Robust Livestock Sector Important for Ethanol Industry

The ethanol industry and livestock production can not only coexist but can benefit each other.

“Many communities in Nebraska want an ethanol plant for the jobs and economic vitality it brings, but livestock producers, particularly cattle producers, see the plant as another source for feed,” said Randy Klein, director of market development with the Nebraska Corn Board.

In fact, Klein said, distillers grains are a versatile feed ingredient that can lower the cost of production for cattle producers. “Distillers grains have outstanding nutritional properties for cattle and can be mixed into normal rations, combined with lower-cost forages to make a great feed or even simply dumped onto cornstalk stubble for foraging cattle,” he said. “In each case, cattle performance improves and costs go down.”

Robust Livestock Sector Important for Ethanol Industry

September 2007 Ethanol Production Up

The Renewable Fuels Association reported that September 2007 ethanol production continues to grow averaging 441,000 barrels per day. Demand fell to 422,000 barrels per day.

Ethanol production continued to grow in September, averaging 441,000 barrels per day (b/d) according to the Energy Information Administration.

Ethanol demand, despite the economic advantage ethanol had over gasoline, fell to 422,000 b/d representing a monthly decrease from August of 54.2 million gallons.

It is no surprise that production is up since many new plant constructions and expansions are going on, but for demand to fall is somewhat puzzling given the fact that the wholesale price of ethanol is lower than the wholesale price of gasoline.

“Despite the economic advantage ethanol blending offered refiners, and most importantly consumers, the actual blending of ethanol decreased.

"With ethanol-blended fuels offering the opportunity to save consumers up to 10 cents a gallon at the pump, it is baffling why more gasoline blenders were not blending more ethanol.”

Renewable Fuels Association Releases September 2007 Ethanol Production and Demand

Area farmer feeds hogs ethanol byproduct

This is an interesting story our of South Dakota where a hog farmer is feeding Distillers Dried Grains (DDGs).

"Health. I keep coming back to health."

Those are the words Mission Hill hog farmer Ray Epp uses to describe his motivation for incorporating dry distiller grains (DDGs) into the feed rations for his 1,200-head pig-to-finishing operation six years ago.

Epp, who uses some of his own corn crop in the ground feed mixture he uses for his hogs, says the use of 10 percent or 20 percent distiller grain ration in his feed has improved the health of his pigs by at least 50 percent.

He goes on to say that the hogs also gain weight quicker, finish out faster and allows him to feed less corn which saves him money.

Area farmer feeds hogs ethanol byproduct

Turning Glycerin Into Gold

Glycerin is the byproduct of making biodiesel. For every gallon of biodiesel made you get about 1/10 of a gallon of glycerin. Biodiesel manufacturers have always depended on the value derived from the sale of glycerin to make the overall economics of production worthwhile. And although glycerin is used in many products, as biodiesel production has increased the amount of glycerin has also increased, creating an oversupply situation and lowering the value of glycerin. Add to that the rising costs of feedstocks and biodiesel manufacturers have seen profit margins decreasing.

Two processes have been in the news lately which may allow producers to process glycerin into higher value products.

Turning a Glycerin Glut Into Ethanol Helps Biofuel Industry

Generating Hydrogen From Biodiesel Waste

E85 and C.A.F.E. Standards

I have heard it said that the only reason the automakers make flex fueled vehicles is to satisfy their Corporate Average Fuel Economy (CAFE) standards. Well, let's look at that a little closer.

The CAFE system is run by the National Highway Traffic Safety Administration (NHTSA) and if you aren't very familiar with it, you might want to read their CAFE Overview.

Under CAFE flex fueled vehicles are given special consideration. Using an example from the overview, a flex fueled vehicle that gets 25 mpg on gasoline would be calculated to get 40 mpg. This is where the argument comes in that flex fueled vehicles are skewing CAFE numbers for the manufacturers. You can imagine all those flex fuel SUVs running around being counted against CAFE as if they were economy cars. But the CAFE rules have a maximum increase of .9 mpg attributable to flex fueled vehicles.

According to Cars.com for the 2006 model year GM's domestic car fleet averaged 29.2 mpg. The CAFE standard for car fleets is 27.5 mpg. Since GM's average of 29.2 mpg is higher than the standard of 27.5 mpg by more than .9 mpg, flex fueled vehicles did nothing in 2006 to help GM reach their CAFE requirements on their domestic car fleet.

It should also be noted that flex fueled vehicles may not have increased GM's numbers by the whole .9 mpg. As far as I know there isn't any place to go to find out exactly how much flex fueled vehicles helped the overall numbers for the manufacturers. So Ford with a domestic car fleet average of 28.2 mpg or .7 mpg higher than the standard may or may not have made it without the credits from flex fueled vehicles.

Of course in 2006 GM built flex fueled cars even though they didn't need the numbers to meet the standards. And they continued to do so in 2007 and 2008. Even though they don't need to from a CAFE perspective.

So the next time that you hear that the only reason manufacturers make flex fueled vehicles is to get around CAFE requirements you will know that that is not always the case.