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USDA Reduces Forecast of Corn Consumption for Ethanol by 7.5%

Decwasde
Forecast corn use for ethanol. Click to enlarge.

The December edition of the US Department of Agriculture’s (USDA) World Agricultural Supply and Demand Estimates (WASDE) drops the projected use of corn for ethanol production by 300 million bushels for 2008/09 to 3,700 million bushels from its November forecast of 4,000 million bushels. The lower consumption figure still represents a 22.3% increase over estimated corn use for ethanol in 2007/08.

Estimated corn consumption for ethanol production in 2007/08 was 3,026 million bushels, according to the USDA. Consumption for 2006/2007 was 2,119 million bushels.

The December WASDE keeps projected total corn production for 2008/09 at 12,020 million bushels, and maintains its estimate of total supply (including stocks and imports) at 13,659 million bushels. The revised forecast thus projects ethanol production taking 27.1% of the total corn supply, or 30.8% of new production.

Estimated production in 2007/08 was 13,074 million bushels, with 14,398 million bushels total supply; production in 2006/07 was 10,535 million bushels, with 12,514 million bushels total supply.

Corn use is projected lower with increased feed and residual use more than offset by reductions in ethanol use and exports. Ethanol use is projected 300 million bushels lower this month as prospects for blending above federally mandated levels decline. Financial problems for ethanol producers are reducing plant capacity utilization for existing plants and delaying plant openings for those facilities still under construction. Falling gasoline prices have also resulted in high relative prices for ethanol, reducing blender incentives.

Despite reductions in expected meat production, corn feed and residual use is raised 50 million bushels as lower ethanol production reduces the availability of distillers grains. Corn exports are projected 100 million bushels lower reflecting strong competition from larger foreign grain supplies and the slow pace of sales to date. Projected ending stocks are raised 350 million bushels. The season-average farm price is projected at $3.65 to $4.35 per bushel, down on both ends of the range from last month’s $4.00 to $4.80 per bushel.

Global coarse grain consumption is projected 7.4 million tons lower mostly on lower expected US ethanol corn use. Global coarse grain stocks for 2008/09 are projected at 165.5 million tons, up 14.6 million from last month, and the highest since 2004/05.

—USDA WASDE

Although the projected number of planted and harvested acres in 2008/09 declines from 2007/08, the USDA projects an increase in average corn yield per acre from 151.1 bushels to 153.8 bushels.

Comments

sulleny

Now that the food for fuel spooks have been chased away, we can proceed on the task of meeting and exceeding the 2009 RFS requirement of 10.21%. The EPA raised 2009 RFS earlier this year from 7.71% via the Clean Air Act as amended by the Energy Independence and Security Act of 2007.

This latest USDA announcement while lowering the total corn for ethanol use is still a 22.3% increase over 2008. All in all a continuing win for the environment, national security, and the goal of energy independence. Congratulations to EPA for pressing forward with domestic renewable energy.

sulleny

Now that the food for fuel spooks have been chased away, we can proceed on the task of meeting and exceeding the 2009 RFS requirement of 10.21%. The EPA raised 2009 RFS earlier this year from 7.71% via the Clean Air Act as amended by the Energy Independence and Security Act of 2007.

This latest USDA announcement while lowering the total corn for ethanol use is still a 22.3% increase over 2008. All in all a continuing win for the environment, national security, and the goal of energy independence. Congratulations to EPA for pressing forward with domestic renewable energy.

Karkus

Call me what you want, but we're still here, and
corn ethanol is still as bad as it ever was.

I'm OK with plant based ethanol as fuel, but not from corn. So how about this: Let's limit our corn ethanol to 10% (where we are now) and anything above that needs to come from cellulosic or some other more sustainable source that doesn't use a ton of fertilizer and water.

There's NO WAY we can grow enough corn to meet our fuel needs, and going to over 20% (as planned) will destroy our cropland even more and will raise food prices. Maybe it will only raise them a tiny bit, but there's just no way to deny that it has SOME effect (even if small).

Also, it doesn't make economic sense. Why are we subsidizing corn ethanol at $0.51 per gallon? That's crazy. And even with those subsidies, corn ethanol plants are shutting down. This is ridiculous.

ai_vin

Aren't those corn ethanol subsidies in addition to the subsidies corn already gets from general farm aid/subsidies?

Then you got to add-in the subsidies from the oil industry is because the farmers use a lot of diesel for fueling their equipment, and whatever they use to heat the distiller, and add in that the fertilizer is made using natural gas [which is also gets subsidies] as a feedstock and its a real taxpayer-financed mess.

Reel$$

Yep. With all those taxpayer (read) government subsidies - you could say the big ag corn business is nationalized.

