $1 billion this year by selling the renewable fuel credits associated with the ethanol program, according to an analysis commissioned by CVR Energy, a refinery operator controlled by billionaire Carl Icahn, a vocal critic of the rules.

For other companies, especially smaller refiners, the rules have had the opposite effect, forcing them to spend hundreds of millions to buy credits to comply.

Some large oil companies acknowledge they are reaping revenue from the regulations, but say their advantage stems from large investments they made to comply with it, and stress that not all of the money translates into profit.

“Because a few other companies made different business decisions and are now living with the consequences is not a reason to suddenly change the rules,” said Geoff Morrell, a senior vice president for BP.

The regulations “are complex and cannot be simplified by only accounting for a company’s ability to blend ethanol,” Chevron spokesman Braden Reddall said. A Shell spokesman declined to comment. A spokesman for Citgo, the U.S. arm of state-owned Petróleos de Venezuela SA, disputed it was profiting from the credits as the analysis claims, saying that it buys more than it sells annually to comply with its obligations.

The ethanol and biodiesel program, created during President George W. Bush’s administration, was aimed in part at reducing U.S. dependence on foreign oil. But those concerns have waned as a result of the abundant new U.S. oil and gas supplies unlocked by shale drilling. The rules require refiners to either blend ethanol with the gasoline they produce or buy credits.

Valero Energy Corp. disclosed when it reported third-quarter earnings Tuesday that it incurred $198 million in costs to meet biofuel blending rules during the period. It has said it will have to shell out as much as $850 million this year for the credits. PBF Energy Inc. has estimated costs will reach $300 million.

The top 10 U.S. refiners spent $1.1 billion on biofuel credits in the first half of this year, according to Moody’s Investors Service. Some refiners have warned they could be forced to conduct mass layoffs, or file for bankuptcy, because of the soaring costs of compliance.

“The consumer is paying more and it’s ending up in the pockets of retailers, major oil companies or speculators,” said George Damiris, the chief executive of HollyFrontier Corp., a Midwestern refiner. “Over time, if this goes uncorrected, people will basically be put out of business.”

The price of the credits has skyrocketed this year, amid complaints from fuel suppliers that they are being forced by the Environmental Protection Agency to blend more ethanol than consumers or car makers are willing to accept.

The EPA has raised the required ethanol amount to 10.5% of total fuel as required by legislation. But auto makers argue that anything above 10% is potentially damaging to some engines, and consumers have been slow to embrace the more ethanol-heavy blends.


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## skyridgeline

What most people don't realize is that the EPA uses gas with 0% ethanol to compute fuel economy.


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## hkskyline

Bloomberg _Excerpt_
*Renewable Fuel Standard ‘Solid‘ in Trump Era, Vilsack Says*
November 20, 2016 

The politically contentious Renewable Fuel Standard will survive a Donald Trump administration because ethanol is too well-established in rural areas to be dismantled, Agriculture Secretary Tom Vilsack said. 

"There’s going to be a lot of saber-rattling, but it supports too many jobs and too much rural infrastructure is set up for it," Vilsack said in a Nov. 18 interview that also covered subjects such as trade and immigration. "The Renewable Fuel Standard is solid."

The U.S. Environmental Protection Agency is due to decide whether to raise its targets for national biofuels consumption from 14.5 billion gallons in 2016, bringing it more in line with the 15 billion-gallon mandate envisioned in energy legislation passed in 2007. Ethanol has been criticized for raising food and feed costs, but has been a boon for corn-growers and domestic jobs.

President-elect Trump told the Iowa Renewable Fuels Association earlier in 2016 that the U.S. should increase ethanol mandates, but in September his campaign published a fact sheet calling for removal of the biofuel blending credit system. His campaign later reissued the fact sheet without the language opposing the system. Vilsack, speaking in his U.S. Department of Agriculture office in Washington, said rural support for the rest of the RFS would be enough to withstand attacks on it from other quarters. "I think it will be very difficult for it to be repealed," he said.

U.S. ethanol production has more than doubled since 2007, when the current form of the law was enacted, U.S. Energy Department data show.


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## hkskyline

Mar 24, 2017 
*U.S. oil refiners push for biofuels overhaul at White House*
Reuters _Excerpt_

U.S. oil refining executives met with a senior official in President Donald Trump's administration at the White House last week to argue their position for an overhaul of the nation's biofuels program, two people in the meeting told Reuters.

While it is not unusual for the White House to meet with stakeholders on key issues, the meeting is a sign the Trump administration is actively considering possible changes to the wide-reaching program.

Executives from Valero Energy Corp, Delta Airlines' refiner Monroe Energy, CVR Energy Inc. and several others met with Michael Catanzaro, Trump's senior energy policy aide, on March 16, the two attendees said.

The executives argued that Trump should change the Renewable Fuel Standard (RFS) program to lift the onus of blending biofuels into gasoline away from refiners, placing it instead further down the supply chain to gasoline marketers. They said the program was costing the oil refining industry money and jobs.

"The policy needs to adapt to a changing market," said Roy Houseman, a legislative representative for the United Steelworkers union, who was in the meeting. "We wanted to highlight the larger issue: We represent 30,000 workers in the refining industry."

It was not clear who initiated the meeting.

More : http://www.reuters.com/article/us-usa-biofuels-trump-idUSKBN16V2TQ


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## hkskyline

*Vomitoxin makes nasty appearance for U.S. farm sector *
Apr. 22, 2017
Reuters _Excerpt_

A fungus that causes “vomitoxin” has been found in some U.S. corn harvested last year, forcing poultry and pork farmers to test their grain, and giving headaches to grain growers already wrestling with massive supplies and low prices.

The plant toxin sickens livestock and can also make humans and pets fall ill.

The appearance of vomitoxin and other toxins produced by fungi is affecting ethanol markets and prompting grain processors to seek alternative sources of feed supplies.

Researchers at the U.S. Department of Agriculture first isolated the toxin in 1973 after an unusually wet winter in the Midwest. The compound was given what researchers described as the “trivial name” vomitoxin because pigs were refusing to eat the infected corn or vomiting after consuming it. The U.S. Corn Belt had earlier outbreaks of infection from the toxin in 1966 and 1928.

A vessel carrying a shipment of corn from Paraguay is due next month at a North Carolina port used by Smithfield Foods Inc [SFII.UL] (0288.HK), the world's largest pork producer.

The spread of vomitoxin is concentrated in Indiana, Wisconsin, Ohio, and parts of Iowa and Michigan, and its full impact is not yet known, according to state officials and data gathered by food testing firm Neogen Corp. (NEOG.O)

More : http://www.reuters.com/article/us-usa-corn-toxins-exclusive-idUSKBN17N2M5


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## hkskyline

*Ethanol proponents urge Canada to raise renewable-fuel levels for gasoline*
The Washington Times _Excerpt_
Monday, May 8, 2017

Faced with an uncertain future in the U.S., ethanol proponents have mounted a public push north of the border, urging Canada to raise its own renewable-fuel levels for gasoline.

Environment and Climate Change Canada, the nation’s top environmental agency, is in the process of developing a new “Clean Fuel Standard,” a broad set of new regulations aimed at reducing carbon emissions and bringing cleaner-burning fuels to the pump. Part of the review includes taking a second look at the country’s renewable-fuels rule, which currently calls for an average of 5 percent ethanol by volume in gasoline.

By comparison, U.S. gasoline this year topped 10 percent ethanol on average for the first time.

American ethanol producers — which already have found Canada to be fertile ground for exports — say the Canadian government, if it’s serious about reducing carbon emissions, ought to seriously consider raising that 5 percent threshold to at least 10 percent.

More : http://www.washingtontimes.com/news/2017/may/8/ethanol-proponents-urge-canada-to-raise-renewable-/


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## Jeff Farmer

I think these are good updates on ethanol.

Towing Arlington VA


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## hkskyline

Sept. 25, 2017
*Can The Corn Ethanol Lobby Win In Mexico, Too?*
Forbes _Excerpt_

Despite decidedly mixed scientific research on whether its product helps or harms the environment, the lobby for the use of corn-based ethanol in the United States has been extremely successful in acquiring and perpetuating mandates and subsidies for the use of its product in motor fuels for many years now. This is in spite of the reality that using corn for fuel distorts both fuel and agricultural markets and raises prices on all manner of grocery items, not to mention a growing body of science that indicates the product does little, if anything, positive for the environment, as well as concerns by automakers that the product reduces gas mileage and harms high-compression engines.

The elimination in the U.S. of the use of MTBE as a gasoline oxygenation agent by the EPA was a big factor in the initial turn to ethanol, but the existence of the Iowa Caucuses as the first step in the presidential nomination process every four years has served as a huge enabler of its preservation. Every election cycle, with few exceptions, presidential candidates who wish to become the nominee of their party feel the need to go to Iowa and promise with all their hearts to perpetuate subsidies for corn farmers and EPA mandates for the use of ethanol. Whether or not they know anything about the impacts of the policy at the time they make the promise, this knee-jerk posturing by presidential candidates ensures support by their administrations should they ultimately become president.

Without the ongoing positioning of the Iowa caucuses as the first presidential test, it would be difficult for the ethanol lobby to maintain its policy preferences. The justifications for the continuance of these subsidies and mandates are so flimsy that they likely would not be able to withstand the election of a president who opposed them.


Not satisfied with maintaining its mandates in U.S. fuel markets alone, the ethanol lobby has gone global, most notably through recent efforts in Mexico. Taking advantage of major changes to the country’s energy policies, the U.S. corn ethanol gang has been pushing to implement a 10% content mandate in Mexico, too. Thus far, the efforts have been negative-to-mixed, but the debate is not settled.

When Mexico City was declared the world's most polluted city in by the World Health Organization in 1993, the Mexican government moved quickly to introduce oxygenates into the country's gasoline. Mexico's new fuel standards and other regulatory actions were an immediate and dramatic success, helping to produce significant reductions in carbon monoxide, particulates and ozone levels over the next several years. While Mexico's standards allowed the use of up to 5.8% ethanol (E-6) in gasoline, there was no mandate for its use, and it was never utilized. The country's impressive results in cleaning up its air quality were achieved largely through the use of MTBE.

When the Mexican government began to enact its recent energy reforms, the corn ethanol lobby jumped in, pushing the country's energy regulatory commission (CRE) hard for implementation of an E-10 mandate. 

More : https://www.forbes.com/sites/davidb...ethanol-lobby-win-in-mexico-too/#7fe4d04b24de


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## hkskyline

Oct. 20, 2017
*U.S. House members ask EPA not to lower biofuels requirements*
_Excerpt_

NEW YORK (Reuters) - A group of 22 members of the U.S. House of Representatives asked the Environmental Protection Agency in a letter on Thursday not to lower some requirements for mixing biofuels into the country’s fuel supply, but also not to let ethanol exports qualify for renewable fuel credits, according to a copy of the letter obtained by Reuters.

The members of Congress are part of a bipartisan voting bloc dedicated to supporting the biofuels industry called the House Biofuels Caucus. They represent districts in states such as Iowa and Illinois where farmers grow corn for ethanol and other biofuels. They urged the agency to increase biomass-based biodiesel requirements and not to decrease the amount of advanced biofuels required to be added to the fuel supply.

