Cattle superfeed proposed; distillers grains part of the “supermix”
March 28, 2008
A cattle superfeed was proposed in the pages of Farm and Ranch Guide. Advocates are saying that superfeeds will allow farmers to compete better in international markets. One of the proposed feedstocks are dry distillers grains from ethanol production, but limited to 30 percent of the overall product.
Indonesia slaps 20 percent export duty on crude palm oil
March 28, 2008
In Indonesia, the central government imposed a 20 percent tariff on export of crude palm oil, in an attempt to reduce prices in local Indonesia markets. The taxes will be imposed as of April 1, with the base price of CPO increasing to $1196 per tonne. The country has been beset by palm oil inflation caused by rising prices of the commodity.
Leaf Clean Energy injects $20 million to expand Greenline Industries
March 28, 2008
In California, Leaf Clean Energy has invested $20 million in Greenline Industries, to facilitate expansion of Greenline’s R&D effort. Leaf Clean, a publicly-traded investment company, said that it expect to complete its investment phase in December 2008 and is shortlisting another 23 companies for potential investments.
North Carolina biofuel meltdown as all but two development projects closed down
March 28, 2008
In North Carolina, only two biofuel projects are still moving forward after a series of cancellations due to financing issues have stymied North Carolina’s drive for biofuels leadership. The Clean Burn Fuels 100 Mgy corn ethanol plant and a small ethanol plant in Robeson County by Solv-It Technologies are still in progress, while Xethanol, East Coast Ethanol, and Agri-Ethanol all canceled projects due to inability to raise funds. Last August, Virgina Atlantic sued Agri-Ethanol over a $209,000 loan.
Today in Biofuels: Shell ventures into biogasoline; US corn exports up 6 percent in ‘07 in food vs. fuel surprise; India condemns Western ethanol policies, doubles ethanol requirement
March 27, 2008
Top Story:
In the Netherlands, Royal Dutch Shell and Virent Energy Systems announced a 5-year partnership to make biogasoline from a catalytic process from biomass. The Virent Bioforming process uses undisclosed catalysts to convert plant-based sugars into gasoline-resembling hydrocarbons, instead of fermenting into ethanol The process uses non-food feedstocks. Shell did not disclose their investment in the project, but indicated that a demonstration plant for the technology was planned for 2010. Shell biofuel spokesmen said that biogasoline could use existing gasoline infrastructure for marketing and distribution, and that they expected biofuels to provide 10 percent of the global fuel supply by 2030.
Producer News:
In Iowa, Red Rock Renewables won approval for its 110 Mgy corn ethanol plant proposed for a site near Pleasantville. Opponents had criticized the plant’s location, traffic impact , safety plan, and potential for pollution as well as raising issues with water usage. Construction is expected to star later this year.
In Kansas, Orion Ethanol acquired a Texas wet milling plant from Dimmitt Ethanol. The purchase price was $2.5 million. Orion plans to convert the facility to ethanol production, with a total cost of the project estimated at $66 million, compared to more than $130 million for construction of a new dry milling ethanol facility. Orion’s project includes the construction of 60 Mgy of ethanol capacity, a 10 Mgy edible oil extraction plant, a 10 Mgy cellulosic ethanol plant, a 12 Mgy biodiesel facility, and up to 75 MW in wind and methane capacity.
A top engineering executive said that, based on a recently completed US roadshow with 15 major ethanol-related lenders, ethanol development is “dead” until 2009 at the earliest. Bateman Litwin CEO Shuki Raz told Reuters that financing issues and high feedstock prices were the concerns influencing the drying up of capital.
International News:
In India, Petroleum and Natural Gas Minister Murli Deora said that the national government would raise the required ethanol content in gasoline from 5 percent to 10 percent in October. Meanwhile, Indian Finance Minister P Chidambaram, speaking at a conference in Singapore, called the policies of developed nations converting food into fuel “outrageous and must be condemned” and that the world’s poor are feeling the impact of higher food prices. “It is a sign of the lopsided priorities of certain countries that they will resort to measures that will produce fuel at a cheaper cost in order to meet the transport requirements of a section of their population,” he said. He did not offer comments on India’s rapidly expanding capacity to do the same thing.
