Ethanol Producer Magazine

March 8, 2019

By the Renewable Fuels Association

U.S. exports of distillers grains (DG)—a high-protein co-product of dry mill ethanol production used in feed for livestock and poultry—were the second-highest on record in 2018, totaling 11.88 million metric tons (MMT), according to a summary of 2018 ethanol co-product trade data published today by the Renewable Fuels Association (RFA).

An estimated 31 percent of U.S. DG production was exported in 2018, meaning nearly one out of every three tons produced was exported to 50 countries on six continents last year. Mexico remained the top destination for U.S. DG, representing 17 percent, followed by Vietnam (11 percent), South Korea (10 percent), Thailand (9 percent) and Turkey (7 percent). Compared to 2017, Vietnam and the United Kingdom saw the most growth in U.S. DG exports, increasing by 306 percent and 52 percent, respectively.

However, U.S. DG exports to China continued to see a significant drop since 2016, when the country imposed punitive anti-dumping and countervailing duties against U.S. product. “Exports to China fell further after plunging 84 percent in 2017 due to the imposition of duties; it ranked 17^th in 2018, accounting for only 2 percent of U.S. exports,” the summary noted.

“As this summary highlights, distillers grains and other co-products are a vitally important part of the global feed market and a growing number of countries and regions are relying on U.S. DG exports, including Mexico and Southeast Asia,” said RFA President and CEO Geoff Cooper. “However, once again China’s protectionist actions have effectively closed off U.S. DG exports, preventing the country’s livestock and poultry feeders from accessing a low-cost, high-value source of nutrition. We will continue to work with U.S. government officials and industry partners to address this barrier and ensure free and fair trade between our two countries.”

Among other facts from the RFA report:

• U.S. DG exports had a total aggregate value of $2.47 billion in 2018, a 33 percent increase from 2017;

• The U.S. imported 317,000 MT of DG in 2017, equivalent to just 3 percent of DG exports and 1 percent of domestic DG consumption. Canada was again the top supplier of U.S. DG imports, shipping 286,000 MT to the U.S., comprising 90 percent of total imports. Brazil and China were the only other two significant DG exporters to the U.S. market in 2018;

• U.S. exports of corn gluten meal—a feed co-product made by ethanol wet mills—totaled 821,000 MT in 2018. Indonesia, Chile, and Egypt were top destinations; and

• U.S. exports of corn gluten feed—a feed co-product also from ethanol wet mills—reached 1.17 MMT in 2018, down slightly from the prior year. Ireland, Israel and the United Kingdom accounted for a combined 76 percent of total U.S. corn gluten feed exports.

This report is a companion to RFA’s 2018 ethanol trade summary, published earlier this week.

View RFA’s co-product trade summary here.

Read the original article: RFA: 2018 Distillers Grains Exports Are Second-Highest on Record

The Gazette

March 10, 2019

By Tom Vilsack

As presidential candidates make their way through Iowa and beyond, courting caucus goers and primary voters, it will be vital they include stops in rural communities contributing to America’s economy. It will be key they show up, listen, and find meaningful ways to engage our rural communities.

Rural industries are improving our energy stability and defining our transportation future. Value-added agriculture — manufacturing that makes the most out every granule of grain, waste, and grass — is a bedrock of stable, rural economies.

Right here in Iowa, biofuels have paved the way for rural economic development while making gains for our environment. Revitalizing rural communities with good-paying and high-tech jobs, they’re providing an additional market for our farmers and growing cleaner options at the pump across the nation.

For progressive candidates to understand all voters, they need to experience these promising innovations. Through biofuel production, rural communities are helping us achieve key progressive environmental goals to offset and neutralize carbon emissions and climate change, relieve disparate air and health conditions, and improve job security for working families.

Biofuel production is a sound investment in a greener future. During my time as Secretary of the U.S. Department of Agriculture we measured how effectively biofuels reduce greenhouse gases. The results are astounding. Corn ethanol reduces greenhouse gas emissions (GHGs) by 43 percent compared to gasoline and has the potential to reduce emissions by as much as 76 percent through further efficiencies, land stewardship, and conservation practices that our farmers are constantly implementing.