“Our farmers and biofuels producers need greater certainty from the EPA,” the letter said, adding recent proposals the agency said it was considering “create unnecessary angst.”

“We will respond to the House Biofuels Caucus through the proper channel,” said EPA spokesman Jahan Wilcox in an email to Reuters.

Midwestern politicians and industry representatives have been pressuring the EPA not to reduce renewable fuel standards.

Fuel companies, meanwhile, want to change certain rules for complying with the standards to make it easier and cheaper for them to meet their renewable fuel requirements. They want ethanol exports to count as tradable credits toward their renewable fuel requirements, a proposal the Biofuels Caucus members condemned.

More : http://www.reuters.com/article/us-u...-to-lower-biofuels-requirements-idUSKBN1CO2G8


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## hkskyline

Nov 16, 2017
_Excerpt_
*U.S. biofuels policy contributes to global warming: study*

(Reuters) - U.S. renewable fuel mandates are contributing to global warming, boosting carbon emissions as farmers turn carbon-rich areas like wetlands and forests into cropland to grow corn, soy and wheat for biofuels production, a study presented on Wednesday said.

Three scientists from the University of Wisconsin presented their findings in Fort Worth, Texas, at a conference hosted by the National Wildlife Federation, an environmental group that opposes U.S. biofuels mandates in their current form.

The scientists said it could take 50 years for biofuels to reduce carbon emissions as they were designed to do, since any reduction stemming from blending them into petroleum products is offset by more carbon emissions from clearing new farmland.

Lead author Seth Spawn said the study showed the mandate had “far-reaching impacts on the climate through its effects on the land and the carbon that is stores,” according to a National Wildlife Federation press release.

A biofuels trade group quickly questioned the research methods used in the study, further fueling the heated debate over U.S. biofuels policy, which requires refiners to add renewable fuels like ethanol to their products.

Elected U.S. officials from farm country, including Senators Chuck Grassley and Joni Ernst of Iowa, want the Environmental Protection Agency to set annual mandates for fuel producers that maintain or raise the levels of biofuels they must blend into fuel. Officials from oil-rich states, including U.S. Senator Ted Cruz of Texas, want EPA to change biofuels laws to reduce the burden on fuel producers.

Geoff Cooper, executive vice president of the biofuels trade group the Renewable Fuel Association, said past studies similar to the one released on Wednesday “have been thoroughly debunked and disputed.”

“The authors continue to abuse and misrepresent unreliable satellite data, and they continue to present highly uncertain modeling results as if they were the gospel truth,” Cooper said.

Ernst was among a bipartisan group of Midwestern senators who briefly put a hold on an EPA nominee’s confirmation proceedings until U.S. President Donald Trump agreed to maintain current biofuels policy. Cruz now has a hold on a U.S. Department of Agriculture nominee and is seeking a meeting between the two sides, according to a letter he sent to Iowa Governor Kim Reynolds on Tuesday.

On Nov. 2, 64 members of the U.S. House of Representatives wrote to the EPA urging “well-rounded” biofuel policies.


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## hkskyline

Jan 11, 2018
*Grain glut leaves U.S. farmers facing losses from specialty corn*
_Excerpt_

CHICAGO (Reuters) - U.S. farmers who sought to boost revenues by planting corn used to make tortillas may be forced to sell their crops at a loss to makers of ethanol or animal feed because of a glut of what typically is a human food-grade product.

Oversupply of the most common grains such as corn and soybeans has spread to niche markets because so many farmers have switched to planting different strains of seed to diversify and bolster returns after four years of bumper crops cut farm income and pushed down prices for staple grains.

White corn, which makes up roughly 1 percent of the 14.6 billion-bushel U.S. corn harvest, can command a premium of as much as $1 per bushel over the commoditized yellow strain. But premiums have shriveled to four-year lows - to as little as 5 cents above Chicago Board of Trade corn futures Cc1.

Too many farmers planted white corn in states such as Illinois, Illinois, Kentucky and Nebraska. Corn prices in 2017 declined for the fifth straight year and record-large U.S. stocks pushed growers to look for potentially higher-value alternatives.

However, as acres devoted to varieties such as white corn, organic and non-genetically modified corn continue to rise, the benefits have shrunk for farmers switching to such strains.

White corn is used by companies such as the PepsiCo Inc (PEP.O) unit Frito-Lay to make corn chips, and by tortilla and chip makers including Chicago-based Azteca Foods. In South Africa, it is eaten as part of the breakfast staple pap and in Colombia and Venezuela in patties known as arepas.

Randy Anderson, who has planted white corn for 10 straight years in southern Illinois, said the market has become crowded. Local elevators, such as a Bunge Ltd (BG.N) facility that loads grain barges on the Ohio River, are buying white corn at prices that are below his cost of production.

“I feel like there could be a better bid in the near future,” Anderson said, adding that he was holding out for another 20 cents per bushel to bring him closer to eking out a profit.

Premiums for white corn in the United States surged in 2015 and 2016 because of a drought-reduced South African harvest that led to increased U.S. exports and more demand from Mexico, which also shipped white corn to South Africa.

But with supplies in South Africa once again abundant following a record-large corn harvest, there is more global supply than demand.


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## hkskyline

*The New War Over Ethanol, And How It Might Affect You*
Forbes _Excerpt_
April 23, 2018

A seemingly small action from the Environmental Protection Agency could spark a new war between Big Oil and Big Ag that could have far-reaching effects on the U.S. agricultural, energy, and transportation industries.

Last month the EPA granted an exemption to one of the largest refiners in the United States, allowing Andeavor (NYSE: ANDV), formerly Tesoro TSO +0%, to no longer comply with U.S. biofuels regulations.

The EPA exemption will allow three of Andeavor’s smallest refineries to ignore the mandates of the U.S. Renewable Fuel Standard (RFS). The RFS, authorized by the Energy Policy Act of 2005, requires refiners to blend renewable fuels such as ethanol into domestic gasoline. By issuing exemptions, the EPA is authorizing refineries to produce gasoline without these renewable feedstocks.

The Andeavor exemption is the latest in recent moves by the EPA to exempt 25 small refineries (those processing less than 75,000 barrels per day).

By one estimate, the exemptions could result in a drop in ethanol demand of one billion gallons per year.

Consider how the exemption might result in wide-reaching effects for the economy:

Ethanol is produced from corn in the U.S. and, while subject to debate on the efficacy of using corn to deliver a clean and affordable transportation fuel, ethanol remains a significant market opportunity for farmers.

More : https://www.forbes.com/sites/ftoddd...nol-and-how-it-might-affect-you/#3613db6f30c5


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## hkskyline

June 6, 2018
*Trump's move to please farmers on biofuels reform draws refinery union ire*
_Excerpt_

(Reuters) - U.S. President Donald Trump, in yielding to pressure from farming states and agreeing to suspend changes to U.S. biofuel policy is now being criticized by another important constituency, the main union for oil refinery workers.

The United Steelworkers, the largest industrial union in North America representing refinery workers, said the decision leaves in place a costly regulation that puts at risk thousands of blue collar jobs of the type Trump has promised to preserve.

“Inaction by the Trump administration now threatens the livelihood of thousands of East Coast refinery workers and tens of thousands of related jobs throughout the Northeast,” the union said in a statement on Wednesday.

Trump on Tuesday had told Midwestern lawmakers he would drop a proposed deal to tweak the U.S. Renewable Fuel Standard (RFS) to cut costs to refineries, saying he understood the move would hurt farmers, sources familiar with the matter told Reuters.

U.S. Senators Chuck Grassley and Joni Ernst from the farm state of Iowa, along with biofuels industry representatives in favor of the existing legislation praised Trump, and prices for U.S. renewable fuel credits soared more than 40 percent in morning trade.

“With no official decision, there is more to come on this,” said Brendan Williams, a lobbyist with merchant refiner PBF Energy Inc (PBF.N).

Merchant refiners would not stop looking for help, Williams said.

The White House was poised to announce proposed changes this week after hosting months of difficult negotiations between representatives of Big Oil and Big Corn. The deal would have eased pressure on the refining industry by allowing biofuels exports to count toward the annual volumes quotas, but would also have expanded sales of high-ethanol gasoline in a concession to biofuels producers.

More : https://www.reuters.com/article/us-...reform-draws-refinery-union-ire-idUSKCN1J21XU


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## Heusdens

hkth said:


> The MOST PRATICAL WAY for US Gov't to reduce oil dependence is to put more resources on the public transportation instead of private transportation! :speech:


The US used to have good transportation (train and bus services).

However it was intentionally broken down to favour the oil and automobile industry,

This has significantly changed the US and caused the phenomena of suburbia and low population density in such areas.

The backdrop of that is that public transportation would become much less beneficial since then population is spread out over a larger area. And it is very difficult to create new railways due to highcosts of land reclamation.

The only way would be to go underground.

I think that also motivated Elon Musk to start the boring company, since there is really not much alternative.


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## hkskyline

It's also an urban planning problem. They don't plan cities or suburbs to sustain public transport. So everyone drives.


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## SutroTower

The car culture is so ingrained on Americans, that even if public transportation suddenly was available in the suburbs people would still drive. People like to drive and that's fine, but if we want to make a parading shift and make people like to bike, walk etc then zoning should be rethought. With every new suburban housing block that sprawls they should facilitate retail space inside for things like a mom and pop grocery stores, etc. That'd help people stop using their cars for stupid reasons like driving 3 or more miles away to the Walmart for beers or a gallon of milk.


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## hkskyline

Sep 20, 2018
*EPA details broad expansion of biofuel waiver program*
_Excerpt_

NEW YORK (Reuters) - The U.S. Environmental Protection Agency (EPA) published new data detailing how it drastically expanded a biofuels waiver program for oil refiners since President Donald Trump’s administration took office, responding to pressure from the corn lobby to boost transparency over the opaque program.

The details published on the EPA’s website on Thursday showed the agency issued exemptions for 29 small refineries for 2017, freeing them from their requirement under the Renewable Fuel Standard to blend biofuels into gasoline and diesel, according to agency data released on Thursday.

That was up from 19 waivers granted for 2016 and 7 in 2015, the EPA said.

The data provides the most complete picture of the EPA’s expansion of the controversial small refinery waiver program to date. The waivers save the oil industry money, but biofuels groups worry they also cut into the nation’s demand for ethanol and other biofuels, and have criticized Trump’s EPA for over using the exemptions.

“Increasing transparency will improve implementation of the RFS and provide stakeholders and the regulated community the certainty and clarity they need to make important business and compliance decisions,” EPA Acting Administrator Andrew Wheeler said in a statement.

The data showed that the number of gallons exempted from the RFS under the 29 waivers granted in 2017 amounted to 13.62 billion, nearly double the 7.8 billion exempted in 2016.

More : https://www.reuters.com/article/us-...nsion-of-biofuel-waiver-program-idUSKCN1M02IO


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## hkskyline

Oct 30, 2018
*Brazil's Bolsonaro backs ethanol industry, pledges partnership*
_Excerpt_

SAO PAULO (Reuters) - President-elect Jair Bolsonaro backed Brazil’s ethanol industry and pledged to be a partner of the biofuel sector, according to remarks aired on Monday during an international sugar conference in Sao Paulo.

