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Ethanol Trade Group Says Growing Grain Ethanol Production Is a Minor Factor in Land Use Changes

17 November 2008

The amount of agricultural land required to produce 15 billion gallons of grain (e.g., corn) ethanol in the United States by 2015, as required by the 2007 Energy Independence and Security Act (EISA), is likely to be less than 1% of total world cropland, according to projections from Informa Economics cited in a new report released by the Renewable Fuels Association, the national trade association for the US ethanol industry.

According to the report, “Understanding Land Use Change and US Ethanol Expansion,” gains in agricultural productivity, coupled with the contribution of feed produced as an ethanol co-product, are expected to mitigate the need for conversion of non-agricultural lands to support expanded US biofuels production.

In addition to examining projections from Informa Economics on future global agriculture land use, the RFA report cites studies and findings by the UN Food & Agriculture Organization, Oak Ridge National Laboratory, the US Department of Agriculture and other researchers and research organizations. The report analyzes historical cropland and crop utilization trends, explores the complex and multifaceted nature of land use changes, and discusses the uncertainty of current land use change modeling approaches.

The debate over the causes and effects of land use change has significant implications for the future of the US biofuels industry. As required by EISA, the US Environmental Protection Agency (EPA) is establishing a methodology for determining the lifecycle greenhouse gas (GHG) emissions from the production of various biofuels, including GHGs from indirect land use changes. According to the RFA report, the models currently used by EPA and others to assess potential indirect land use changes ”... have numerous limitations and cannot possibly predict with any certainty the extraordinarily complex causal interactions that drive land use change decisions.

The report asserts that several factors must be considered to determine accurately the causes of direct and indirect land use changes, including:

  • Minimal use of farmland for biofuels production. In 2007/08, 0.9% of world major cropland was needed (on a gross basis) to meet the grain requirements of the US ethanol industry. When the ethanol industry’s production of feed co-products are factored in, the net use of global cropland for US ethanol production was 0.6%, according to the RFA—an area roughly the size of the state of West Virginia.

  • Global agriculture’s increasing productivity is meeting rising demand. Production agriculture, particularly in the United States, has dramatically increased its productivity through the use of technology. Using average global corn yields from 40 years ago (1967), more than 330 million hectares would be required to produce the world corn crop grown on 158 million hectares in 2007. In other words, it would have taken more than twice as much land in 1967 to grow a crop equivalent in size to the 2007 world corn crop.

  • Arable farmland is available for sustainably increased production. Though it seems unlikely that significant amounts of land will be needed to support future growth of the US biofuels industry, large amounts of arable land are available, if needed, for agricultural expansion. According to the UN FAO, 2.8 billion hectares beyond the current 1.5 billion hectares of land used for arable and permanent crops are to some degree suitable for rainfed production.

  • Ethanol feed co-products contribute substantially to the global feed market and provide a considerable land use “credit.” One hectare of corn used for ethanol produces more than 1000 gallons of fuel as well as an amount of feed equivalent to the volume of corn coming from 30% of a corn-dedicated hectare and the amount of soybean meal from 50% of a soybean-dedicated hectare.

  • Many factors drive land use changes around the world.

Global agricultural land use. Out of the total global land area of approximately 13.1 billion hectares, 1.4 billion hectares are considered arable. The global area required for major crops has averaged about 850 million hectares, or 6.5% of the world’s land surface, in recent years. Rice, oilseeds, wheat, and coarse grains typically account for approximately 90-95% of global cropland. Total agricultural land use increased less than 1% between 1995 and 2005.

The amount of global land dedicated to coarse grains (corn, grain sorghum, barley, oats, rye, and millet) has decreased 8% since 1980, while world grain ethanol production has increased dramatically. Global coarse grains area peaked at 349 million hectares in 1981 and is estimated at 313 million hectares in 2008. Despite the reduction in land dedicated to coarse grains, annual world coarse grain production has increased nearly 50% since 1980.

US land use. The total land area in the United States is approximately 915 million hectares. The various uses of land in the United States have been relatively constant over the last 60 years, though agricultural land has decreased slightly, while urban and special land uses have increased. In 2002 (the most recent year for which data is available), total cropland totaled 179 million hectares. This figure includes land used for crops, idle cropland, and cropland pasture.

The 2002 total is the lowest since USDA began recording these statistics in 1945 and is the first time cropland use registered under 182 million hectares since 1964. The area used for crops alone was 138 million hectares in 2002. Cropland used for crops in 2006 declined further to 134 million hectares, according to the report. The share of idled cropland has increased since USDA began recording land use data in 1949.