In Canada, Investeco Capital said that they would invest in cellulosic ethanol producer Woodland Biofuels of Ontario. Investeco said that Woodside’s Catalyzed Pressure Reduction technology have it a material advantage over other cellulosic ethanol producers as well as first-generation biofuels. Woodside recently received $9.8 million from Sustainable Development Technology Canada towards the cost of its demonstration plant, but Investeco’s capital infusion was not disclosed.
In Sweden, Svenska Statoil said that E85 sales increased 180 percent in February over the corresponding period in 2007, to 1.26 million gallons. Sales increased by 4 percent over January 2008. The company operates 280 ethanol stations in Sweden, offering E5 and E85 blends.
Research News:
The Ethanol Promotion and Information Council responded to recent report in a Florida newspaper that US ethanol production had led to Haitian villagers being forced to eat mud pie. In its response, EPIC noted that US corn exports in 2007-08 market year were 2.25 billion bushels, 6 percent more than in 2006-07 and the highest since 1990, and that the largest increase in sales went to Mexico, “one of the very nations that we are supposedly starving to death.” EPIC also noted that US ethanol subsidies, totaling $3 billion, have resulted in a $6 billion reduction in crop price supports and a $15 billion drop in US oil imports. EPIC said that the true reason for rising food prices was rising labor, packaging and fuel costs, and rising wealth and demand from China and India.
Policy and Policymakers:
In California, Pacifica ratified the US Mayors’ Climate Protection Agreement. The agreement, developed by the U.S. Conference of Mayors, includes commitments by US cities and towns to: measure carbon footprints, set emission reduction targets, promote energy efficiency, promote sustainable building practices, increase fuel efficiency in municipal fleets and convert diesel vehicles to biodiesel, and increase recycling rates.
Consumer and Fleet News:
The National Biodiesel Foundation announced the BioTrucker Fuel Card, which gives the cash price (or a discount of up to $0.02) and a waiver on fuel transaction fees at 149 truck stops around the country that sell biodiesel.
In Canada, Student Transportation of Canada will convert 235 of its 1,000 school bus fleet of 1,000 buses to biodiesel. The blend ratio was not disclosed but the company said it expected to generate emission reductions of up to 40 percent from the conversion. STC is the fourth-largest school bus fleet in North America with a total fleet of 5,000 buses and school vehicles in the US and Canada.
Financial News:
The Biofuels Digest Indexâ„¢ (BDI), a basket of public biofuels stocks, fell 0.53 percent to close at 117.53 as weakness in larger caps overshadowed a broader advance. For the day, Archer Daniels Midland (ADM) fell 0.75 percent to close at $42.38. Among ethanol stocks VeraSun Energy (VSE) gained 2.10 percent to close at $7.77, while Pacific Ethanol (PEIX) lost 1.09 percent a week before dismal quarterly earnings are expected. Along small caps, Nova Biosource Fuels (NBF) gained 9.42 percent, to $1.51. Overall, advances led declines 6 to 1.
Shell, Virent Energy Systems form 5-year partnership to make biogasoline; demo plant in 2010; increases momentum of biocrude, biogasoline trend
March 27, 2008
In the Netherlands, Royal Dutch Shell and Virent Energy Systems announced a 5-year partnership to make biogasoline from a catalytic process from biomass. The Virent Bioforming process uses undisclosed catalysts to convert plant-based sugars into gasoline-resembling hydrocarbons, instead of fermenting into ethanol The process uses non-food feedstocks.
Shell did not disclose their investment in the project, but indicated that a demonstration plant for the technology was planned for 2010. Shell biofuel spokesmen said that biogasoline could use existing gasoline infrastructure for marketing and distribution, and that they expected biofuels to provide 10 percent of the global fuel supply by 2030.
The current energy-transportation system “has been a hundred years and billions of dollars in the making,” Rick Zalesky, vice president for biofuels and hydrogen at Chevron’s alternative-energy arm told the Wall Street Journal. “The ideal outcome of our research is to develop biomass-based transportation fuels that have chemical properties similar to those of gasoline and diesel,” he said. The profile covers efforts by Chevron, BP, Marathon, ConocoPhillips, and Shell to produce a viable alternative to petroleum that can utilize the existing oil company infrastructure.