Right-wing Bolsonaro, who beat leftist Fernando Haddad in a run-off vote on Sunday, said in a video that he would like to see Brazil retake global leadership in ethanol production, which it lost to the United States some years ago.

“In the past, we were leaders on this front and we will once again lead, certainly,” he said in the video presented by congressman Evandro Gussi, who authored the bill passed in Congress this year that implements Brazil’s new policy to boost consumption of renewable fuels called RenovaBio.

This industry “is very important. It reduces carbon emissions, and from something that is ours, gives energy to Brazil. You can count on us, we are partners on this issue,” Bolsonaro said.

Gussi said he recorded the video some days ago, before the run-off vote.

The RenovaBio program is seen by many in Brazil’s sugar and ethanol industry as a lifeline to mills that are in a difficult financial situation after several years of low prices for the biofuel and the sweetener.

The new policy, which has yet to be fully regulated by the federal government that will take power on Jan. 1, gives fuel distributors growing targets for annual traded volumes of biofuels such as ethanol and biodiesel.

There were doubts in the ethanol industry if Bolsonaro, who at one point threatened to pull out of the Paris climate treaty, would back the policy and go ahead with its implementation.


----------



## hkskyline

Nov 10, 2018
*U.S. ethanol producers feeling the pinch from Trump trade war*
_Excerpt_

NEW YORK/CHICAGO (Reuters) - U.S. ethanol producers drew a bleak picture of their industry in quarterly filings and analyst calls this week, detailing how the critical farm belt business has been devastated by President Donald Trump’s trade war with China and biofuels management policies that they say have tilted toward oil refiners.

The ethanol business had grown for years at breakneck speed but its outlook has dimmed due to Washington’s aggressive protectionist stance and the administration’s unpredictable management of its renewable fuel program.

No. 4 U.S. ethanol producer Green Plains Inc reported a net loss of $12.5 million in the third quarter. The company has idled plants to trim soaring inventories and boost margins, it said Thursday. The company recently sold three plants and a vinegar business to help pay down debt. CEO Todd Becker and others noted that China had been expected to import 200 million gallons of ethanol this year but has instead been out of the market for months due to Trump’s trade war. Becker said Chinese buying would wipe out the U.S. supply glut, which he estimated at about 120 million gallons.

Archer Daniels Midland Co and Pacific Ethanol Inc, other big producers, also reported problems related to the trade fight.

As recently as February, China was the No. 2 global market for U.S. ethanol, which consumes about a third of the domestic corn crop. Then Beijing boosted import tariffs on several high-value American agricultural goods including ethanol, soybeans and pork, pressuring prices for each.

U.S. ethanol futures of $1.26 per gallon are near the lowest in more than a decade. Current stockpiles of 23.150 million barrels (972.3 million gallons) are just below a record from earlier this year, according to the U.S. Energy Information Administration.

The ethanol industry “is in a negative margin position. I wouldn’t say there are many plants that would be positive, even our best plants,” Becker said.

Pacific Ethanol, the No. 6 U.S. ethanol producer, told investors last week that it idled 10 percent of its production capacity to battle high inventories and slumping margins. Its shares have sunk to less than $2 each.

More : https://www.reuters.com/article/us-...-the-pinch-from-trump-trade-war-idUSKCN1NE2GH


----------



## hkskyline

Dec 18, 2018
*U.S. ethanol producers seek pricing reform as markets plunge, ADM sells*
_Excerpt_

NEW YORK/CHICAGO (Reuters) - U.S. ethanol producers stung by collapsing prices are seeking changes to the way benchmark values for the biofuel are established, arguing the current system used by exchanges is vulnerable to manipulation, according to sources.

The push comes as the key farm belt industry struggles with weak demand growth, a loss of export markets due to the U.S. trade war with China, and aggressive selling by global commodities giant Archer Daniels Midland Co (ADM.N) that have pushed ethanol prices to 13-year lows.

ADM is better placed to survive a long stretch of low prices than its ethanol-focused U.S. rivals, many of whom are concerned the company is deliberately pressuring the biofuel market lower to drive them out of business and are keen for a stable hedging tool to defend against further dips.

Top U.S. ethanol producer POET LLC has asked the CME Group (CME.O) to change its pricing method for a key swap contract used by the industry to hedge, and the rival ICE exchange is contemplating offering an alternative to CME’s product after discussions with biofuels companies, according to three sources familiar with the moves who asked not to be named because they are not authorized to speak publicly.

CME’s Chicago ethanol swap contract CUUc1 is the most widely used derivative instrument the industry uses to protect itself against market fluctuations. But traders have recently been reluctant to use the contract for fear it will expose them to further losses due to the strong selling by ADM.

More : https://www.reuters.com/article/us-...orm-as-markets-plunge-adm-sells-idUSKBN1OG1YX


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## Urbanova

American cities are still very car-oriented. What is a healthy relationship between cars and urban areas? I describe this relationship and possible options, yes you can choose for this relationship ;-)

https://medium.com/@ericterlien/how-to-fit-the-car-in-urban-areas-a264c26044c6


----------



## hkskyline

Jan 5, 2019
*Shutdown risks delays to U.S. drilling, ethanol, wind initiatives*
_Excerpt_

WASHINGTON/NEW YORK (Reuters) - The partial government shutdown is increasing the chances of delays in U.S. energy initiatives from the release of President Donald Trump’s proposed offshore drilling plan to allowing higher levels of ethanol in gasoline during summer months, energy industry groups said on Friday.

The U.S. Department of Interior had been expected to release its highly anticipated 2019 to 2024 offshore oil and gas drilling plan in early January.

The Trump administration has made opening up greater areas to offshore drilling, and holding more frequent lease sales, part of its energy dominance agenda to boost fossil fuel output for both domestic use and exports. Industry interest in several lease sales has been tepid, but the administration has said more interest is expected in the future.

The Interior Department is operating at reduced staffing levels due to the partial shutdown, which has stretched two weeks.

Nicolette Nye, a spokeswoman at the National Ocean Industries Association, said her group is expecting the shutdown will lead to a delay in the proposed plan’s release. But she said members of her group should not be overly affected as long as the final drilling plan, expected to be released this summer, comes on time.

“It’s always a good thing to have something in place that they can use to plan on. But it’s more important to have the final plan on schedule for our companies,” Nye said.

More : https://www.reuters.com/article/us-...illing-ethanol-wind-initiatives-idUSKCN1OY1TX


----------



## hkskyline

*Long, strange trip: How U.S. ethanol reaches China tariff-free*
_Excerpt_

NEW YORK/KUALA LUMPUR, Feb 7 (Reuters) - In June, the High Seas tanker ship loaded up on ethanol in Texas and set off for Asia.

Two months later - after a circuitous journey that included a ship-to-ship transfer and a stop in Malaysia - its cargo arrived in China, according to shipping data analyzed by Reuters and interviews with Malaysian and Chinese port officials.

At the time, the roundabout route puzzled global ethanol traders and ship brokers, who called it a convoluted and costly way to get U.S. fuel to China. 

But the journey reflects a broader shift in global ethanol flows since U.S. President Donald Trump ignited a trade war with China last spring.

Although China slapped retaliatory tariffs up to 70 percent on U.S. ethanol shipments, the fuel can still legally enter China tariff-free if it arrives blended with at least 40 percent Asian-produced fuel, according to trade rules established between China and the Association of Southeast Asian Nations (ASEAN), the regional economic and political body.

In a striking example of how global commodity markets respond to government policies blocking free trade, some 88,000 tonnes of U.S. ethanol landed on Malaysian shores through November of last year - all since June, shortly after China hiked its tax on U.S. shipments. The surge follows years of negligible imports of U.S. ethanol to Malaysia.

More : https://www.reuters.com/article/usa...hanol-reaches-china-tariff-free-idUSL1N202016


----------



## hkskyline

March 22, 2019
*Floods shut nearly a sixth of U.S. ethanol production*
_Excerpt_

MEAD, Neb./NEW YORK (Reuters) - Massive flooding in the U.S. Midwest has knocked out roughly 13 percent of the country’s ethanol production capacity, as plants in Nebraska, Iowa and South Dakota have been forced to shut down or scale back production following the devastation.

Production facilities owned by large companies like Archer Daniels Midland Co and Green Plains Inc were still operating despite days of snowstorms followed by rains that sent record floods into the Farm Belt.

However, with rail lines are washed out, and corn in storage flooded, production is dropping off, sending prices spiking in markets that buy the corn-based fuel.

The U.S. has some 200 ethanol plants capable of producing 1.06 million barrels per day, and about 100,000 to 140,000 bpd of capacity has been taken off line due to the floods, according to three traders who track operations.

Crop damage exceeds $400 million in Nebraska alone, according to Nebraska officials.

The disruption comes as the ethanol industry is in the midst of a historic downswing due to the ongoing trade conflict with China and sluggish domestic demand growth that has led to high inventories and weak margins.

More : https://www.reuters.com/article/us-...sixth-of-u-s-ethanol-production-idUSKCN1R30EG


----------



## hkskyline

April 2, 2019
*EPA waits on DOE input to process small refinery waivers for 2018 from U.S. biofuel law*
_Excerpt_

WASHINGTON (Reuters) - The U.S. Environmental Protection Agency is waiting to receive input from the Department of Energy to process 2018 applications exempting small refineries from U.S. biofuel laws, the agency’s administrator Andrew Wheeler said on Tuesday.

Speaking at a hearing at the House Appropriations Committee, Wheeler said he expected to receive the DOE input over the next couple of days and would process the applications “on a timely basis.”

“As far as the 2018 applications we have not received the official applications from DOE yet,” Wheeler said at the hearing about EPA’s budget. “We’re expecting those any day now, probably the next couple of days.”

Currently, there are 39 outstanding petitions for exemptions for 2018, EPA data shows.

The Renewable Fuel Standard is a federal program that requires that transportation fuel sold in the United States contains a minimum amount of renewables biofuels like ethanol each year, or that refiners buy blending credits from those that conform with the program.

More : https://www.reuters.com/article/us-...s-for-2018-from-u-s-biofuel-law-idUSKCN1RE1Q0


----------



## hkskyline

*In case over biofuel law waivers, U.S. court denies temporary injunction*
_Excerpt_

NEW YORK, May 17 (Reuters) - A U.S. biofuels trade group on Friday lost a bid for a temporary injunction on the granting of exemptions to refineries from laws that require them to blend biofuels into gasoline.

The U.S. Court of Appeals in Washington on Friday denied the Advanced Biofuel Association's request that the U.S. Environmental Protection Agency be ordered to stop issuing hardship exemptions to small refineries.

The group had asked for the injunction while its ongoing challenge of the EPA's expansion of the waiver program was decided.

In a one-page order the court said the trade group "has not satisfied the stringent requirements for an injunction."

Michael McAdams, who heads the trade group, called the ruling "disappointing."

The waivers can exempt refineries with production capacity of 75,000 barrels per day or less from the Renewable Fuel Standard, which mandates U.S. refiners blend biofuels into the fuel pool or buy compliance credits from those who do.

Under President Donald Trump, EPA has vastly expanded the biofuel waiver program to save the oil industry money. This has angered Midwest farmers who say the policy destroys demand for corn-based ethanol and other biofuels at a time they are already struggling, putting the administration in the center of a fight between two key constituencies.


