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Showing posts with the label biofuels

Trump Admin Still Has Some Biofuels Work to Do

Last Tuesday President Donald Trump made a campaign trip to Council Bluffs, Iowa. There he told a very excited crowd his administration would be backing corn farmers and ethanol.

The President leaned into the mic and gave corn farmers a little insider news they’ve been clamoring to hear since U.S. EPA pronounced gasoline blended with 15 percent ethanol would be ok to use in all cars made since 2001, “We are a little bit early. I shouldn’t say it now, but we are going with E15 year-round.”

Mr. Trump is a little early. Today E15 can be used about 9 months out of the year in much of the nation. During those other three months, the summer months, it has been prohibited. U.S. EPA will need to write some rules about how to make the year-round use happen. Those will need to be approved, and clearly the oil industry will mount court challenges.

If all goes well more corn will be used to make ethanol for E15, but it won’t make a difference in the balance sheets for corn says University of Illinois Agricultural Economist Scott Irwin, “Not for this year and I am confident not for next year.”

So the E15 announcement, while a long run win for corn ethanol, rings a little hollow. The Administration’s other big farm country biofuels problem is EPA’s use of the Small Refinery Exemptions or SRE. The good news here, says Illinois’ Irwin, is that ethanol usage has been holding strong despite EPA letting some refineries out of the mandate to produce gasoline blended with a home grown fuel like ethanol made from corn.

However, there is a problem with oil pressed from soybeans to make biodiesel says Irwin, “And the total amount of biodiesel, because of the Small Refinery Exemptions, has probably gone down at least 10 percent. So, there has been real demand destruction from the Small Refinery Exemptions, but it is in biodiesel and not ethanol.”

US EPA has through November to announce its final decisions related to the volume of biofuels it will require in the nation’s gasoline supply in 2019. It may or may not include some guidance on how it expects to use the Small Refinery Exemptions going forward. So far, it has said it will make no comment on that point.

Jonathan Coppess Breaks Down Trump Trade Issues

The first week of April has been tumultuous for American agriculture. Todd Gleason talks with Jonathan Coppess about how the Trump Administration has been handling trade with China, the NAFTA negotiations, and biofuels.

Interviews from the Farm Progress Show

How Harvey Will Impact Fuel Supply Infrastructure
Dave Chatterton, Powerline Group - Champaign, Illinois

Monday Todd Gleason spoke with Dave Chatterton at the Powerline Group about how Hurricane Harvey is impacting the nation’s fuel supply infrastructure.


Southern States Crop Tour Review
Jeremy Wilson, Crop IMS - Effingham, Illinois

The corn crop in the south is good. Very good in fact. Todd Gleason talks with Jeremy Wilson from Crop IMS.


Discussing Dicamba Damage with Robb Fraley
Robb Fraley, Monsanto Company - St. Louis, Missouri Doug Maxwell, Crops Researcher - University of Illinois

Monsanto’s Robb Fraley dropped by the University of Illinois tent at the Farm Progress Show to talk about dicamba and soybeans. Todd Gleason has more…


Recruiting Higher Ed Ag Students to Illinois Universities

Recruiters from Illinois State, Southern Illinois, Western Illinois, and the University of Illinois are planning to work together to keep more agricultural students in state. Todd Gleason discussed the reasons why with them during this year’s Farm Progress Show.


House Ag Committee Members on the Farm Bill
Mike Conaway - U.S. House of Representatives - State of Texas
Rodney Davis - U.S. House of Representatives - State of Illinois
G.T. Thompson - U.S. House of Representatives - State of Pennsylvania

Members of the U.S. House of Representatives Committee on Agriculture held a farm bill listening session at the 2017 Farm Progress Show. Todd Gleason spoke with them afterwards and asked about the compromises which might need to be made to accommodate additional crops and the food & feeding programs.