Land used for urban areas in the US increased 340% from 1945 to 1997. Further, rural residential land was estimated at 38 million hectares in 2002, up 13% from 1997, which was the first year USDA measured rural residential land use. The US Department of Agriculture (USDA) reports that urban land area has increased at about twice the rate of population growth.

On average, nearly 1 million hectares of farmland per year were converted to urban uses between 1992 and 2001. Urban, rural residential, and special use lands accounted for about 20% of total US land use in 2002, slightly more than cropland use.

Ethanol and corn. The amount of corn processed into ethanol in the United States has grown eight-fold from approximately 9.3 million metric tons in 1990/91 to 76 million metric tons in 2007/08.17 Corn fed to livestock and poultry has also increased during this period. Corn exports have fluctuated during this period, but generally trended up slightly. Annual corn production grew from 200.7 million metric tons in 1990/91 to 333 million metric tons in 2007/08.

Although the number of bushels of corn produced has increased, the fertilizer per bushel has decreased.

One of the main arguments waged by those who believe increased biofuels production will lead to significant indirect land use change is the idea that US exports will drop appreciably, inciting cultivation in other countries to account for the lost volume on the world market. Such an export reduction has not occurred. In fact, corn exports reached record levels in 2007/08 and, despite the current global economic slowdown, are projected to be above the 10-year average in 2008/09. Soybean exports also set a new record in 2007/08 and are expected to remain strong in 2008/09. Exports of ethanol feed co-products like distillers grains have increased dramatically in the last three years and are offsetting some demand for corn and soybean exports.

On a global scale, US ethanol production is expected to consume approximately 6 percent of the 2008/09 world coarse grains supply (corn, grain sorghum, barley, oats, rye, and millet) on a net basis. When all grains are considered (coarse grains, rice and wheat), the US ethanol industry is projected to consume 2.9 percent of the world’s grain supply in 2008/09.

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November 17, 2008 in Ethanol | Permalink | Comments (12) | TrackBack (0)

Comments

These comments show how to solve the nuclear waste problem just dilute them. (It is actually a good solution long lived radioactive elements exist in all soils maturallt.) By comparing to total world crop area and total US grain production it does not seem that corn should have much effect, but it is still a fact that all of the agricultural lands in the US could not make enough fuel for all automobiles in the US. It is also a fact that speculation in the corn market partially incited by ethanol production drove up corn prices substantially all over the world.

In a website about a wood fired power plant and a wood diesel test facility, it is admitted that all the forests in Austria could not produce a large fraction of the diesel needs of the automobiles of that country. It also admitted that electric cars are a more efficient use of the wood fuel energy. The same is more than true of the US. ..HG..

Posted by: Henry Gibson | November 17, 2008 at 04:29 AM

HG:

Wouldn't new and future high performance (30%) solar panels convert sun energy for e-vehicles (and HVAC) more efficienctly than corn-ethanol-ICE vehicles?

Why go through multiple land use polluting process when we can use a much more direct clean (unlimited) energy route.

Agro liquid fuel is not the easy (nor clean) way to produce essential energy for transportation (and HVAC) but to convert useless and harmful wastes (and surplus grains) into gas or liquid fuel may be more acceptable.

The world may need all the available land to feed and log the soon to be 10+ billion people and still have enough forest areas to absorb the surplus CO2.

Posted by: HarveyD | November 17, 2008 at 08:30 AM

HG:

Wouldn't new and future high performance (30%) solar panels convert sun energy for e-vehicles (and HVAC) more efficienctly than corn-ethanol-ICE vehicles?

Why go through multiple land use polluting process when we can use a much more direct clean (unlimited) energy route.

Agro liquid fuel is not the easy (nor clean) way to produce essential energy for transportation (and HVAC) but to convert useless and harmful wastes (and surplus grains) into gas or liquid fuel may be more acceptable.

The world may need all the available land to feed and log the soon to be 10+ billion people and still have enough forest areas to absorb the surplus CO2.

Posted by: HarveyD | November 17, 2008 at 08:31 AM

HarveyD,

You are completely right. And even forgetting the biggest advantage of the PV-EV solution: we can use none agricultural land for it, like deserts or rooftops. No competition with food production whatsoever.