Iowa biofuels are not only delivering cleaner, low carbon fuels today, they are driving investment in biomass and switch grass, which can lower GHG emissions more than 100 percent. Recent biofuel innovations from the fields of Iowa are unleashing the potential for ultralow carbon fuels from recycled waste. Each innovation leads to more jobs and economic growth in America’s struggling rural communities.

As Americans continue to choose ethanol, they’re helping to offset toxic, cancer-causing chemicals that come with petroleum-based fuels. Reducing and replacing these chemicals lowers asthma rates and urban smog. These incredible biofuel benefits are not even the tip of the iceberg.

Stability in this market comes from the Renewable Fuel Standard (RFS) support — that support drives investors and innovation. Candidates interested in supporting a greener solution to our transportation needs would do well to support year-round E15 — a fuel made with 15 percent biofuel — and commit to ending handouts to oil industry giants via small refinery waivers.

Iowans and rural Americans across the country know these value-added benefits open endless opportunities. The common-sense practices from the farm to the pump are employing rural Iowans, greening our environment, and saving consumers costs at the pump. Iowa’s rural communities are prime real estate for America’s clean energy future. As we continue to innovate biofuels and invest in our growing wind generation, we can show the world a greener future beyond air pollution and offshore drilling.

To truly understand the innovations taking place and the industry impact, I encourage 2020 candidates to visit rural Iowa and these innovative industries. When you meet with rural Iowans, you find people working hard to make the world a better place. What starts in the field results in cleaner air for all of us and good jobs in communities that need them.

Successful campaigns have been able to find ways to attract rural voters around kitchen table issues. In 2007 and 2008, then-Senator Barack Obama spent 89 days visiting Iowa homes and businesses, powering him through the caucus and to the White House. The best way to win is to start the conversation. Because what gets discussed around kitchen tables in Iowa ends up feeding and fueling the world.

Tom Vilsack is a former Democratic governor of Iowa and served as U.S. secretary of agriculture under President Barack Obama.

Read the original column: Candidates Must Engage Rural Communities

Biofuels International

March 1, 2019

News Article

Renewable Fuels Association

March 6, 2019

News Release

New government data released today show that U.S. ethanol exports achieved a new record in 2018, as an astonishing 1.70 billion gallons of ethanol were shipped to more than 80 countries around the world. The 2018 export total beat the previous export record set in 2017 by 25%, and the data show that nearly 11% of total U.S. ethanol production was exported last year.

Brazil was the leading destination for U.S. ethanol exports, receiving 513.2 million gallons (mg), or 30% of the total. Canada was the second-leading market with 349.6 mg, followed by India at 156.8 mg. Together, the three countries accounted for 60% percent of total ethanol exports. The European Union, South Korea, and the Philippines were other top markets in 2018. Export volumes to nine of the top 10 destinations saw increases over 2017 volumes, with Brazil, the Netherlands, South Korea, the United Arab Emirates, and Colombia showing the largest gains.

The value of U.S. ethanol exports was $2.7 billion in 2018, up 14% from 2017’s value and the highest on record. Undenatured fuel ethanol accounted for 51% of total exports, while denatured fuel ethanol was 43%. Denatured and undenatured ethanol for non-fuel industrial uses made up the remaining 6% of exports.

U.S. ethanol imports remained scarce in 2018, with just 78 mg entering the country. Nearly all of the imported product entered through California ports and was used to meet the state’s Low Carbon Fuel Standard requirements.

Reflecting on the record year, RFA President and CEO Geoff Cooper stated, “One of the greatest successes for our industry in 2018 was growth in the export market, driven in large part by the sustained international market development efforts of RFA and its partners. More than one out of every 10 gallons of ethanol produced in the United States went into the international market—providing savings at the pump and cleaner air for drivers in more than 80 countries around the globe. This accomplishment is even more impressive when you consider that U.S. ethanol faced punitive trade barriers in several key markets. RFA will continue to work with its partners to break down artificial trade barriers, expand export opportunities for U.S. producers, and educate the world’s consumers on the benefits of low-carbon renewable fuels.”