The New IBRL Building Good for Corn Growers
Vijay Singh, Director IBRL & Agricultural Engineer - University of Illinois

The University of Illinois has built a biofuels processing facility on campus to pilot test new energy concepts. Todd Gleason has more with the Director of the Integrated Bioprocessing Research Laboratory.


Trump Admin USDA Under Secretary Nominee Ted McKinney
Ted McKinney, Director Indiana State Department of Agriculture

Todd Gleason has a conversation with Director Ted McKinney of the Indiana State Department of Agriculture. McKinney has been nominated by President Donald Trump to the post of Under Secretary for Trade and Foreign Agricultural Affairs.


Trade & Farm Bill Issues with @ILCorn
Ken Hartman, Newly Elected NCGA Board Member
Roger Sy, Treasurer - Illinois Corn Marketing Board

Illinois corn growers Ken Hartman from Waterloo and Roger Cy from Newman talk with Todd Gleason at the 2017 Farm Progress show about the next farm bill and trade issues.

What’s Next for @FieldView Software
Rick Myrup, Field View - Climate Corp

Big data tools like Climate Corp’s Field View are harnessing crop development and agronomic information from farmers and their equipment. Todd Gleason has more with Rick Myrup.


@NationalCorn Spurlock Discusses NAFA & Farm Bill
Wesley Sprulock, President National Corn Growers Association

NAFTA and the Farm Bill are the hot topics for NCGA. Todd Gleason has more with the Wesley Spurlock from Texas. He is the president of the National Corn Grower’s Association.

EPA Renewable Fuels Standard Rallies Soybean Oil Prices

Source | Darrel Good, Agricultural Economist - University of Illinois

The price of soybeans rallied about 10 percent from mid-October to mid-November. It came,despite the record sized crop harvested in the United States.

Farmers have been in awe of the soybean market since mid-August. There have been a few reasons for it to rally; a short crop out of South America and a drought constrained supply of palm oil coming from Indonesia for instance. Still, this U.S. soybean crop is big, mighty big in fact. Yet, the price of soybeans has gone higher.

Darrel Good writes about it in this week’s Weekly Outlook. You may read it online at FarmDocDaily.

There are two unusual things about this price rally. Well, one really, but it is driven by the first. The rally has come because the world seems to be short of vegetable oils. Soybean oil is among those. Here’s the important part, soybean oil lead rallies generally do not last. Darrel Good thinks this one might and that it could change the dynamics of the soybean complex. The change is driven by the Renewable Fuels Standard. The RFS did the same thing for the corn market when it began to ramp up ethanol production in the United States more than a decade ago.

The soy complex is made up of three parts; the price of soybeans, the price of soybean meal, and the price of soybean oil. The last two are the products derived from the soybean when it is processed, crushed.

The EPA RFS announcement, made last week, initially resulted in a surge in soybean oil and soybean prices. Increasing soybean oil consumption for mandated advanced biofuels, in this case biodiesel production, this year and beyond may require the domestic soybean crush to be larger than previously thought concludes Darrel Good. He says this could lead to some long-term pricing questions.

Historically, the domestic crush has been driven by soybean meal demand. If it is driven instead by soybean oil demand, this could result in lower soybean meal prices. Soybean meal has a short shelf life. Its price would need to be low enough to for it to be used quickly.

The impact of higher soybean oil prices and lower soybean meal prices on the price of soybeans is difficult to anticipate. However, a “surplus” of soybean meal, says Good, might result in lower soybean meal prices relative to feed grain prices. It could cause the soybean meal to corn price ratio that has ranged from 2.55 to 3.2 in recent years to decline. The historical range is 2.0 to 2.5.

Bill Gates Billionaires Behind Clean Energy

Ethanol Production & 2016 Corn Consumption Prospects

Commodity traders are generally thinking last week’s EPA RFS rule making will cause more bushels of corn to be turned into ethanol next year. Todd Gleason reports University of Illinois Agricultural Economist Darrel Good is more doubtful.