Posted by: Anne | November 17, 2008 at 09:40 AM

Am I concluding correctly that the article says that sacrificing 1% of agricultural land for 15 billion gallons of biofuelse is no big deal? 15 billion gallons is ~8% of total US passenger vehicle fuel consumption. So would 100% biofuels cost 12% of the total world agricultural land? And how much land would powering all cars and trucks on this planet by biofuels cost? 50%? Am I missing something?

Posted by: Anne | November 17, 2008 at 09:51 AM

This year, the cost of a bushel of corn doubled, rising along with numerous other commodities being bought and sold by speculators, including wheat, sugar and soybeans. Rice, which has no impact on ethanol production TRIPLED in price. Some speculators withheld sizable blocks of commodities in order to create artificial shortages, and then sold at a much higher price. The commodities market was manipulating supply and driving prices.

The escalating cost of transportation fuels to ship corn and foods in general was a much bigger factor in food prices than the 5 cents per pound that was added to the cost of the corn itself. Ship a ton of corn from Iowa to China and see what happens to the price. The claim that corn ethanol is the main cause for the high price of corn and corn based foods can NOT be substantiated. Now the price of corn is back down to where it was a year ago, but did food prices drop? No, because the raw materials in processed foods represent only a small fraction of the huge overhead cost of foods sold in supermarkets.

There is no shortage of corn. This year, exports of whole corn increased by 20% after being flat for years. Corn farmers would export more if the demand was there. Almost all the corn we export is Not for human consumption. It is feed corn. Shipped to foreign countries gaining affluence, like China and India, to produce meat, dairy, and animal products. This year, the value of dry distillers grains, a byproduct of corn ethanol, increased dramatically, as foreign demand increased and exports doubled. High protein distillers grains, produced by ethanol refineries, is also a feed product that goes toward the production of food. Ten to fifteen percent distillers grains added to the feed of dairy cows increases their milk production by 10 lbs per cow per week. It also puts 10% to 12% more meat on livestock, and it makes fish farming more productive.

We grow all the corn suitable for human consumption that the world can stand, and we could produce much more. There’s plenty of corn and distillers grains available for sale, if you can afford the shipping cost. The cost of the grain itself is minimal.

The ethanol industry removes the starch from 25% of the feed corn crop to make fuel. That’s no great loss in the realm of feeding livestock, because cows don’t digest the starch very well anyway. So the industry is taking low value corn starch and converting it into a high value fuel product. And what we have leftover is the more digestible portion of the corn kernel, as animal feed, in the form of high protein distillers grains. Corn oil is another byproduct of ethanol refineries, transformed into value-added products.

Some corn ethanol critics make the false assumption that people are starving, because starch is being extracted to make ethanol from 1 out of 4 bushels of Feed Corn. When in reality, the corn ethanol industry makes a superior feed product that produces more meat, dairy, poultry, fish, and pork, in addition to corn oil and a renewable domestic fuel.

Posted by: Jeff Baker | November 17, 2008 at 10:45 AM

Ann - you are missing the notion of decreasing demand for biofuels as electrification increases. A typical commuter driving a E-REV with 40 mile AER, will never use the liquid fuel in the tank. On weekends, or on longer non-commute trips - the ICE kicks in and burns low volumes of renewable liquid fuel to recharge batteries. In the parallel PHEV the overall MPG averages 60-120 depending on the measuring formula.

Yes, solar is terrific especially in sunbelts like the US has. Do we paper the landscape with 15-20% efficient PV now? No. We implement solar thermal to generate an increasing amount of renewable grid power - California requires investor held power companies to include a 20% renewable portfolio by 2010. It would be better to demand that municipal/government utilities do the same and grow the PV/solar utility industry by expansion. That will drive residential PV pricing lower - faster.

Claiming 50% of Earth's agricultural land will be required to biofuel the world's transport - is unnecessary, histrionic fear mongering that is being put to sleep daily by change.

Posted by: sulleny | November 17, 2008 at 11:01 AM

What the report basically says is that if the past is any indicator of the future we will be able to sustain both food and fuel use with the same amount of land or land that is currently fallow. They look at the past and see that land dedicated to growing grain has actually decreased, despite the increase in demand from a higher human population and the spike in ethanol production. They also state that the use of a small percentage of abandoned agricultural land (fallow farmland) would more than cover a much higher demand. It also says that forested areas in many areas are increasing while deforestation in South American and Southeast Asia is decreasing. They state that corn (and soybean) exports were at or near record levels and that there are now major exports of ethanol co-product, distillers grain, that also offset some demand of other grains used as feed overseas. One thing stressed in this report was that 1 hectare of corn used to create ethanol yields about 4000 liters of ethanol and the distillers grain displaces the equivalent of 1/3 of a hectare of corn and almost 1/2 of a hectare of soy. So you’re basically recovering 78% of the harvest even after pulling out the ethanol. That’s a lot more than I realized.