----------



## hkskyline

*Exclusive: EPA to unveil less ambitious U.S. biofuel credit reform - sources *
_Excerpt_
24 May 2019

WASHINGTON/NEW YORK (Reuters) - The U.S. Environmental Protection Agency plans to unveil a narrowed-down version of its proposed biofuel credit market reform this month after regulators concluded many of the agency’s initial ideas required more time to study, according to four people briefed on the matter.

President Donald Trump had instructed the EPA to develop the plan to reform the multi-billion-dollar market as a way to help the oil refining industry, which had long complained that speculation was driving up costs for the credits they must acquire to comply with the nation's biofuel law.

Trump had asked that the EPA's reform be finalized prior to June 1 to coincide with the agency’s move to expand sales of gasoline blended with higher levels of corn-based ethanol, or E15, a measure meant to help farmers by expanding the market for corn.

But the sources, who asked not to be named, said there was not enough time to finalize most of the elements in the EPA's initial draft plan, which had been drawn up in March, in time for this month's launch of the E15 rule.

It is unclear whether a narrowed-down version of the market reform plan will limit the intended benefits to refiners.

The U.S. Renewable Fuel Standard requires refineries to blend biofuels into their gasoline and diesel each year, or purchase credits, called RINs, from those who do. The policy has helped farmers by creating a 15 billion gallon-a-year market for corn-based ethanol, but refiners have increasingly complained that compliance costs them a fortune – particularly when RIN prices are high and volatile.

More : https://www.reuters.com/article/us-...s-biofuel-credit-reform-sources-idUSKCN1ST2ML


----------



## hkskyline

*Trump lifts curbs on E15 gasoline to help farmers, angering Big Oil*
_Excerpt_

WASHINGTON, May 31 (Reuters) - The Trump administration on Friday lifted restrictions on the sale of higher ethanol blends of gasoline, keeping a campaign promise to farmers suffering from the trade war with China but drawing a legal threat from the oil industry.

The announcement will allow gasoline stations to sell blends containing up to 15 percent corn-based ethanol, called E15, year-round, ending a summertime ban that President Barack Obama’s Environmental Protection Agency imposed in 2011 to reduce smog pollution.

“As President Trump promised, EPA is approving the year-round sale of E15 in time for summer driving season,” EPA Administrator Andrew Wheeler said in a press release.

In a nod to the oil industry, the agency also issued new rules to improve transparency in the market for biofuels credits that refiners must acquire under the nation’s biofuel law, but the steps stopped short of what many refiners were seeking.

The widely anticipated action on E15 is a win for the U.S. farm lobby, which has argued the restrictions on E15 hurt growers by limiting demand for corn-based fuel, without providing tangible air quality benefits. Recent research has found little difference in smog risk between E15 and E10, a 10 percent ethanol blend that is already available year-round.

More : https://www.reuters.com/article/us-...-in-latest-boost-to-u-s-farmers-idUSKCN1T11BN


----------



## hkskyline

*Republican senators urge EPA to hold firm on refinery biofuel waivers*
June 27, 2019
_Excerpt_

WASHINGTON (Reuters) - Nine Republican U.S. senators on Wednesday urged the Trump administration’s environmental regulator to disregard a request by Democratic senators to stop issuing waivers to oil refiners on requirements to blend biofuels into motor fuels.

The Republican senators including Jim Inhofe, Ted Cruz, and Pat Toomey, said ditching the waivers would put thousands of refinery workers at risk and boost gasoline and diesel prices.

“The waivers simply diminish the burden of this terrible mandate on the refineries least able to afford it, and therefore allow them to continue doing business,” Toomey said in a release. Environmental Protection Agency Administrator Andrew Wheeler and President Donald Trump “should continue working to bolster our flourishing energy sector, not undermine it,” Toomey said.

Refiner waivers are outlined in the U.S. biofuels law, the Renewable Fuel Standard (RFS), which was designed to help American farmers by requiring oil refiners to blend certain volumes of biofuels, such as corn-based ethanol, into their fuel each year or purchase credits from those that do.

Small refineries with a production capacity of 75,000 barrels per day or less can secure waivers if they prove that compliance would cause them financial harm.

But farmers and lawmakers that support them say the waivers are being used too frequently. Under Trump, the EPA has vastly expanded the number of waivers granted to refineries, angering farmers who say the policy destroys demand for ethanol and other biofuels at a time they are already struggling.

More : https://www.reuters.com/article/us-...irm-on-refinery-biofuel-waivers-idUSKCN1TR2ZE


----------



## hkskyline

Aug 16, 2019
_Excerpt_
*Trump intervention triggered EPA's surprise biofuel waiver decision: sources
*
WASHINGTON (Reuters) - A phone call from U.S. President Donald Trump last week ended a nearly two-month-long review of the nation’s biofuels program, three sources familiar with the matter said, with the White House siding in favor of oil refiners over corn growers.

Trump gave Andrew Wheeler, head of the U.S. Environmental Protection Agency, the green light for the regulator to announce it had granted 31 small refinery exemptions out of the 40 applications, saying he wanted the issue off his desk, the sources said.

Trump’s call triggered a flurry of action within the EPA, leading up to a surprise Friday afternoon announcement, after weeks of negotiations between U.S. government agencies failed to make progress in addressing farmers’ concerns.

“The president has heard from all sides and in the end he has had enough of it. He called Wheeler and gave him the green light,” a source familiar with knowledge of the matter said.

The White House has sought to make changes to the nation’s biofuels laws since the beginning of Trump’s administration in early 2017, but found themselves caught between the powerful oil and corn lobbies, both of whom have allies in Washington in Trump’s Republican Party.

More : https://www.reuters.com/article/us-...biofuel-waiver-decision-sources-idUSKCN1V610F


----------



## hkskyline

*Trump administration promises biofuel boost to farmers, angering Big Oil*
Oct 4, 2019
_Excerpt_

WASHINGTON/NEW YORK (Reuters) - The Trump administration on Friday unveiled a plan to boost U.S. biofuels consumption starting next year to help struggling farmers, a move that cheered the agriculture industry but triggered a backlash from Big Oil.

The plan would require an unspecified increase in the amount of ethanol that oil refiners must add to their fuel in 2020, and would also aim to remove further barriers to the sale of higher ethanol blends of gasoline like E15, the Environmental Protection Agency said in a statement.

“President Trump’s leadership has led to an agreement that continues to promote domestic ethanol and biodiesel production, supporting our nation’s farmers and providing greater energy security,” EPA Administrator Andrew Wheeler said.

The deal is widely seen as an attempt by President Donald Trump to mend fences with the powerful corn lobby, which was outraged by the EPA's decision in August to exempt 31 oil refineries here from their obligations under the RFS. This freed the refineries from the requirement to blend biofuels or buy credits from those who do.

Biofuel companies, farmers and Midwest lawmakers complained that the waivers undercut demand for corn, which is already slumping due to the U.S. trade war with China. Oil refiners say the waivers protect blue-collar jobs and have no real impact on ethanol use.

More : https://www.reuters.com/article/us-...ost-to-farmers-angering-big-oil-idUSKBN1WJ19P


----------



## hkskyline

* Trump says ethanol deal will be around 16 billion gallons *
Oct 8, 2019
_Excerpt_

WASHINGTON (Reuters) - U.S. President Donald Trump said on Monday his administration’s proposal to boost the biofuels market next year would bring the amount of corn-based ethanol mixed into the nation’s fuel to about 16 billion gallons (60.6 billion liters).

“We’ve come to an agreement and its going to be, I guess, about, getting close to 16 billion ... that’s a lot of gallons. So they should like me out in Iowa,” he told a news conference.

The U.S. Renewable Fuel Standard (RFS) program currently requires refiners to blend 15 billion gallons of ethanol per year, but the corn lobby has said the Environmental Protection Agency’s use of waivers means the actual volumes blended are lower than that.

Trump's EPA unveiled the plan here last week to boost U.S. biofuels consumption to help struggling farmers, but did not provide an exact figure. The plan cheered the agriculture industry but triggered a backlash from Big Oil, which views biofuels as competition.

The deal is widely seen as an attempt by Trump, who faces a re-election fight next year, to mend fences with the powerful corn lobby, which was outraged by the EPA’s decision in August to exempt 31 oil refineries from their obligations under the RFS. 

More : https://www.reuters.com/article/us-...ll-be-around-16-billion-gallons-idUSKBN1WM298


----------



## hkskyline

Nov 8, 2019
*ADM offers free corn drying at three Midwest processing plants*
_Excerpt_

CHICAGO (Reuters) - Grain merchant Archer Daniels Midland Co is waiving the fees it charges farmers to dry grain at three of its Midwestern corn processors as it seeks supplies to keep the plants running at optimum levels through a slow, wet harvest period, a spokeswoman said on Thursday.

Farmers, who are weeks behind schedule in much of the U.S. corn belt due to rainy harvest conditions, have been reluctant to sell their grain at current price levels. Free drying offers them a significant break as tight supplies of propane needed to run grain driers have sent costs soaring this fall.

ADM’S chief financial officer said last week the company expected wet crops would lead to increased revenues from its drying operations.

But a spokeswoman said in an e-mailed statement that ADM on Wednesday started offering free drying of corn at 19% moisture rate or less that farmers brought to its wet corn mills in Decatur, Illinois, Cedar Rapids, Iowa, and Clinton, Iowa. The plants process corn into ethanol and produce ingredients used by food and beverage companies.

Corn must be dried to a certain moisture level to be sold, stored safely or processed. 

“This has been a difficult harvest for farmers, and we are taking additional steps at a few of our processing locations to help farmers manage the very wet corn conditions,” an ADM spokesperson said in a statement.

The three plants can produce an estimated 1.08 billion gallons of ethanol a year, according to data from the Renewable Fuels Association. ADM is considering spinning off its ethanol business as the industry struggles with tight profit margins.

More : https://www.reuters.com/article/us-...three-midwest-processing-plants-idUSKBN1XH2VU


----------



## hkskyline

Dec 18, 2019
*White House says it is sticking with 2020 biofuel plan, despite farmer objections*
_Excerpt_

NEW YORK (Reuters) - The Trump administration plans to stick with its proposed 2020 biofuel blending requirements, the White House said on Wednesday, despite anger among farmers that the plan does too little for corn growers.

The decision could undermine President Donald Trump’s support among farmers, an important constituency in the November 2020 election. Some U.S. farmers have already been hurt by the United States’ prolonged trade war with China.

“The Administration is moving forward to finalize the 2020 RVO (Renewable Volume Obligations) in line with the agreement that the President made this fall,” White House spokesman Judd Deere said.

Deere confirmed he was talking about a proposal unveiled by the Environmental Protection Agency in October, which was intended to compensate the biofuel industry for the administration’s expanded use of refinery waivers, but which the industry has largely panned as insufficient.

Under the U.S. Renewable Fuel Standard, oil refiners are required to blend some 15 billion gallons of corn-based ethanol into their gasoline every year, but small facilities can be exempted if compliance would hurt them financially.

