Elephants in the closet part 2, Ethanol

We hear a lot of negative press about ethanol, to be honest I have some questions myself. However, even though some of my fellow livestock producers in other states grumble about the effect ethanol has had on their production costs. Its not been a bad deal for me or our state. Today's blog will probably leave you with more questions than answers, so it's a good thing our Ag session is next week. When a bushel of corn is fermented into ethanol you get about 1/3 alcohol, 1/3 distillers grains, and 1/3 CO2. If you are close to a plant you can use the wetter, less expensive distillers by products because of the cheaper freight relative to dry matter of feed. This is a good deal for me because I have an ethanol plant and a commodity broker less than 6 miles from one of my farms. Its also a good deal for the plant because drying the distillers grain requires a good amount of energy from coal or natural gas.

Today on the farm I hauled wet distillers solubles (syrup) to the cows. This is the most economical by product available from the ethanol plant for the digestible protein needs of my cows. The product is cheap because it is only about 40% dry matter. I am only 6 miles from the plant so this is a good option for me, for my friends that are more than 100 miles away using your freight budget to move a wet commodity can be a losing proposition.

Here is the plant, this is one of several in our state. Ethanol has increased demand for corn by nearly 40 %.  The million dollar question is, does it take more energy to make ethanol than is contained in ethanol? I am a corn buyer and this demand has caused the price to more than double since harvest. Corn is currently at about $6.20 per bushel down from a $7.00 high at the beginning of this month. An interesting side note this is only the 3rd time in my 17 years of raising cattle that I have had to buy corn at above the cost of production. The farm program made cheap corn and many industries were built around this. This is also going to have some impact on food price. Although I believe demand from the growing Asian economies will have a far greater impact on our food prices. I think the cheap food we have grown accustomed to in this county is coming to an end. I also think ethanol is going to take an unfair amount of the blame.

Loading syrup for the cows. When the grass is dormant in the winter cows need supplemental protein to break down the fiber in the dormant grass. The by products from ethanol production are the best protein supplements I've ever used. Next question, when figuring net energy gain on ethanol production do they account for the feed I get to put back into the cattle? The conversion on the by products is superior to corn.

Commodity shed storing the different by products, wet gluten, dry gluten, wet distillers grain, etc.... regular by product buffet.
The ethanol plant in Shenandoah has started to capture the CO2 to produce algae for bio fuels. As much as I don't like the high corn I believe that as we start to utilize the by products from ethanol we will continue to see a greater net energy gain from ethanol production.

Cows enjoying their tasty syrup, we feed the by products to the calves as well. The dogs even like it.

This is what I don't like about $7.00 corn. There is a considerable amount of marginal land that was good pasture being converted to crop production. The few producers who choose to do this are taking a short term gain with severe long term consequences. But it's our demand for energy that's causing it. The American consumer wants cheap food and cheap energy. I am confident that we can feed a growing world. I also believe we will develop new forms of energy. But, I do believe it will take a greater percentage of our income to have these things.

Keep in mind that raising crops for energy is really nothing new. Until WWII between 20% and 30% of our acres were dedicated to raising oats to feed the horses that provided transportation and power to pull farm equipment. We have been able to use fossil fuels to increase yield yet there supplies are dwindling. Unless someone can present a better solution. In spite of the unknowns I believe the ethanol industry is moving in the right direction and that it I deserves our countries support.