Ethanol — Alive And Growing

Ethanol Storage Tanks

In the face of great challenges — and in response to even greater needs — the U.S. ethanol industry is growing and evolving. In 2008, the U.S. ethanol industry withstood a deepening recession, with unemployment increasing by 2.3 percentage points and the economy contracting by more than 2.5%, as well as a credit crisis and rising energy costs. In spite of all this adversity, the industry grew by 34%, opening 31 new plants, creating an additional 240,000 jobs, producing a record 9 billion gallons of ethanol, and developing the capacity to turn out 12 billion gallons.

This year, several ethanol facilities that had been idled have returned to production — some under new ownership and others because economic factors are once again favoring ethanol. The industry expects to produce 10.5 billion gallons of ethanol, setting another record and accounting for more than 8% of the nation’s gasoline supply.

Changing Times, Steady Needs

Even as times have changed since the first drop of ethanol was produced, the reasons underpinning our need for renewable fuels remain.

Energy security remains a crucial concern for our country. In 2001, when terrorists attacked the World Trade Center and the Pentagon, the U.S. imported 4.3 billion barrels of petroleum, including 2 billion from OPEC nations. Last year, we imported 4.7 billion barrels, including 2.2 billion from OPEC nations, among them Mahmoud Ahmadinejad’s Iran and Hugo Chavez’ Venezuela.

Currently, domestic ethanol displaces more than 320 million barrels of imported oil a year, saving taxpayers some $16 billion annually. That’s a start towards weaning America away from its addiction to imported oil from unfriendly governments in unstable parts of the world.

Similarly, ethanol serves another national purpose: Reducing pollution and greenhouse gas emissions. Last year, the production and use of 9 billion gallons of ethanol in the U.S. reduced carbon dioxide greenhouse gas emissions by approximately 14 million tons — the equivalent of removing 2.1 million cars from the road. That’s another encouraging start towards another important goal.

Meanwhile, expanded ethanol production promotes a third great goal — economic growth that creates “green jobs.” Many of the new plants are in rural areas or small factory towns where factories are closing down and Main Streets are fading away. Now, the ethanol industry is offering opportunities for growers to find markets for their crops and for workers to find good-paying jobs. Many of these positions are for professionals and technicians with training in biology, chemistry, mathematics, engineering, accounting, and business management, so that college graduates won’t have to leave home.

On Capitol Hill

In Washington, many of the concerns ethanol production and use help address are at the top of the legislative agenda.

Because ethanol serves so many national goals, President Barack Obama has put USDA in charge of a program to promote the American biofuels industry, working with the Department of Energy and EPA. This Biofuels Interagency Working Group is helping to refinance ethanol and biodiesel factories that have been caught in the credit crunch. The working group is also seeking new ways to guarantee loans to build new biorefineries and to provide funding for producers of ethanol from cellulose and other sources.

Meanwhile, the ethanol industry is raising its voice on other important policy issues. Passed in 2007, the Re­newable Fuel Standard continues to drive ethanol sales. This year, the standard requires the use of 11.1 billion gallons of renewable fuels — ethanol, biodiesel, and other advanced biofuels. That figure jumps to about 13 billion in 2009, about 14 billion in 2010, and about 15 billion in 2011. This will provide our industry with an unequivocal and growing demand base.

As the volumes of renewable fuel mandated by the standard continue to expand, we are bumping up against the “blend wall” — the requirement that every gallon of gasoline be blended with ethanol at a 90/10 ratio. At the Renewable Fuels Association, we are working with colleagues in the industry and decision makers in Washington, DC, to increase the amount of ethanol that can be blended in conventional gasoline. Based in part on conversations with Obama Administration officials, we believe that EPA has the authority to move immediately to ethanol blends of 12% or 13% without adverse impacts on automobiles or air quality.

Such a move can occur while EPA reviews the merits of a formal waiver allowing ethanol blends of 15% — “E15.” It will provide gasoline refiners and marketers the flexibility to maximize ethanol blending while higher blend levels are explored and the infrastructure to dispense them is created.

As is often the case, the success of this industry has drawn the ire of industries that seek to maintain the status quo. Such a position is simply untenable, and the misinformation spread about ethanol must be met head on with the facts.