More : https://www.reuters.com/article/us-...-plan-despite-farmer-objections-idUSKBN1YM1PX


----------



## hkskyline

Jan 8, 2020
*Exclusive: China suspends national rollout of ethanol mandate - sources* 
_Excerpt_

BEIJING (Reuters) - China has suspended its plan to implement a nationwide gasoline blend containing 10% ethanol this year, three sources briefed on the matter said, following a sharp decline in the country’s corn stocks and limited production capacity of the biofuel.

The reversal is a heavy blow to domestic producers that have built new plants, as well as biofuel exporters, including the United States and Brazil, which were looking to benefit from growing Chinese demand. China was expected to increase imports of U.S. ethanol after the recent announcement of Phase 1 of a trade agreement.

Beijing announced in September 2017 that the national gasoline supply would contain 10% ethanol from 2020, part of a broad reform of its corn industry that at the time was suffering from a massive surplus.

But at a meeting in late December with ethanol producers and oil majors, China’s National Development and Reform Commission (NDRC) said it will now halt the rollout of ethanol-gasoline supplies beyond the current handful of provinces that have already implemented full or partial blends, according to two of the three sources briefed on the meeting.

Beijing’s mandate - known as the E10 target - was conceived as a way to digest the country’s huge state corn reserves and reduce pollution in the world’s largest car market by using the cleaner-burning fuel. China is now unlikely to require large ethanol supplies without the mandate.

More : https://www.reuters.com/article/us-...lout-of-ethanol-mandate-sources-idUSKBN1Z71R8


----------



## hkskyline

* Congressional watchdog to review Trump admin's use of biofuel waivers *
_Excerpt_

NEW YORK, Jan 10 (Reuters) - The U.S. Government Accountability Office (GAO) will review the Trump administration's use of waivers exempting oil refineries from the nation's biofuel blending requirements, according to a letter dated Friday, after lawmakers called for an investigation.

The so-called Small Refinery Exemptions are intended to protect refineries in financial distress from the cost of blending ethanol into gasoline, but the U.S. corn lobby and its representatives have accused the administration of overusing them to help oil companies at the expense of farmers.

The GAO, a congressional watchdog unit, accepted the request from lawmakers - including Iowa Representative Abby Finkenauer, Minnesota Representative Collin Peterson and Illinois Representative Rodney Davis - to examine the administration's handling of the waivers handed out for the 2018 compliance year.

The group in August had asked the GAO in a letter to review the factors that the Trump administration's Environmental Protection Agency considered in approving the waivers, and to examine the Department of Energy's process for recommending exemptions to EPA, according to the letter.

"GAO accepts your request," GAO Managing Director of Congressional Relations Orice Williams Brown wrote to the lawmakers in its response dated Jan. 10. The letter said work will begin "shortly" on the review.

Under the U.S. Renewable Fuel Standard, refineries are required to blend 15 billion gallons of ethanol annually. But the EPA can exempt small facilities that demonstrate compliance would hurt them financially.

More : https://www.reuters.com/article/us-...trations-use-of-biofuel-waivers-idUSKBN1Z92A4


----------



## hkskyline

* Republican senators ask EPA not to boost refinery biofuel obligations in 2021 *
_Excerpt_
Oct 21, 2020

NEW YORK (Reuters) - A group of U.S. Republican senators asked the Environmental Protection Agency on Wednesday to consider a general waiver that would prevent an increase in biofuel blending obligations next year for oil refiners hit by a collapse in fuel demand because of the coronavirus pandemic.

Senators including Shelley Moore Capito of West Virginia and Ted Cruz from Texas said the waiver for 2021 would help refiners cope with the pandemic, which has pushed gasoline demand down more than 10% from year-ago levels.

U.S. laws require the refining industry to blend increasing amounts of biofuels into their fuels each year, requirements that have helped farmers by creating a huge market for corn-based ethanol, but which refiners say is costly.

More : Republican senators ask EPA not to boost refinery biofuel obligations in 2021


----------



## hkskyline

* U.S. EPA considering E15 labeling changes at gas pumps: sources*
_Excerpt_
Oct 26, 2020

NEW YORK (Reuters) - The U.S. Environmental Protection Agency is considering changes to labels for gasoline containing higher blends of ethanol, or E15, in an effort to appease the biofuel industry’s concerns that current labels discourage use of the fuel, according to four sources familiar with the matter.

Expanding the market for E15 has long been a policy goal for farmers and producers of ethanol, a corn-based product, but concerns that some older vehicles don’t run well on the product have been a headwind. Current federal E15 labels warn of possible engine damage.

The Trump administration, meanwhile, has been trying to shore up support in the Farm Belt ahead of the election through favorable announcements for biofuel advocates.

More : U.S. EPA considering E15 labeling changes at gas pumps: sources


----------



## hkskyline

* U.S. renewable fuels legislation could garner bipartisan support under Biden *
Reuters _Excerpt_
Nov 10, 2020

Renewable fuels are a niche market for now, but with Democratic President-Elect Joe Biden set to enter office with a divided Congress, legislation supporting demand for products like renewable diesel could garner bipartisan support.

Biden, elected president last week, defeating Republican Donald Trump, has pledged to move the United States to a zero-carbon emissions scheme by 2050. Under a divided Congress, however, ambitious plans to tackle rising emissions may be put on ice.

Renewable fuels, however, may be different: their development is supported by some in both the oil and green energy industries.

More : U.S. renewable fuels legislation could garner bipartisan support under Biden


----------



## hkskyline

* Column: U.S. ethanol recovery threatened by rising virus restrictions *
Reuters _Excerpt_
Nov 19, 2020 

U.S. ethanol production, a main source of demand for domestic corn, has been unusually light ever since March, when the coronavirus pandemic sharply curbed global fuel consumption.

Ethanol output in recent weeks has very slowly chipped away at its deficit versus prior years, but the resurgence of the virus and increasing restrictions, especially just before the holidays, threaten to derail a comeback in fuel demand.

According to data from the U.S. Energy Information Administration, U.S. fuel ethanol output in the week ended Nov. 13 totaled 962,000 barrels per day, down 1.5% from the previous week’s volume, which was the highest since the week ended March 20.

More : Column: U.S. ethanol recovery threatened by rising virus restrictions


----------



## hkskyline

* U.S. fuel industry frazzled as Trump EPA misses 2021 biofuel volumes deadline *
_Excerpt_
Nov 30, 2020

NEW YORK (Reuters) - The U.S. Environmental Protection Agency was set to miss a deadline on Monday to announce how much renewable fuel the nation’s refiners must blend into their fuel mix next year, raising uncertainty in the fuel market and prompting one biofuel association to threaten to take the agency to court.

Under federal law, the EPA must finalize its decision on the annual biofuel blending volume requirements it imposes on the refining industry for the next year by Nov. 30. The agency did not respond to requests for comment.

“At this point, it likely makes more sense to let the new administration handle the 2021 RVO (Renewable Volume Obligations) rulemaking process entirely,” said Geoff Cooper, the president of the Renewable Fuels Association, one of the nation’s biggest biofuel industry groups.

More : U.S. fuel industry frazzled as Trump EPA misses 2021 biofuel volumes deadline


----------



## hkskyline

* U.S. biofuel coalition escalates legal attack on EPA blending waivers *
_Excerpt_ 
Dec 9, 2020

NEW YORK (Reuters) - A coalition of U.S. biofuel groups announced on Tuesday it had filed a brief with the D.C. Circuit Court of Appeals challenging the Trump administration’s decision in 2019 to grant 31 oil refineries exemptions from U.S. biofuel blending obligations.

The brief borrows arguments from a successful case that several members of the group had filed in the Tenth Circuit Court of Appeals. That case spurred controversy this year when the court sided with the biofuel industry and cast doubt on the legitimacy of the waiver program.

The biofuel industry claims the waivers hurt demand for corn-based ethanol; the oil industry disputes that and says the exemptions are needed to keep small refineries afloat.

Under U.S. law, refiners must blend billions of gallons of biofuels into their fuel, or buy tradable credits from those that do. Small refiners have sought and obtained exemptions to the requirements if they prove compliance would cause them financial harm.

In the most recent brief, groups including the Renewable Fuels Association, National Corn Growers Association and the National Farmers Union said the EPA lacked the authority to issue the 31 small refinery exemptions for the 2018 compliance year because they had not been granted continuously in the preceding years, according to the brief dated Dec. 7.

More : U.S. biofuel coalition escalates legal attack on EPA blending waivers


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## hkskyline

* U.S. EPA aims for December for 2021 biofuel volume proposal *
Reuters _Excerpt_ 

Dec 14 - The U.S. Environmental Protection Agency is now aiming for Dec. 31 as the point by which it will propose rules on the amount of biofuels refiners must blend into their fuel mix next year, after missing a deadline last month to release the proposal.

Under the adjusted timeline, the agency will aim to finalize the rule on the so-called Renewable Volume Obligations in June 2021, according to the agency’s agenda on the Office of Information and Regulatory Affairs’ website.

EPA is in charge of administering the U.S. Renewable Fuel Standard, which requires refiners to blend billions of gallons of biofuels into their fuel mix each year, or buy tradable credits from those that do.

The regulation is a lightning rod of contention between the corn industry, which supports it because it creates demand for ethanol, and the refining industry, which opposes it because it is costly and competes with traditional petroleum fuels.

More : U.S. EPA aims for December for 2021 biofuel volume proposal


----------



## hkskyline

* U.S. renewable fuel credits climb to 3-yr high as EPA misses deadline *
_Excerpt_
Jan 4, 2021

NEW YORK (Reuters) - U.S. renewable fuel credits rose on Monday to a three-year high, traders said, after the Trump administration failed for the second time to meet a deadline to propose rules on the amount of biofuels refiners must blend into their fuel mix this year.

The U.S. Environmental Protection Agency (EPA) had been aiming for Dec. 31 to propose a rule on so-called Renewable Volume Obligations for 2021, according to its agenda on the Office of Information and Regulatory Affairs’ website. The EPA previously missed a Nov. 30 deadline, after the coronavirus pandemic complicated the rulemaking process.

Renewable fuel (D6) credits traded at 79.5 cents each on Monday, the highest since December 2017. Biomass-based (D4) credits traded at $1.04 each, highest since November 2017. D4 credits were in part led higher by higher prices for soybeans.

EPA is in charge of administering the U.S. Renewable Fuel Standard, which requires refiners to blend billions of gallons of biofuels into their fuel mix each year, or buy tradable credits from those that do.

The regulation has sparked a fierce debate between the oil and biofuel industries. The oil industry claims the rules are too costly, while corn farmers and biofuel producers support the regulation because it boosts ethanol demand.

More : U.S. renewable fuel credits climb to 3-yr high as EPA misses deadline


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## hkskyline

* China bought about 200 million gallons of U.S. ethanol for first-half 2021: ADM * 
_Excerpt_
Jan 27, 2021

CHICAGO/BEIJING (Reuters) - China has bought “roughly 200 million gallons” of U.S. ethanol for the first half of 2021, matching its previous record for annual imports of the corn-based biofuel, Archer Daniels Midland Co Chief Financial Officer Ray Young said on Tuesday.

The accelerated imports are among several positive signs for the ethanol sector which has been hard hit by years of oversupply and, more recently, a sharp drop in demand as the coronavirus pandemic slashed fuel use.