Growing popularity of biocrude
The popularity of biocrude, or synthetic crude oil, has been increasing rapidly in recent months as policymakers and investors struggle to solve the increasing infrastructure and land-use issues of first-generation biofuels and feedstocks.
“By using waste, [it] overcomes the food versus fuel debate which surrounds biofuels generated from grains, corn and sugar,†says Dr. Stephen Loffler of CSIRO, Australia’s national science laboratory. CSIRO recently announced the development of a second-generation biocrude process, in conjunction with researchers at Monash University.
The announcement last month by Sustainable Power and Borneo Oil to develop 20 bioreactors in Malaysia is the most significant international expansion announced to date in biocrude production. Startup companies such as LS9, UOP, Syntroleum and the LiveFuels consortium have firmly entrenched themselves as the second wave of biocrude development, behind Sustainable Power.
“It’s a trend,” said Will Thurmond, author of Biodiesel 2020, and a leading authority on global biomass development. “The Chinese, among others, see biocrude as a 1.5 generation biofuel that, gets us out of many of the problems associated with first generation fuels, and while we are waiting for second-generation fuels like cellulosic ethanol.”
Numerous entrants into biocrude development
The LiveFuels consortium “is a national alliance of labs and scientists dedicated to transforming algae into biocrude by 2010″, according to the consortium’s website. The scientific alliance will be led by Sandia National Laboratories, a U.S. Department of Energy National Laboratory. The alliance is expected to sponsor dozens of labs and hundreds of scientists by the year 2010.
“We believe Sandia has the strengths needed to lead the alliance in its early growth phase,†said Lissa Morgenthaler-Jones, CEO of LiveFuels. “Sandia is a DOE laboratory managed by the National Nuclear Security Administration (NNSA), and possesses expertise in process engineering, biocience and biotechnology. Sandia is also home to the DOE Combustion Research Facility, a unique science and engineering user facility which can test the combustion characteristics of the biocrude produced by the LiveFuels alliance.â€
LS9 was cofounded by molecular geneticists Dr. George Church of Harvard University and Dr. Chris Somerville of the University of California. LS9’s technology uses designer enzymes to convert fatty acid intermediates into petroleum replacement products via fermentation of renewable sugars. LS9 was recently honored at the World Economic Forum in Davos, Switzerland for its work in biocrude.
UOP, a division of Honeywell, announced last June that it expected to develop military aviation jet fuel, using a synthetic biocrude made from algae. The UOP project is backed by $6.7 million in funding from the Defense Advanced Research Projects Agency (DARPA). UOP is working with Honeywell Aerospace, Cargill, Arizona State University, Sandia National Laboratories and Southwest Research Institute on the project.
The National Renewable Energy Labortatory (NREL), in Golden, Colorado, re-started its algae research project last October in partnership with Chevron, although it is not clear whether NREL will explore biocrude as an alternative to algae-based biodiesel. NREL ran an project exploring the development of biodiesel from algae between 1978 and 1996.
ConocoPhillips and Archer Daniels Midland Company announced last September that they would collaborate on the development of renewable transportation fuels from biomass. The ConocoPhillips process— similar to one under investigation by Neste Oil, converts oils and fats to a synthetic, hydrocarbon diesel fuel that burns cleaner and has a reduced aromatic content than conventional diesel, but meets existing specifications for the fuel. ConocoPhillips also funded an eight-year, $22.5 million research project at Iowa State University, with a focus on conversion of biomass to fuel through fast pyrolysis.
US ethanol development is dead until 2009, says exec after 15-bank tour
March 27, 2008
A top engineering executive said that, based on a recently completed US roadshow with 15 major ethanol-related lenders, ethanol development is “dead” until 2009 at the earliest. Bateman Litwin CEO Shuki Raz told Reuters that financing issues and high feedstock prices were the concerns influencing the drying up of capital.