Often, we’re told that producing ethanol from grains decreases food supplies and increases food prices. But the fact is: American growers are the most productive the world has ever known. Last year, even with the 34% increase in U.S. ethanol production, growers produced the second largest corn crop on record, increased exports, fed more livestock than ever, and increased the amount of corn leftover from the year before. This was done, not by plowing up every acre but by harnessing the power of innovation — increasing corn yields by 400% since World War II — while planting the same number of acres.

The harvest currently underway may be the largest ever. Again, this unprecedented productivity comes against a backdrop of steadily increasing ethanol production and use.

The second big lie is that increased ethanol production in the U.S. is causing land use change in Africa and South America. But deforestation changes in land use are being caused by illegal logging practices, cattle ranching, and subsistence farming, not by a growing market for biofuels. In fact, deforestation has decreased as ethanol production has increased over the past several years.

Fortunately, there are vast amounts of arable land available for agriculture throughout the world. As the Food and Agriculture Association of the United Nations has reported, there are 1.5 billion hectares of land used for arable and permanent crops — about 11% of the world’s area. But there are 2.8 billion hectares of unused land suitable for agriculture — almost twice as much land as is currently being farmed.

Future Needs

As much as we must focus on the tasks at hand, America’s ethanol producers are also setting their sights on the opportunities the future will hold.

Soon, there will be 3 billion cars on the road around the world, driving global oil consumption from 86 million to about 120 million barrels a day. The Earth doesn’t have that much oil, so the world will need renewable biofuels.

We can meet rising worldwide demand with the next generation of ethanol. U.S. ethanol producers are rapidly developing and commercializing technologies that use new feedstocks in addition to grain. These feedstocks include wood chips, corn cobs, native grasses, and plain old garbage.

But, just as with any new generation, the new generation of ethanol needs an older generation before it. Grain ethanol gives rise to the companies, the infrastructure, the trained and skilled workforce, the markets, the vehicles, and even the public policies that are so essential for next-generation ethanol technologies. As President Obama has said, the “transition to (the next generation) will be successful only if the first-generation biofuels industry remains viable in the near term.”

We can — and must — feed the world reliably and fuel our nation renewably. Together, American agriculture and the American ethanol industry are helping get the job done.

Topics:

Leave a Reply

Crop Inputs Stories

Crop InputsPlatform Specialty Products To Acquire Arysta LifeScience
October 20, 2014
Once the acquisition is complete, Platform Specialty Products will combine Arysta LifeScience with previously acquired companies Agriphar and Chemtura Crop Solutions. Read More
MicronutrientsMicronutrients Going Macro
September 9, 2014
Between 2014’s fantastic growing conditions and a heightened awareness on plant nutrition, the major players in micronutrients are gearing up for another big year. Read More
FertilizerFall Fertility 2014: Forecasting Fertilizer Use
September 7, 2014
Great crops this year have tapped the soil, and fall work is definitely called for, but how challenging will that get? Read More
FungicidesSudden Death Syndrome, Brown Stem Rot Reported In Indiana Soybeans
September 3, 2014
Farmers and retailers should be watching for symptoms of these two diseases over the next few weeks as they are best managed through preventative methods. Read More

Top 100 Articles

CropLife 100CHS: Driving Momentum To Help Farmer-Owners Grow
December 11, 2014
CHS Inc., the nation’s leading farmer-owned cooperative and a global energy, grains and foods company, must capture new opportunities to Read More
CropLife 100BRANDT, Verdesian Ink Distribution Agreement
December 9, 2014
The agreement grants BRANDT the exclusive right to sell and market Verdesian’s patented Steric chemistry in the Turf and Ornamental and eastern U.S. ag markets under the BRANDT Reaction product line name. Read More
CropLife 100CropLife 100: The Colors Of Custom Application
December 5, 2014
Although many color spray rigs are in the yards of the nation’s top ag retailers, the majority of them still come in only a few shades. Read More
CropLife 100Pinnacle Invests In Meridian Agriculture Distribution
December 4, 2014
Meridian will provide retailers with supplier-branded products and numerous opportunities to differentiate themselves from their competitors. Read More
CropLife 100CropLife 100: Entering A New Seed Era
December 4, 2014
The seed category has been re-vitalized during the past few years, and more good news (and varieties) are headed the industry’s way in 2015. Read More
CropLife 100CropLife 100: The Depressed State Of Fertilizer
December 3, 2014
Following downright giddy growth earlier this decade, fertilizer sales have fallen back down to earth the past two years. Read More