Imports of 200 million gallons would eclipse China’s previous annual record of 198.1 million gallons in 2016, according to U.S. Census Bureau trade data.

More : China bought about 200 million gallons of U.S. ethanol for first-half 2021: ADM


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## hkskyline

* Column: U.S. ethanol output slips as China rumored to be back in the market * 
_Excerpt_
Jan 28, 2021

FORT COLLINS, Colo. (Reuters) - U.S. ethanol output has remained generally weak in January amid shabby profitability, though a shot of optimism arrived this week on a report that China, which somewhat shunned the American biofuel four years ago, has already secured a record annual haul for 2021.

China has never been a leading player on the U.S. ethanol export front and the corn-based biofuel historically accounts for a small portion of American farm product trade. But possibilities could be strong given China’s generally thin supplies of agricultural commodities and its record purchases of items like corn and soybeans.

The chief financial officer of Archer Daniels Midland Co said on Tuesday that China had already secured about 200 million gallons of U.S. ethanol for the first half of 2021. That would tie the previous annual record for U.S. exports of the biofuel to China set in 2016.

More : Column: U.S. ethanol output slips as China rumored to be back in the market


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## hkskyline

* Some U.S. ethanol producers reduce production to sell natural gas for a profit *
_Excerpt_ 
Feb 16, 2021

NEW YORK (Reuters) - Sky-high U.S. natural gas prices have prompted some Midwestern ethanol producers to reduce processing in the last week, hoping instead to sell off some of their natural gas to take advantage of current high spot prices caused by the spike in cold weather, industry sources said.

Ethanol margins in the Corn Belt have dropped sharply due to the frigid weather, falling to negative-$3.92 a gallon, lowest since at least 2010, Refinitiv Eikon data showed. Natural gas prices have soared because of power needs, hitting their highest levels in years due to the cold snap.

At the Waha hub in the Permian basin in Texas, next-day gas prices rose last week to as high as $157.714 per million British thermal units (mmBtu).

The astronomical prices forced some ethanol producers who have not yet purchased all their needed natural gas to consider whether to reduce processing to avoid the high prices. It has forced others who have their natural gas bought to consider whether to reduce production rates to sell into the spot market. 

More : Some U.S. ethanol producers reduce production to sell natural gas for a profit


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## hkskyline

* Once Wary Ethanol Market Hails Potential of Clean-Fuel Policy *
Bloomberg _Excerpt_ 
Feb 16, 2021

Ethanol producers that once opposed California’s Low Carbon Fuel Standard are now wondering how fast the emissions-cutting policy can expand across the U.S.

That question and how a broader LCFS might co-exist with the Renewable Fuel Standard, the federal mandate on blending biofuels with gasoline, will be in focus at a virtual three-day ethanol conference kicking off Tuesday.

Interest in California’s market-based program, which brings together renewable fuel and electricity stakeholders in a goal to cut vehicle emissions 20% by 2030, is rising. OTC Direct, an online trading platform launched in December to make RFS-tied biofuel blending credits more liquid, added LCFS weeks after starting in response to customer demand.

More : Bloomberg - Are you a robot?


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## hkskyline

* Ethanol Output Plunges Most on Record After US Deep Freeze *
Bloomberg _Excerpt_ 
Feb 24, 2021

Ethanol production in the U.S. dropped the most on record last week as a historic cold snap prompted some plants to slow or completely shut down amid power outages and a spike in natural gas prices.

Output slid 28% to 658,000 barrels a day, according to the Department of Energy. The decline was the biggest in figures going back to 2010, according to data compiled by Bloomberg. Production was also below the average estimate of 819,000 in Bloomberg survey of analysts.

A brutal cold snap in the central U.S., home to the bulk of the country’s ethanol production, caused some plants to lose electricity and others to slow down or temporarily stop operations to conserve energy as natural gas prices soared. Some makers of the corn-based biofuel pulled back output as much as 60%, Renewable Fuels Association President Geoff Cooper said last week.

More : Ethanol Output Plunges Most on Record After U.S. Deep Freeze


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## hkskyline

*Can the future of electric vehicles destroy the ethanol industry? * 
KGAN _Excerpt_ 
Feb 27, 2021

America is in the early stages of a shift from combustion engine cars and trucks to all-electric vehicles, or EV. Electric cars are quiet, sporty and cost a fraction to charge than it costs to gas up their traditional counterparts. But as more motorists reach for the plug instead of the pump, some are concerned it will hurt farmers so connected to a healthy biofuels market.

Senator Joni Ernst is not happy about President Biden's order requiring federal agencies purchase EV instead of gas vehicles whenever possible. In a recent op-ed, Senator Ernst said: "If the entire United States moves to all-electric vehicles—like the Biden-Harris Administration wants—say goodbye to Iowa-grown biofuel and the livelihoods of the hardworking folks who labor night and day to provide these clean fuel options.”

Former Iowa Governor and newly sworn-in Secretary of Agriculture Tom Vilsack disagrees. "I don’t see why we can’t have both and over a long period of time we’re going to need both."

More : Can the future of electric vehicles destroy the ethanol industry?


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## Inhumas

hkskyline said:


> *Can the future of electric vehicles destroy the ethanol industry? *
> KGAN _Excerpt_
> Feb 27, 2021
> 
> America is in the early stages of a shift from combustion engine cars and trucks to all-electric vehicles, or EV. Electric cars are quiet, sporty and cost a fraction to charge than it costs to gas up their traditional counterparts. But as more motorists reach for the plug instead of the pump, some are concerned it will hurt farmers so connected to a healthy biofuels market.
> 
> Senator Joni Ernst is not happy about President Biden's order requiring federal agencies purchase EV instead of gas vehicles whenever possible. In a recent op-ed, Senator Ernst said: "If the entire United States moves to all-electric vehicles—like the Biden-Harris Administration wants—say goodbye to Iowa-grown biofuel and the livelihoods of the hardworking folks who labor night and day to provide these clean fuel options.”
> 
> Former Iowa Governor and newly sworn-in Secretary of Agriculture Tom Vilsack disagrees. "I don’t see why we can’t have both and over a long period of time we’re going to need both."
> 
> More : Can the future of electric vehicles destroy the ethanol industry?


Wasn't the whole point of the EV revolution coming from California to put a stop on the expansion of corn-based ethanol, both because they had decided that corn ethanol is not that clean, and also because they worried about too much farmlands being used for fuel production?
I'm Brazilian and the impression that I get is that Californians were always as aggressive to the idea of corn ethanol as they were to the fossil fuel industry. Here's an article that I found from 2011




__





Corn ethanol policy under attack in California | EthanolProducer.com


Corn ethanol opponents in California achieved a small victory on April 25 after the state assembly natural resources committee approved a bill that would make corn ethanol ineligible for state funding and repeal the state’s ethanol incentive program.



ethanolproducer.com


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## hkskyline

* Energy Crisis Pressures Sugar Market as Ethanol Output Booms *
Bloomberg _Excerpt_
Nov 1, 2021

The global energy crunch is putting pressure on the sugar market as the world’s top exporters convert more cane into ethanol.

Sugar hit a four-year high in October as energy supply shortages roiled commodity markets from magnesium to tomatoes. Facing rampant fuel inflation, Brazil and India are set to produce more ethanol from sugar cane, ensuring supply of sweetener remains tight.

“These are the two big players in the sugar market and the fact that the pressure’s on them to produce more ethanol in the next 12 months is supportive of sugar prices,” said John Stansfield, a trader and analyst at Group Sopex.

More : Bloomberg - Are you a robot?


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## hkskyline

*U.S. Ethanol Maker Eyes Low-Carbon Sugar as Potential ‘Moonshot’ *
Bloomberg _Excerpt_
Nov 4, 2021

Shares of Green Plains Inc. rebounded after touching a six-week low as the U.S. ethanol maker touted progress in its attempt to transform into a powerhouse of high-value ingredients made from corn.

The company posted a bigger loss than forecast loss as a surge in the cash corn market led ethanol crush margins down 93% to $1.1 million, or 1 cent per gallon in the July-September period. That pressure has since eased with a new bumper crop replenishing supply and easing near-record local prices. 

“Results weren’t stellar, but the corn basis issues that weighed on earnings are in the rear-view mirror,” said Stephens Inc. analyst Ben Bienvenu, who has an “overweight” rating on the stock and is reviewing his price target. Fourth quarter looks “very strong.” 

Chief Executive Officer Todd Becker has been working to sharply reduce Green Plains’ reliance on ethanol, with an aim to reinvent the company into a low-carbon maker of high-protein and sugar ingredients made from corn for use in products ranging from pet food to candy, with biofuel merely a byproduct. 

More : Bloomberg - Are you a robot?


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## hkskyline

*Global Ethanol Market to reach US$ 131.6 Bn by end of 2027, Says Coherent Market Insights *
_Excerpt_

SEATTLE, Nov. 8, 2021 /PRNewswire/ -- According to Coherent Market Insights, The global ethanol market is estimated to account for 131.6 Bn in terms of value, witnessing a CAGR of 4.9% by the end of 2027.

Ethanol is an organic compound that is made from fermented agricultural products like grain, leafy vegetables and animal waste. Unlike other renewable fuel sources, ethanol can be directly converted into liquid fuels, also known as "biodiesel fuels," to meet automotive fuel demands.

Ethanol is produced through fermentation of sugars and starch with the help of the necessary bacteria and yeast. There are two ways to create ethanol: directly by using the animals' waste, and indirectly by using wood and pulp from forests or wood chips. Direct expression of the alcohol is done by distilling the alcohol. On the other hand, indirect expression of the alcohol is done through the process of trans esterification wherein the end products of the fermentation are treated with chemicals for the purpose of clarification and separation. The result is a mixture of sugars and starch, and sometimes, other elements such as nitrogen and phosphorous are added. When this mixture is fermented, the yeast converts it into ethanol, and the mixtures are then transferred to a vat, where they undergo further treatment for a period of time, during which time the mixtures ferment even more, resulting in more ethanol.

More : Global Ethanol Market to reach US$ 131.6 Bn by end of 2027, Says Coherent Market Insights


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## hkskyline

*Ethanol Lobby to White House: Biofuel Rule Rollback Won't Lower Gas Prices*
Bloomberg _Excerpt_
Nov 16, 2021

The ethanol industry warns the Biden administration that rolling back national biofuel blending rules to lower gasoline prices would be a big mistake.

“We were shocked to learn that one of the potential actions reportedly being discussed by the White House is ‘relaxing mandates to mix gasoline with biofuels’,” Renewable Fuels Association CEO Geoff Cooper wrote to Brian Deese, director of the White House National Economic Council.

More : Bloomberg - Are you a robot?


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## hkskyline

*Raizen, Shell to supply second-generation ethanol to Ferrari F-1 team *
_Excerpt_ 

SAO PAULO/RIO DE JANEIRO, Nov 14 (Reuters) - Brazilian energy company Raizen SA (RAIZ4.SA) and its shareholder Royal Dutch Shell Plc (RDSa.L) signed an agreement with the Ferrari Formula 1 team to supply second-generation, high-performance ethanol from next year, when the main motor racing category will begin using 10% ethanol blend in gasoline.