RFA will issue later today its 2018 U.S. Ethanol Exports and Imports Statistical Summary.

Read the original release: U.S. Ethanol Exports of 1.70 Billion Gallons in 2018

Reuters

March 4, 2019

By Humeyra Pamuk

The U.S. Environmental Protection Agency said on Monday it had sent a draft of its proposed rule allowing year-round sales of higher ethanol blends of gasoline to the White House Office of Budget for review.

The rule expanding sales of so-called E15 was promised by President Donald Trump late last year as a way to help corn farmers, but includes measures sought by the oil industry to curb biofuel credit market speculation.

“We hope to expeditiously propose and finalize the rule consistent with the President’s direction,” EPA spokesman Mike Abboud said in an email to Reuters. Following the interagency process, the proposed rule will be published and put out for public comment before being finalized. Congressional approval is not required.

The process needs to be completed before June 1 to allow for gasoline with a higher blend of ethanol, also known as E15, to be available for summer sales when driving demand picks up.

E15 gasoline contains 15 percent ethanol, versus the 10 percent found in most U.S. gasoline. The ban over the year-round sales of the fuel had been imposed over concerns that E15 contributes to smog in hot weather.

The proposed rule was at the forefront of a brief interagency disagreement last week when Secretary of Agriculture Sonny Perdue said the EPA was not going to be able to finalize the rule on time. He walked back from his comments in a few hours, after speaking with EPA Administrator Andrew Wheeler.

The EPA had planned to release the draft rule in early February but was delayed by a 35 day-long partial federal government shutdown.

Trump said in October he was directing the EPA to allow year-round sales of E15, a victory for the corn industry. Combining the rule with Renewable Identification Number (RIN) market reforms was a concession to the rival oil industry.

Oil and corn industries have been in the opposite ends of a tug of war and Wheeler has been caught in the middle of pressure from lawmakers representing oil and corn states. Five Republican senators in a letter criticized his biofuels policy last month, briefly raising questions about his confirmation.

Wheeler, who had been in charge of the EPA in an acting capacity since last July, was confirmed by the Senate last week.

Under the U.S. Renewable Fuels Standard, oil refiners have to blend increasing volumes of biofuels into the nation’s gasoline and diesel each year, or purchase credits - called RINs - from those who do.

Read the original article: U.S. EPA Sends Proposed Rule for Higher Ethanol-Blend Gasoline to White House

Renewables Now

March 4, 2019

By Steve Hanson, Sean Hill

In its February 2019 Short-Term Energy Outlook (STEO), EIA forecasts that several recent trends in US biofuels markets will continue through 2020. In the STEO, production of fuel ethanol and net imports of biomass-based diesel stay unchanged, while net exports of fuel ethanol decline modestly. Federal mandates and state programs continue to support biofuel consumption through 2020, however, biofuels remain a relatively small share of total US liquid transportation fuels supply.

The most common biofuels consumed both domestically and globally are fuel ethanol and biomass-based diesel. Fuel ethanol is primarily blended with motor gasoline blendstock in the US to produce 10% ethanol blended motor gasoline, or E10. Biomass-based diesel, which collectively refers to biodiesel and renewable diesel, is typically mixed with ultra-low sulfur distillate fuel at varying percentages.

EIA expects that US fuel ethanol production will remain near current levels, decreasing slightly in 2019 to 1.04 million b/d and increasing to 1.05 million b/d in 2020. Fuel ethanol production is largely dependent on domestic motor gasoline consumption, which has been relatively stable in recent years, as fuel economy improvements have largely offset increases in population and vehicle miles traveled.

US ethanol exports have accounted for an increasing share of production since 2013 and have contributed to market growth. EIA forecasts net ethanol exports, which reached nearly 110,000 b/d in 2018, will fall to an average of 90,000 b/d in 2019 and 2020, driven primarily by the expectation that record levels of ethanol exports to Brazil in early 2018 will not persist.