Ethanol Producer has released its updated list of 118 proposed US ethanol projects with a total of 8 billion gallons in planned capacity. The directory of projects in planning, development or construction includes details on ownership and capacity for each proposed project.
Late last year, entrepreneur Carlo Bakker has launched a global database of biofuel plants, called worldbioplants.com. The website includes information on 906 biofuel plants, including 549 ethanol plants and 357 biodiesel plants in 51 countries.
The increase in biofuel plants and fuel outlets has prompted a number of entreprenurial ventures into biofuels information services. NearBio.com and neare85.com recently offered Biofuel Fuel Route Wizard for mobile and desktop users. A new print directory of E85 stations has been released, available from Energy Independence Publications, and listing more than 1000 outlets and available for $9.95 in a glove-box size.
India’s Finance Minister condemns ethanol policies of West as “outrageous”; Petroleum Minister announces doubling of Indian ethanol content requirment
March 27, 2008
In India, Petroleum and Natural Gas Minister Murli Deora said that the national government would raise the required ethanol content in gasoline from 5 percent to 10 percent in October.
Meanwhile, Indian Finance Minister P Chidambaram, speaking at a conference in Singapore, called the policies of developed nations converting food into fuel “outrageous and must be condemned” and that the world’s poor are feeling the impact of higher food prices. “It is a sign of the lopsided priorities of certain countries that they will resort to measures that will produce fuel at a cheaper cost in order to meet the transport requirements of a section of their population,” he said. He did not offer comments on India’s rapidly expanding capacity to do the same thing.
In further developments in Indian biofuels-fromfoodstock, Tata Chemicals said will invest $185 million between now and 2012 to develop ethanol production capacity. The company announced that it would invest the first $12.7 million of that fund in a 3 Mgy sweet sorghum ethanol demonstration plant in Maharastra. The facility, which will be constructed by Praj Industries, will open in 2010. Tata said that it is exploring jatropha cultivation at five labs in Maharashtra and Gujarat. Tata Chemicals recently said that it would join the Sweet Sorghum Ethanol Research Consortium. By joining the Consortium, TCL will have access to Consortium research, including cultivation best practices and superior hybrids.
India and other countries continue to increase their focus on sweet sorghum as a feedstock, primarily because it can be cultivated on otherwise non-arable land and is inexpensive. Earlier this month, Rusni Distilleries said it was planning to double its sweet sorghum ethanol capacity to 8 Mgy in March 2008, and Ultimate Bio Fuels has announced a 19 Mgy sweet sorghum facility in Visakhapatnam. The completion of the projects will increase India’s sweet sorgum ethanol capacity to 38 Mgy.
Meanwhile, the United Nations World Food Programme (WFP) said it will need $500 million in extra funding to solve a food crisis in 36 countries, triggered by a 75 percent rise in food prices since 2000. The organization said that new outbreaks of famine were occurring in cities, where food was widely available, but residents could not afford the increased prices. The group said that more than 25,000 Indian farmers committed suicide last year over food shortages and debts, where India was experiencing an all-time low rate of agricultural growth.
An area of fertile soil the size of the Ukraine is disappearing each year because of drought, deforestation and climate change. The group also said that rising oil prices have caused fertilizer costs, which account for 25 percent of US agricultural expense, to rise more than 150 percent in the past five years.
In India earler this year, Bihar state will re-auction 60-year leases on 10 abandoned sugar mills after bids were not received on three and seven bids did not meet the reserve price. Five mills were successfully leased to Reliance Industries, Hindustan Petroleum, Rollcon Projects and SS Infrastructure were successful in their lease bids.
Bihar has indicated that it hopes to reactivate as many as 15 sugar mills to produce ethanol, although the central government has required that only mills that produce sugar and ethanol will receive a waiver from the 1966 Sugarcane Control Order which bans the direct conversion of sugar juice into ethanol fuel. Previously, ethanol could only be made from molasses.
India is projected to have a surplus of 11.5 million tonnes, based on a projected 33.15 million tonnes harvest this year, which would be a world record for national sugar production. Recently, 10 sugar-producing states have agreed to a framework for a national E10 mandate. India’s sugar crop this year is expected to exceed 29 million metric tons. With domestic consumption at 19 million tons and exports at 1.5 million tons, the country is turning to ethanol production to avoid a catastrophic sugar glut.