Let’s start by building a corn for ethanol baseline to see why. The EIA, the U.S. Energy Information Administration, says U.S. production of fuel ethanol in 2014 totaled 14 billion 313 million gallons. That was about a billion gallons more than in 2013, and nearly 400 million gallons more than the record setting year of 2011. So, 14.313 billion gallons of ethanol were produced in 2014. During the first nine months of this year, writes Darrel Good on the Farm Doc Daily website, EIA shows production 3.6 percent larger than during the same 9 months last year. It appears October and November were on that same track, and while December looks to be off a bit, it should leave the yearly consumption at a whooping and record setting 14.745 billion gallons says U of I’s Good.

Quote Summary - Production at that level will require about 5.25 billion bushels of feedstock, mostly corn, for conventional ethanol production in 2015.

So the baseline is big, but let’s start back figuring for 2016 corn usage to make ethanol. U.S. EPA just released biofuels volumes for 2016. Those standards point to conventional ethanol consumption of 14.5 billion gallons for 2016. It’s about a 500 million gallon year-to-year increase says Good, however there is a second related factor. That factor is the blend wall, or how much gasoline is actually consumed in the United States .

Quote Summary - Based on EIA projections, consumption is expected to increase from 139.38 billion gallons in 2015 to 139.96 billion gallons in 2016. That expected increase of 580 million gallons follows an expected increase of 2.9 billion gallons in 2015. The conventional ethanol mandate of 14.5 billion gallons, then, reflects an expected small increase in the E–10 blend wall and a “push” to include larger quantities of higher ethanol blends (E–15 and E–85) in the domestic fuel supply. If the 2016 gasoline consumption forecast is correct, the E–10 blend wall will be 13.996 billion gallons.

Now, since some gasoline is consumed without ethanol and some with higher ethanol blends, the effective E–10 blend wall is actually thought to be 9.9 percent of consumption or 13.856 billion gallons. Here’s the back figure. Subtract from this number imported ethanol, add in a few additional E85 gallons, and total 2016 consumption of conventional ethanol says Darrel Good is not roughly 500 million gallons more than this year, but rather about the same as this year - though that 500 million gallon gap will still have to be filled.

Quote Summary - The difference between the RFS requirement of 14.5 billion gallons and the projected consumption of 13.903 billion gallons (597 million gallons) would have to be met with some combination of retirement of RINs stocks, additional quantities of E–85, or blending of additional quantities of advanced biofuels.

This outcome is very different from the initial reaction that an increase in the implied conventional ethanol requirement from the preliminary to final rule making for 2016 of 500 million gallons would result in a measurable increase in feedstock - corn - consumption.

Scott Irwin US EPA Nov 30 RFS Reaction

Monday the United States Environmental Protection Agency put forward the rules mandating how much of each type of renewable energy can be used in the nation’s liquid fuel supply. Just a few minutes after the announcement Todd Gleason spoke with University of Illinois Agricultural Economist Scott Irwin about the new numbers.

Scott Irwin believes the U.S. EPA in this rule making is moving swiftly towards the congressional mandated volumes for ethanol and other renewable fuels.

$100,000,000 of Blender Pumps for 21 States

The U.S. Secretary of Agriculture held nothing back on the University of Illinois campus this morning (Thursday Sept 10) when he talked about bio fuels and blender pumps for 21 states.

RFS2 Set to Ramp up Biodiesel Usage

U.S. EPA has stalled the release of the annual usage mandates for bio fuels in the United States. These are due out each November, but neither the 2014 or 2015 figures have been released. EPA says it will put forth new numbers next spring. In the meantime, it might be important to consider just how using the default numbers would play out for the production of ethanol and biodiesel.



The United States congress set renewable fuels mandates a few years ago. It also gave U.S. EPA the power to adjust those mandates. EPA hasn’t done so for the 2014 calendar year, or for 2015. We’ll dispose of the political baggage and simply focus on the results of using the default statutes written into the law.