More : Raizen, Shell to supply second-generation ethanol to Ferrari F-1 team


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## hkskyline

* Soaring ethanol prices stinging New Brunswick drivers, even those who don't use it *
CBC _Excerpt_
Nov 22, 2021

Soaring prices in the United States for the plant-based fuel ethanol are hitting consumers at the gas pumps in New Brunswick, even at pumps that don't carry ethanol. 

It's an expensive pricing oddity that has been causing confusion for provincial drivers, wholesalers and retailers, acknowledges the New Brunswick Energy and Utilities Board. 

"We have had some calls," said David Young, the EUB's manager of regulatory affairs.

This week the maximum price for self-serve regular gasoline in New Brunswick as set by the EUB is 150.8 cents per litre. 

...

Both New Brunswick and Nova Scotia regulate prices of petroleum products sold in their provinces and use similar weekly "New York Harbour" trading prices of individual fuel grades as the starting point. 

But only New Brunswick has a mechanism to accommodate ethanol price spikes.

In mid-October, ethanol fuels, which in the U.S. are mostly distilled from corn and are normally cheaper than gasoline, surged in price and have steadily become the more expensive fuel.

More : https://www.cbc.ca/news/canada/new-brunswick/soaring-ethanol-prices-nb-drivers-1.6256225


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## hkskyline

* U.S. biofuel blending proposals to come in days, sources say *
_Excerpt_

NEW YORK, Dec 2 (Reuters) - The U.S. administration plans to propose in days the amount of biofuels oil refiners must blend into their fuel mix this year and next year, as it reaches out to lawmakers to discuss the move, three sources familiar with the matter said.

President Joe Biden's administration has delayed decisions on 2021 blending obligations by more than a year, and it missed a deadline to finalize 2022 obligations this week.

The delays came as the COVID-19 pandemic hammered fuel demand and Democratic lawmakers focused on other legislation.

More : U.S. biofuel blending proposals to come in days, sources say


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## hkskyline

*U.S. EPA to propose expanding credit eligibility under biofuel program -sources *
_Excerpt_ 

NEW YORK, Dec 3 (Reuters) - The Biden administration is expected to propose expanding the kinds of renewable fuel production processes that are eligible to receive credits under the U.S. Renewable Fuel Standard program, three sources familiar with the matter said.

The move could help increase production of advanced biofuels, which include lower-carbon products such as renewable diesel and sustainable aviation fuel, the sources said. It is expected to be included in a highly anticipated upcoming proposal that mandates the amount of biofuels that oil refiners must blend into their fuel mix, they said.

The Environmental Protection Agency, which administers the RFS, plans to announce the blending mandate proposal in days, Reuters reported on Thursday, citing sources.

More : U.S. EPA to propose expanding credit eligibility under biofuel program -sources


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## hkskyline

*EPA lowers ethanol requirements, citing reduced demand *
_Excerpt_
Dec 8, 2021

WASHINGTON (AP) — The Biden administration on Tuesday lowered annual production requirements for ethanol and other biofuels to account for reduced demand as a result of the coronavirus pandemic.

At the same time, the administration moved to reject requests by small oil refineries to be exempted from ethanol requirements, saying they had failed to show exemptions were justified under the Clean Air Act.

Taken together, the actions reflect the administration’s “commitment to reset and strengthen” the federal Renewable Fuel Standard, or RFS, “following years of mismanagement” by the Trump administration and disruptions to the gasoline market stemming from the COVID-19 pandemic, officials said.

More : EPA lowers ethanol requirements, citing reduced demand | AP News


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## Vuko44

del


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## hkskyline

*Kildee highlights bill that would allow more ethanol in gasoline year-round *
_Excerpt_
Mar 25, 2022

MID-MICHIGAN (WJRT) - Legislation in the U.S. House aims to lower gas prices while supporting Mid-Michigan farmers.

The Year-Round Fuel Choice Act was introduced last summer, but it's being considered now because of the near-record high gas prices.

The bill would allow gasoline to be sold with 15% ethanol year-round. Right now, gasoline can only be sold with that much ethanol in the summer months.

In winter, gasoline can only contain 10% ethanol.

Democrat Congressman Dan Kildee of Flint said increasing the ethanol content of gasoline would help farmers who grow corn, which is used to make the ethanol.

More : https://www.abc12.com/news/local/ki...cle_c885fada-ac32-11ec-ab66-1349f000c005.html


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## hkskyline

* Biden wants to expand use of ethanol gas blend into summer to ease pump prices *
USA Today _Excerpt_
Apr 12, 2022

President Joe Biden will announce Tuesday another step to try to reduce prices for drivers who have been paying more to fill up their tanks: expanding the availability of biofuels.

While visiting an ethanol plant in Iowa, Biden will announce the administration plans on allowing gasoline that uses a 15% ethanol blend to be sold during the summer, according to senior administration officials who spoke on condition of anonymity.

Called E15, the blend can cost 10 cents per gallon less on average at the 2,300 gas stations where it's sold, the officials said.

More : Biden wants to expand use of ethanol gas blend into summer to ease pump prices


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## hkskyline

* Biden announces emergency waiver on summer ethanol ban to combat rising gas prices *
CNN _Excerpt_
Apr 12, 2022

President Joe Biden on Tuesday announced new steps his administration is taking to address rising gasoline prices across the country, including emergency measures to expand biofuel sales, countering rising energy prices amid Russia's invasion of Ukraine.

The President announced that the Environmental Protection Agency will issue an emergency waiver permitting year-round sales of E15 gasoline, which contains a 15% ethanol blend, on a trip to Menlo, Iowa, where he visited POET Bioprocessing, a biofuels plant that specializes in the creation of bioethanol.

"E15 is about 10 cents per gallon cheaper than E10. Some gas stations offer an even bigger discount than that," Biden said. "But many of the gas stations that sell it ... are required to stop selling it in the summer, but with this waiver, on June 1, you're not going to show up and see a bag over the pump with the cheapest gas. You're going to be able to keep filling up with E-15 and it's going to solve a whole problem."

More : Biden announces emergency waiver on summer ethanol ban to combat rising gas prices


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## hkskyline

* Fact Finders: Will 15% ethanol seriously cut my gas mileage? *
_Excerpt_
Apr 21, 2022

SPRINGFIELD, Mo. (KY3) - President Joe Biden is waiving rules restricting ethanol blending. This summer, the waiver will allow the more widespread sale of a 15-percent ethanol blend. So, one of our viewers wants to know; Does Ethanol Reduce Your Gas Mileage?

Most gasoline sold in the U.S. is blended with 10% ethanol. The biofuel is currently cheaper than pure gas. E15 is usually prohibited between June 1st and September 15th. The administration predicts their action will save drivers an average of 10 cents per gallon based on current prices.

Fuel Analyst Patrick De Haan of Gas Buddy says Ethanol does not contain the same energy as gasoline. But he doesn’t think you’ll notice much difference in your Miles Per Gallon.

“The difference between 10% ethanol which is what most gasoline is sold as regular as blended with up to 10% ethanol, going from that to a product like e 15, which is only an increase from 10 to 15%. In terms of ethanol, that really is negligible. Most people would not notice a decrease in energy content in the form of lower fuel efficiency,” explained GasBuddy’s Head of Petroleum Analysis, Patrick De Haan.

More : Fact Finders: Will 15% ethanol seriously cut my gas mileage?


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## hkskyline

* U.S. EPA issues waiver to allow temporary sales of summertime higher-ethanol fuel*
Reuters _Excerpt_
Apr 29, 2022

The U.S. Environmental Protection Agency issued an emergency waiver for a higher-ethanol gasoline blend on Friday, allowing summertime sales of the fuel in an attempt to help lower gasoline prices at the pump.

The move represents a temporary win for the biofuels industry and corn farmers, as it will likely expand sales of corn-based ethanol, and a setback for oil refiners, which view ethanol as competition.

It also is an attempt to temper the pace of inflation which has surged to a 16-year high.

More : U.S. EPA issues waiver to allow temporary sales of summertime higher-ethanol fuel


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## hkskyline

* Nebraska Corn Board trying to get more people to use ethanol *
_Excerpt_
May 6, 2022

LINCOLN, Neb. (KLKN) – May has been declared “Renewable Fuel Month” in Nebraska, and the state Corn Board is trying to educate people about the benefits of renewable fuel.

For gasoline-powered cars, there are two renewable fuels: E-15 and E-85, also known as Flex Fuel.

E-15 is a gasoline blend with 15% ethanol in it.

Here in Lincoln, there are only a few places that sell it. One of those places is the U-Stop near Pine Lake Road and Highway 2.

More : https://www.klkntv.com/nebraska-corn-board-trying-to-get-more-people-to-use-ethanol/


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## hkskyline

*As Gas Prices Soar, Is Ethanol A Viable Option To Relieve Pain At The Pump? *
_Excerpt_
May 12, 2022

MINNEAPOLIS (WCCO) – Gas prices continue to rise in the Midwest.

We’ve seen well over $4 a gallon in some parts of the state. It has many drivers looking at alternative options, including ethanol.

Last month, President Biden announced expanded sales of E-15, a mix of 85% gas with 15% ethanol.

Another growing season is underway at Brian Thalmann’s farm near Plato, and he’s hoping for good fortune ahead- especially when it comes to corn.

“We are producing food and fuel from the same kernel of grain,” said Thalmann.

More : As Gas Prices Soar, Is Ethanol A Viable Option To Relieve Pain At The Pump?


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## hkskyline

*New Iowa law requires more ethanol in state’s gasoline*
_Excerpt_
May 18, 2022

PRAIRIE CITY, Iowa (AP) — Iowa is the first state in the nation to require most gas stations to sell fuel with at least 15% ethanol under a bill signed Tuesday by Gov. Kim Reynolds.

Reynolds signed the bill on a farm near Prairie City, about 20 miles east of Des Moines. The Republican governor signed the bill on a flatbed wagon backed by tractors and corn planters, highlighting what she called a victory for Iowa farmers and biofuels advocates.

The ethanol industry consumes about half of Iowa’s corn crop, and the state leads the nation in corn and ethanol production.

More : New Iowa law requires more ethanol in state's gasoline


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## hkskyline

*Explained: Why has Centre advanced its 20% ethanol blending target by five years? *
The Indian Express _Excerpt_
May 20, 2022

The Union Cabinet Wednesday advanced by five years its target for achieving 20% ethanol blending in petrol. The amended National Biofuel Policy-2018 has now set the new target for 2025-26 instead of 2030, apart from allowing more feedstock for production of biofuels and export of biofuels in specific cases. A closer look at the amendments and what they mean for the sugar industry.

Introduced in 2018, the National Biofuel Policy is aimed at reducing dependence on imports by encouraging fuel blending. With bioethanol, biodiesel and bioCNG in focus, its key parts include Ethanol Blending Programme (EPB), production of second generation ethanol (derived from forest and agricultural residues), increasing capacity for production of fuel additives, R&D in feedstock, which is the starting material for ethanol production, and financial incentives for achieving these goals.

More : Explained: Why has Centre advanced its 20% ethanol blending target by five years?


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## hkskyline

* EXCLUSIVE Biden administration likely to retroactively raise ethanol blending volumes for 2021, sources say*
_Excerpt_ 

June 1 (Reuters) - The Biden administration is likely to raise ethanol blending mandates for 2021 above the figure it proposed in December to align with actual U.S. consumption levels, according to two sources briefed on the decision.