US corn exports rose 6 percent in 2007; $3 billion ethanol subsidy reduced crop support payments $6 billion, reduced US trade deficit more than $20 billion
March 27, 2008
The Ethanol Promotion and Information Council responded to a recent report that US ethanol production had led to Haitian villagers being forced to eat mud pie.
In its response, EPIC noted that US corn exports in 2007-08 market year were 2.25 billion bushels, 6 percent more than in 2006-07 and the highest since 1990, and that the largest increase in sales went to Mexico, “one of the very nations that we are supposedly starving to death.”
EPIC also noted that US ethanol subsidies, totaling $3 billion, have resulted in a $6 billion reduction in crop price supports and a $15 billion drop in US oil imports. EPIC said that the true reason for rising food prices was rising labor, packaging and fuel costs, and rising wealth and demand from China and India.
The Agriculture Department will release its projection of acres planted later this month, while Chicago grain trader Dan Brophy told the Chicago Tribune, “personally, I don’t think there are enough acres to satisfy the demand in all these commodities”. The US Agriculture Department projected farm-grown exports at $101 billion in the 2008 fiscal year, a 23 percent increase over 2007 that would result in a $24.5 billion agricultural trade surplus. The trade balance has improved $10 billion since November, despite a falling dollar. However, the American Bakers Association warned that wheat reserves fell to a 27 day supply, compared to the historic average of 90 days.
In Washington, John Podesta, CEO of the Center of American Progress, said that fossil fuels account for two-thirds of the cost of producing and transporting grains, and blamed the 129 percent increase in fuel costs for the increase in food prices.
Lester Brown, director of the two-thirds of the Earth Policy Institute, recently wrote that ethanol grain usage has increased 27 million tons between 2006 and 2007. However, the chief scientist at BP said that crop prices have been rising because the emerging world is consuming more food, noting food grains demand increased by 28 million tons, and that ethanol uses only 4 percent of world grain production.
Crop failures in the Ukraine and Australia, as well as yield problems in China, have exacerbated the situation. Professor Garth Taylor, of the University of Idaho, identified Brazilian, Argentine and Australian droughts as well as increased Third World demand for the run-up in prices. He also said that the weak dollar, US drought risk, low interest rates and the unsigned Farm Bill have impacted prices.
In Mexico, as many as 100,000 farmers took to the streets in Mexico City to protest the end of corn tariffs, saying that the United States would put Mexican corn out of business. On January 1, tariffs on sugar, milk, beans and corn were eliminated under the NAFTA agreement. The US sugar industry and Mexican corn industry are considered to face the greatest risk from this round of tariff eliminations. Last year, food riots erupted in Mexico over the rising price of white corn, which is produced primarily by Mexican producers for the domestic market. Last year’s protests in Mexico sparked the “food vs. fuel” debate over ethanol.
Corn futures at the Chicago Board of Trade have increased to $5 per bushel, prompting expectations of another big spring planting of corn. Last year, farmers planted record acreages of corn and produced a record 13.074 billion bushel corn crop. Despite the record production, reserve corn stocks only increased from 1.3 billion to 1.4 billion bushels, owning to strong ethanol producer demand as well as 2.45 billion bushels in export sales.
Providing more background to the reserve stock shortages, the International Food Policy Research Institute recently released a report saying that the world is eating more food than it produces, and that biofuel production runs the risk of creating social unrest. The report projected a 66 percent increase in the price of corn and a 50 percent increase in oilseed prices by 2020, attributed to biofuel production. The report also said that global cereal stocks have fallen to their lowest levels in more than 15 years.
110 Mgy Red Rock Renewable plant approved in Iowa
March 27, 2008
In Iowa, Red Rock Renewables won approval for its 110 Mgy corn ethanol plant proposed for a site near Pleasantville. Opponents had criticized the plant’s location, traffic impact , safety plan, and potential for pollution as well as raising issues with water usage. Construction is expected to star later this year.
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