Biomass-based diesel production—excluding renewable diesel—was about 120,000 b/d in 2018 and grows to 160,000 b/d in 2020. Total biomass-based diesel consumption will increase from an estimated 134,000 b/d in 2018 to 174,000 b/d in 2020. Growth in domestic production will continue to be supported by antidumping and countervailing duties placed on biodiesel imports from Argentina and Indonesia that went into effect in 2017. Current import restrictions on these countries will contribute to flat biomass-based diesel net imports through 2020, with US biomass-based diesel net imports about 70% lower than the 2016 peak.

Biofuels account for a relatively small share of total transportation fuels, with consumption supported over time by the federal Renewable Fuel Standard (RFS) as well as state-level biofuel programs. US consumption of motor gasoline was 9.31 million b/d in 2018, and EIA expects that it will increase by less than 1% annually to 9.36 million b/d by 2020.

Of the motor gasoline demand in 2020, domestic ethanol consumption will contribute about 950,000 b/d, corresponding to a national-level blend rate estimate of 10.2%. Limited demand and ongoing regulatory and infrastructure hurdles for ethanol blends higher than E10 (e.g., E15, E85) and lower-priced petroleum blendstocks restrict higher domestic ethanol consumption rates.

US diesel fuel consumption, which includes biomass-based diesel, is expected to increase from 3.8 million b/d to 3.9 million b/d between 2018 and 2020 in the STEO. The share of biomass-based diesel in diesel fuel increases from 3.6% in 2018 to 4.5% in 2020. Demand for renewable diesel, which includes stand-alone production facilities as well as petroleum refiners that co-process renewable feedstocks in downstream units such as hydrotreaters, is expected to grow in 2020.

Read the original article: EIA Expects Stable US Biofuels Production, Consumption, and Trade Through 2020

Ethanol Producer Magazine

February 26, 2019

By Erin Voegele

The USDA has released its Grain Crushings and Co-Products Production report with data from December, reporting that corned consumed for fuel alcohol was up slightly from the previous month, but down year-over-year.

Total corn consumed for alcohol and other uses as 511 million bushels in December, up 2 percent from November, but down 5 percent from December 2017. December usage included 92 percent for alcohol and 8 percent for other purposes.

Corn consumed for beverage alcohol was at 2.55 million bushels in December, down 13 percent from November, but up 13 percent from the same month of the previous year.

Corn for fuel alcohol was at 461 million bushels, up 1 percent from November, but down 6 percent when compared to December 2017. Corn consumed for dry milling and wet milling fuel production as 90.5 percent and 9.5 percent, respectively.

Sorghum consumed for fuel alcohol production was at 3.045 million hundredweight (cwt) (170,520 tons), down from 5.314 million cwt in November, but up from 2.295 million cwt in December 2017.

At dry mills, condensed distillers solubles production reached 133,380 tons, up from 128,805 tons in November and 124,098 tons the previous December. Corn oil production fell to 153,439 tons, down from 154,778 tons in November and 174,078 tons in December 2017. Distillers dried grains production fell to 238,422 tons, down from 376,137 tons in November and 442,427 tons in December of the previous year. Distillers dried grains with solubles production fell to 1.927 million tons, down from 1.93 million tons in November and 1.967 tons in December 2017. Distillers wet grains production was at 1.397 million tons, up from 1.345 million tons in November, but down from 1.431 million tons in December of the previous year. Modified distillers wet grain production fell to 466,681 tons, down from 471,972 tons in November and 511,763 tons in December 2017.

At wet mills, corn germ meal production was at 60,677 tons, up from 54,967 tons in November, but down from 71,732 tons in December 2017. Corn gluten feed production was at 390,178 tons, up from 285,362 tons in November, but down from 318,694 tons in December of the previous year. Corn gluten meal production was at 88,638 tons, up from 85,510 tons in November, but down from 91,092 tons in December 2017. Wet corn gluten feed production fell to 256,146 tons, down from 257,003 tons in November and 309,765 tons in December of the previous year.

At dry and wet mills, carbon dioxide captured reached 227,931 tons, up from 222,757 tons in November and 209,638 tons in December 2017.

Read the original article: USDA: December Corn Use for Ethanol Up from November

CNBC

February 26, 2019

By Tom DiChristopher

U.S. trade negotiators hope to convince Beijing to lower tariffs on ethanol, putting American farmers in a position to capitalize on rising demand for the corn-based biofuel in China.