Another interesting item was that fertilizer (nitrogen was the example) use has been cut by about a 1/3 since 1980 and that fertilizer runoff into the Mississippi has decreased by 20% since 1980.

DYK: There is currently some 30.6 million acres (general contracts-not counting 4.1 million high pri conservation lands) that we (as taxpayers) pay to keep fallow? That’s a cool $1.8 billion. I’m sure some percentage of that could be brought back into production…

Ethanol is not the answer, it is a transition. I say brew baby brew. I say we mandate that all new ICE cars be able to use the common mixes of ethanol (and meth/butanol - even cng). Break the oil monopoly, let demand do the rest. And yeah, phase out the subsidies over time, remove ethanol import tariffs. Get the blender's tax credits down to the reail level so they'll install the pumps. Put a floor on the cost of a barrel of oil so that investors have a steady mark to shoot for.

Bring on the Volt, get those plug-in Priuses out there, keep improving battery technology. Get the price of PV down to the point where it pays Joe the Plumber to put them on his roof. Yep, I'm on board. We need it all.

While we're doing that, give Joe the ability to choose his fuel. Every year we wait we put another 100 billion or so into the pockets of...well you know the rest...

Posted by: Paul | November 17, 2008 at 01:46 PM

I am skeptical of the rosy picture they paint.

quote:

"the US ethanol industry is projected to consume 2.9 percent of the world’s grain supply in 2008/09."

Considering the ethanol industry is still pretty small, I'd say that's a significant figure. If the ethanol usage were to increase from current levels, and if the rest of the world were to follow suit, what number would you get? Something closer to 20 or 30%?

However, they do say that they use the less valuable starchy parts, and the rest goes to animal feed.

I don't remember seeing any mention, although Paul mentioned it, of how the increased wealth of the developing world, and increased demand for meat products, which will require significantly more land area to support (via increased US grain production), will factor into the equation. There are a LOT of people over there. I wonder if the US actually could supply that much grain. Maybe I should have read more thoroughly.

Regarding life cycle GHG emissions, "the models currently used by EPA and others to assess potential indirect land use changes ”... have numerous limitations and cannot possibly predict with any certainty the extraordinarily complex causal interactions that drive land use change decisions.”
Of course....

Following their links I came to this huge list of FAO figures:

http://www.fao.org/statistics/sumfas/sumfas_en_web.pdf

I really wonder about the deforestation and arable land figures they come up with, especially for Latin America. The numbers about deforestation can be quite misleading, depending on how you define "forested" land. Out of curiosity, I wonder how they would they classify oil palm plantations in Indonesia?

But I agree, sensible biofuel programs do have a role to play in the short term for transportation applications that do not easily work with electrification, such as long haul trucking and aviation.

Posted by: Mark_BC | November 17, 2008 at 09:17 PM

The price of any kind of solar cells or even thermal solar energy is quite high for the 200 watt-hours per mile needed, but it is a far more efficient use of the land. It turns out that every square yard of solar cells can produce about that much in a day. This figure may be off. It may not be a bad idea for individual farmers to use some bio-energy, but it is totally misguided to expect an industrialized society to be able to do it now when two hundred years ago, it led to the destruction of much of the forests in England and Europe. There are people who had a much lower caloric intake of corn itself because of the high prices that would not have been there except for the demand for ethanol. ..HG..

Posted by: Henry Gibson | November 17, 2008 at 10:45 PM

Of course, they paint a rosy picture; it's the Ethanol Trade Group.

However, their general conclusions appear correct. Future developments are uncertain though. The succes of EVs and SPHEVs and many other developments could result in downward pressures, whereas if 2 billion Asians want to eat 200 grams of meat per person every day, that's going to increase pressures. Incomes around the world are steadily increasing overall, and that means a bigger % of meat in the diet. And how many people will there be? 10 billion, 12 billion.

When people have to pick between food and fuel, they're likely to pick food. Unfortunately, high food prices could be a humanitarian disaster for the world's poor. Paradoxically, making the poor rich would result in upward pressures on agricultural prices through increased affluence (demand for food, particularly higher grade food).

Posted by: Cyril R. | November 18, 2008 at 01:47 AM

Mark BC:

A skeptic on GCC is really a denier.

Posted by: | November 18, 2008 at 10:53 PM

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