In December, the U.S. Environmental Protection Agency proposed that refiners blend 13.32 billion gallons of ethanol into the fuel pool, a move that angered Farm Belt lawmakers and biofuel producers who said it was too low.

But recent federal figures show U.S. consumption of ethanol at about 13.94 billion gallons. The administration is now considering lifting the 2021 mandate to around that level, the sources said.

More : EXCLUSIVE Biden administration likely to retroactively raise ethanol blending volumes for 2021, sources say


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## hkskyline

* India's ambitious gasoline-ethanol blending plan has price, supply woes to overcome*
May 31, 2022
S&P _Excerpt_ 

Surging crude prices have prompted India to set an ambitious goal of achieving 20% ethanol blending in gasoline, a move analysts said could help to cut the ballooning oil import bill, although ensuring plentiful availability of the biofuel at viable prices would be a key challenge.

The recent pledge by New Delhi to advance the 20% blending target -- 20% ethanol and 80% gasoline -- by five years to fiscal year 2025-26 (April-March) from 2030 is the latest policy measure that India has announced to find ways to battle high oil prices that have pushed up the inflation rate to eight-year highs.

However, analysts said lifting the biofuel blending rate with gasoline from the current 10% to 20% in such a short span of time may be possible only in certain pockets of the country but not across the entire country.

More : India's ambitious gasoline-ethanol blending plan has price, supply woes to overcome


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## hkskyline

*POET hopes pipeline partnership will speed ethanol climate goals *
_Excerpt_

June 9 (Reuters) - POET LLC, the world's largest ethanol producer, said it hopes to meet some of its climate goals early as a result of a new partnership it announced this week with a Midwest carbon capture and storage (CCS) pipeline.

POET LLC's (PTBBU.PK) decision to partner with Navigator CO2 Ventures is a major boost for the pipeline project, which aims to capture greenhouse gases from Midwest ethanol processing plants and transport it to underground storage sites. 

POET had pledged in 2021 to make its biofuels 70% less emissions intensive than gasoline by 2030. But the Navigator partnership means participating plants will achieve 75% lower emissions, said President Jeff Lautt.

More : POET hopes pipeline partnership will speed ethanol climate goals


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## hkskyline

*How does ethanol blending in fuels aid India’s energy transition? | In Focus podcast *
The Hindu _Excerpt_
June 10, 2022

Dr. Charles Worringham speaks to us on the alternatives to ethanol and the path that India should adopt to satisfy its energy needs
Last week, the government announced that India had met the target of 10% ethanol blending with motor fuel ahead of time. The target for 20% blending had earlier been brought forward to 2025 from 2030.

But is this the path that India should choose? Are there better alternatives to ethanol? What is the downside to the use of ethanol?

More : How does ethanol blending in fuels aid India’s energy transition? | In Focus podcast


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## hkskyline

*India expands biofuel tax benefit for ethanol and vegoils *

NEW DELHI, July 5 (Reuters) - India has expanded the excise duty exemption for biofuels to encourage the blending of higher proportions of ethanol and components of vegetable oil with gasoline and diesel, a government order said.

More : India expands biofuel tax benefit for ethanol and vegoils


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## hkskyline

* Brazil's most populous states cut local taxes on ethanol* 
_Excerpt_

SAO PAULO, July 18 (Reuters) - The governments of Sao Paulo and Minas Gerais, the two most-populous Brazilian states, on Monday cut local taxes on ethanol, a move followed by Parana state, in a bid to make the biofuel more competitive at the pump after a similar gasoline tax cut.

Sao Paulo cut the ICMS tax, similar to a value-added tax, on ethanol to 9.57% from 13.3%, while Minas Gerais reduced it to 9% from 16%, and Parana decreased it to 12% from 18%.

The states' moves come after Congress last week mandated reinstating a tax advantage to biofuels compared with fossil fuels in Brazil, an effort to alleviate double-digit inflation boosted by high energy prices ahead of general elections in October. read more

More : Brazil's most populous states cut local taxes on ethanol


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## hkskyline

* Oil costs spur India to produce ethanol from farm waste *
_Excerpt_ 

PANIPAT, India, Aug 10 (Reuters) - India opened its first factory to produce ethanol from rice straw or stubble on Wednesday as part of measures to reduce its reliance on oil imports and meet its net zero carbon goal.

Prime Minister Narendra Modi said the project will help cut pollution in India's capital New Delhi, which has been blanketed by smog from stubble burning in recent winters, as well as in the northern states of Haryana and Punjab.

India, one of the world's biggest emitter of greenhouse gases, has set a 2070 goal for net zero carbon emissions and has expedited steps to switch to cleaner energy to cut projected emission by a billion tonnes by 2030.

More : Oil costs spur India to produce ethanol from farm waste


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* Explained: What is ethanol blending and why is it important? *
The Hindustan Times _Excerpt_
Aug 20, 2022

Addressing the nation from the ramparts of the Red fort on 76th Independence Day, Prime Minister Narendra Modi said that India has reached the target of 10 per cent sugarcane-extracted Ethanol blending with petrol earlier of its schedule. The target attained in June has motivated the government to advance the target of 20 per cent blending by five years, to accomplish by 2025.

Ethanol mixing is said to reduce environmental degradation while adding extra income to the pocket of farmers. It will help India achieve its dream of self-reliance in the energy sector. Here we chalk down the prominent points about the emerging technology.

What is Ethanol blending ?
Ethanol (also called ethyl alcohol, or alcohol) is a biofuel with chemical formula C2H5OH. It is naturally made by the fermentation of sugar. In India, it is largely derived while extracting sugar from sugarcane. However, other organic matter like food grains can also be used for its production.

More : Explained: What is ethanol blending and why is it important?


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* Explore potential of ethanol as substitute for fossil fuels, urges Minister *
New Straits Times _Excerpt_
August 25, 2022

Government entities have been urged to explore the potential of ethanol as a substitute for fossil fuels in Indonesia.

State-Owned Enterprises Minister, Erick Thohir, said this in a meeting with the Commission VI of the House of Representatives (DPR) on Wednesday, as reported by Antara news.

"We are encouraging PTPN Holdings (state-owned plantation company Perkebunan Nusantara) to increase and allocate (their products) for sugar and for ethanol. We know that various countries, such as Brazil and India, have pushed ethanol as a substitute for vehicle fuels," Erick said.

More : https://www.nst.com.my/world/region...thanol-substitute-fossil-fuels-urges-minister


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* Nitin Gadkari’s ethanol push — a many-sided story *
CNBC TV18 _Excerpt_
Aug 30, 2022

Union Minister for Road Transport and Highways Nitin Gadkari has been emphasising the need to switch from hydrocarbon fuels to ethanol-blended fuels, highlighting how the government is making an effort to introduce ethanol in construction and agriculture equipment.

"Alternative fuel is the future," news agency PTI had quoted Gadkari as saying in the past.

On Sunday, August 28, he reiterated the same at the 61st convention of automakers body Society of Indian Automobile Manufacturers (SIAM). Speaking at the convention, the Union minister urged automakers to start making flex engines, which could run on fossil fuel or ethanol. At the same time, he said the government would set up ethanol filling stations within six months in the country.

More : Nitin Gadkari’s ethanol push — a many-sided story


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* Expect to save at the pump: 44 Minnesota gas stations to expand ethanol options after receiving grant *
CBS _Excerpt_
Sept 30, 2022

More Minnesotans can expect to save money soon thanks to a new grant that will expand ethanol options at gas stations across the state, the Minnesota Department of Agriculture announced Friday.

The grant awards over $6.4 million to 44 service stations to offset the cost of investing in upgraded petroleum dispensers, fuel storage tanks, and other equipment compatible with higher ethanol blends.

"These grants help the local economy by giving drivers more economical options at the gas pump and increasing access to homegrown fuel that comes from Minnesota farmers," said Agriculture Commissioner Thom Petersen.

More : Expect to save at the pump: 44 Minnesota gas stations to expand ethanol options after receiving grant


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*Europe Is Buying Up Cheaper Brazilian Ethanol Amid Energy Crisis*
Bloomberg _Excerpt_
Oct 19, 2022

Europe is loading up on cheaper Brazilian ethanol, tripling imports in order to cope with the energy crisis triggered by the war in Ukraine. 

Prices for natural gas and power are so high in Europe that some ethanol makers have considered shutting down plants. As in other countries, it’s a requirement that ethanol be blended with gasoline in Europe. Luckily, Brazil is stepping in with a more affordable alternative, which could bring down the cost of driving.

Brazilian ethanol shipments to Europe through September were three times higher than the previous year. The buying binge especially took off starting in July after a policy change caused biofuel prices to plunge in Brazil. 

More : Europe Is Buying Up Cheaper Brazilian Ethanol Amid Energy Crisis


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*EPA seeks to mandate more use of ethanol and other biofuels *
_Excerpt_ 
Dec 2, 2022

MINNEAPOLIS (AP) — The Environmental Protection Agency on Thursday proposed increasing the amount of ethanol and other biofuels that must be blended into the nation’s fuel supplies over the next three years, a move welcomed by renewable fuel and farm groups but condemned by environmentalists and oil industry groups.

“This proposal supports low-carbon renewable fuels and seeks public input on ways to strengthen the program,” EPA Administrator Michael S. Regan said in a statement. “With this proposal, EPA seeks to provide consumers with more options while diversifying our nation’s energy mix.”

The proposal also includes new incentives to encourage the use of biogas from farms and landfills, and renewable biomass such as wood, to generate electricity to charge electric vehicles. It’s the first time the EPA has set biofuel targets on its own instead of using numbers from Congress. The agency opened a public comment period and will hold a hearing in January.

More : EPA seeks to mandate more use of ethanol and other biofuels


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*India preparing to launch 20% ethanol with gasoline - oil minister *
_Excerpt_
Dec 16, 2022 

NEW DELHI (Reuters) - India is preparing to launch sales of 20% ethanol with gasoline and will look to gradually raise its share of the cleaner fuel in its energy mix, the country's oil minister Hardeep Singh Puri said on Friday.

India currently mixes 10% ethanol with gasoline, but the world's third-biggest oil importer and consumer is keen to cut its carbon footprint to aid Prime Minister Narendra Modi's goal for net zero carbon emissions by 2070.

More : India preparing to launch 20% ethanol with gasoline - oil minister


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*Commodities 2023: Ethanol plants in US to face hard choices *
S&P _Excerpt_
Dec 19, 2022

For the US ethanol market, 2023 could have a rough start.

Facing dropping winter temperatures and falling demand for ethanol for blending, many ethanol plant operators face a tough choice. Do they keep churning out the biofuel, losing money, or shut down the plant and risk losing more?

"You can run and lose $12 million a month, or you can shut down and lose $15 million a month," said a broker familiar with the logistics of running a plant.

Furthermore, the cold, blustery winters typical of the Midwest, where the bulk of the nation's ethanol plants are located, pose substantial risks to the plants. A plant must be heated during the winter to protect against freezing temperatures, regardless of whether it is producing ethanol.

More : Commodities 2023: Ethanol plants in US to face hard choices


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