The Trump administration's trade team has made the request, but their Chinese counterparts have yet to respond, Agriculture Secretary Sonny Perdue told reporters on Tuesday.

"They are engaged in conversation, they listen and hear us, but we are at this stage unable to determine the willingness factor," Purdue said, according to a Reuters report.

China once represented a bright opportunity for American corn farmers and ethanol producers, but their prospects have faded in recent years.

In 2016, China was the third biggest market for U.S. ethanol, accounting for nearly 20 percent of U.S. exports and drumming up over $300 million in revenues, according the Renewable Fuels Association. But after two years of rising trade tensions, China took just 4 percent of U.S. ethanol exports in 2018, RFA says.

Trade first dropped off after China put a 30-percent charge on U.S. ethanol in 2017. Last year, China increased the tariff to 45 percent after the Trump administration put new duties on foreign aluminum and steel.

Under a new deal, Beijing would ideally set the import tax on ethanol below 15 percent, Perdue said on Tuesday.

That would potentially allow U.S. ethanol suppliers to take advantage of Beijing's plans to introduce E10 — a gasoline blend containing 10 percent ethanol — across the country next year.

To achieve that goal, China needs to source 15 million tons of ethanol per year, a nearly sevenfold increase from the country's current consumption, according to IHS Markit. Today, China only has enough capacity to produce about 3 million tons per year.

Clearing a path for more U.S. biofuel exports would be a boon to President Donald Trump, who has had a tense relationship with the ethanol industry and agricultural states. The Trump administration has upset Big Corn by handing out hardship waivers to small refineries, which allow them to circumvent U.S. requirements to blend ethanol into gasoline.

The Trump administration has also considered changes to U.S. biofuel policy that ethanol producers worry would shrink domestic demand for their product.

Read the original article: US Aims to Lower Beijing's Tariff on Ethanol Ahead of Chinese Demand Boom

Ethanol comprised 12.49 percent of all transportation fuel consumed in Minnesota in 2017, according to new data from the Energy Information Administration (EIA).

Ethanol Producer Magazine

February 20, 2019

By Governors’ Biofuels Coalition

The Governors’ Biofuels Coalition announced Feb. 18 that Minnesota Gov. Tim Walz will serve as chair and South Dakota Gov. Kristi Noem will serve as vice chair of the coalition during 2019.

For over 20 years, the Governors’ Biofuels Coalition has provided regional and national leadership on biofuels policy. The bipartisan group is comprised of governors from across the nation.

“I look forward to working with Governor Noem to advance the bipartisan work of the Governors’ Biofuels Coalition. The production and use of biofuels increase family incomes in rural America, diversifies our nation’s energy portfolio, and provides consumers a choice at the fuel pump,” Walz said.

“We must adopt state and national policies that grow a biofuels industry vital to our states’ economies and the nation’s need to reduce carbon and other harmful emissions. Those policies include steps to open the market for ethanol as a source of clean octane to reduce the toxic aromatic content of gasoline and ground level precursors. We will continue to urge EPA Administrator Wheeler to honor President’s Trump commitment to make E15 fuel available this summer as well as many overdue EPA regulatory reforms.”

“Governor Noem and I will ask our governor colleagues to consider requiring the use of higher ethanol blends in all state fleet vehicles. Over a decade ago, many of the nation’s governors required the use of E10 in state fleet vehicles, which was a critical first step to consumer acceptance of higher ethanol blends,” Walz said.

“I’m honored to serve as vice chair of the Coalition and to continue working to strengthen the energy independence of our states and nation,” Noem said. “Minnesota, South Dakota and all members of the Coalition continue to play a major role in the nation’s energy policies.”

“Renewable energy benefits everyone, from energy consumers to farmers to anyone who breathes our air,” Noem concluded.

Walz and Noem both thanked Iowa Gov. Kim Reynolds for not only her leadership of the Coalition last year but for her tireless national leadership on renewable energy policy.

Read the original article: Walz, Noem to Lead Governors’ Biofuels Coalition in 2019