Latest News

Crop InputsNufarm Fills Regulatory VP Position
December 18, 2014
Nufarm announced today that Rob Schwehr has been promoted to the position of Vice President of Innovation & Regulatory Affairs for Nufarm Americas. Read More
Seed/BiotechReport: China Approves Viptera Corn, U.S. Officials Awa…
December 17, 2014
Chinese authorities have informed some agriculture industry officials the government has approved U.S. imports of a type of genetically modified corn developed by Syngenta. Read More
FertilizerMonty’s Plant Food Brings In New Sales Rep
December 16, 2014
Monty's Plant Food Company has hired Warren Kearns as its newest Sales Representative for the South Carolina area. Read More
EquipmentHagie Wins 2014 CropLife IRON Product Of The Year Award
December 15, 2014
The self-propelled sprayer maker has a hit on its hands with the new STS Series model. Read More
Syngenta
Seed/BiotechSyngenta Sees China Approving Contentious GMO Corn Soon
December 15, 2014
Syngenta will make an announcement when it receives official documentation from China that Agrisure Viptera corn, known as MIR 162, has been cleared for import. Read More
Crop InputsVerdesian Life Sciences Names Vice President Of Communi…
December 15, 2014
Amy Bugg will oversee the execution of all promotional strategies for the corporate brand and the complete product portfolio. Read More
StewardshipFarmers, Retailers Attend 4R Certification 4U Workshop
December 15, 2014
More than 160 farmers and ag retailer attended the “4R Certification 4U” workshop December 12 to learn more about the 4Rs of nutrient stewardship, water quality research in the area and cost-sharing opportunities. Read More
Matt Hopkins10 Best New Agriculture Apps For 2015
December 15, 2014
These new agriculture apps are certain to help ag professionals do their jobs more efficiently in 2015 and beyond. Read More
ManagementARA Learnings, Retail Buying Intentions: Welcome To Cro…
December 12, 2014
This informal video program puts news and events effecting retailers into context, and features Editors Paul Schrimpf and Eric Sfiligoj. Read More
Seed/BiotechMonsanto Herbicide-Tolerant Technology Closer To Commer…
December 12, 2014
The final EIS moves Monsanto one step closer to the introduction of Bollgard II XtendFlex cotton and Roundup Ready 2 Xtend soybeans, paving the way to provide access to dicamba-tolerant soybeans and cotton. Read More
Seed/BiotechUSDA Issues Final Environmental Impact Statement On Her…
December 12, 2014
The USDA Animal and Plant Health Inspection Service (APHIS) is issuing a final environmental impact statement on varieties of cotton and soybeans that have been genetically engineered for resistance to several herbicides, including the one known as dicamba. Read More
CropLife 100CHS: Driving Momentum To Help Farmer-Owners Grow
December 11, 2014
CHS Inc., the nation’s leading farmer-owned cooperative and a global energy, grains and foods company, must capture new opportunities to Read More
LegislationARA Applauds CFATS Passage Prior To Holiday Adjournment
December 11, 2014
The streamlined bill provides a four-year authorization of the CFATS program and guidance to DHS on key issues of chemical facility security Read More
Seed/BiotechBayer CropScience’s ILeVO Approved By EPA
December 11, 2014
EPA has approved ILeVO, the only seed treatment that protects the root system against infections caused by the Sudden Death Syndrome fungus and has activity against dangerous nematodes. Read More
Biologicals in Emerging Markets Map.
Crop InputsBiocontrols Could Quadruple By 2025; Will Regulators Pl…
December 11, 2014
The European experience with GMOs offers caution — and a promise — for biologicals. Read More
Crop InputsBASF Donates $75,000 To Feeding America
December 10, 2014
The donation will support Feeding America’s National Produce Program, an initiative that helps with planning, transportation and logistics to ensure fresh produce deliveries to the 200 member food banks around the country. Read More
InsecticidesHow To Avoid Aphid Infestation In Winter Wheat
December 10, 2014
The best strategy for managing aphid infestations in winter wheat — and the potential yellow dwarf diseases that they transmit — is prevention, according to a South Dakota State University Plant Pathology field specialist. Read More
LegislationDufault Installed As New ARA Chair
December 10, 2014
Dave Dufault, Vice President and General Manager of J.R. Simplot Company's Retail Business, was installed as the 2015 Chairman of the Board for ARA on December 4. Read More