And of course the alcohol should be made from cellulose downstream. The entire ethanol business is aware of this and are acting on it ala Range Fuels, Coskata and a dozen other cellulosic projects.

Engineer-Poet

Given that the process for making ethanol from gasified cellulose doesn't differ much from a feedstock of coal, and we've been working on synfuels from coal since the 1970's, it seems safe to say that the product is not likely to be economical any time soon.  Ethanol from corn would be entirely uneconomical if it wasn't for the subsidies and mandates.

What irks me is the paths being ignored.  Syngas (CO+H2) has about the same heating value as hydrogen and could be used as a substitute in combustion engines (roughly interchangeable with compressed hydrogen), but the only programs are to turn it into liquids at a substantial loss.  It could be burned in the field in cogenerators or simple gas turbines and the power fed into the grid.  We wouldn't have to worry about the cost or difficulties of liquefaction.

These programs look more and more like deliberate diversions, aimed at preventing any real alternatives from ever displacing petroleum.

ai_vin

Actually EP that's why I favor NG fuel for cars. Once you have the systems installed to handle gaseous fuels you can extend the stockpiles of NG by turning biomass into biogas and/or blending in H2.

Reel$$

Hard to believe that greens are suggesting expansion of fossil fuels over sustainable, renewable non-fossil fuels. But at some point, like petro engineers, people seem willing to give up the sustainability component in favor of old fashioned fossils.

Looks like we've got two players here who are eligible for the coveted " Fossil of the Day Award"

BTW, Coskata's demo plant is near completion and their plans to build a 100M gallon plant for 2011 start move forward.
http://tinyurl.com/8d9ldw

ai_vin

Acually I'm not suggesting an expansion of fossil fuels.
I'm suggesting we replace carbon heavy oil fuels with carbon light NG as a stepping stone to renewables.
I just don't think we can bring renewables online fast enough.

ai_vin

Also, as I said; Once you have the systems installed to handle gaseous fuels you can extend the stockpiles of NG by turning biomass into biogas and/or blending in H2.

And you get a higher ERoEI with biogas.

HarveyD

Most if not all bio and agro fuels cannot compete with fossil fuel when crude oil price is as low as $30/barrel.

Current grain (or cellulosic) ethanol subsidies will progressively cost more and more as production ramps up.

The only way to offset this huge subsidy future cost and reduce oil imports at the same time would be with a selective but progressive carbon tax on fossil fuel.

It will never happen in Canada (a net crude oil exporter) and most OPEP nations but it should be more acceptable in Oil importing countries like USA, China, India, Japan, Indonesia and many European countries, where over 75% of the world crude oil is used.

Engineer-Poet

ai_vin, since you're touting biogas so much, maybe you can tell me the conversion efficiency from cellulose to biogas, as well as the capital cost and conversion time.  Thermal processes may yield a much lower BTU gas, but they can be upwards of 70% efficient and work very fast.

ai_vin

What makes you think your "lower BTU gas" from "thermal processes" isn't a biogas?

Biogas simply refers to a gas produced from breakdown of organic matter in the absence of oxygen.

One type of biogas IS produced by anaerobic digestion or fermentation of biodegradable materials such as biomass, manure or sewage, municipal waste, green waste and energy crops. This type of biogas comprises primarily methane and carbon dioxide.

But the other principal type of biogas is producer gas [AKA wood gas, syngas] which is created by thermal gasification of wood or other biomass. This type of biogas is comprised primarily of nitrogen, hydrogen, and carbon monoxide, with only trace amounts of methane. However the exact percentages of each gas produced depends on the feedstock being cooked.

Although the gas produced is a mixture doesn't it make sense to put it through a filter and use the different gases for different jobs?

Engineer-Poet

Biogas means gas produced by biological processes.  Pyrolysis is definitely outside this definition.

My point is that the PTB appear to be financing expensive ethanol/F-T possibilities at efficiencies well under 50% when they could be going for pyrolysis systems with demonstrated cold-gas efficiencies of 75% or better.  The question is, why?  Which is the best use of limited feedstock?

ai_vin

You're using a much narrower definition than I and many others would use but I don't want to argue this point, it would only be distraction. Let's use a different term; renewable fuel gas? RFG would be a more inclusive category, it would include biogas, producer gas from biomass and hydrogen released from water with renewable energy.

Which is the best use of limited feedstock? Well I don't like 'either/or' arguments, 'all or nothing' arguments or 'one size fits all' arguments. When it comes to renewable energy we should use a mix of energy sources and apply the right tech to the right job: Your low BTU producer gas is perfectly suitable for a stationary power application - want more power? Just use a bigger pipe. Heck, you don't even need a combustible gas; if it's hot or pressurized from the producer you can get usable power from it. But for mobile power [like in a car] you want your fuel to take up less space, so methane and/or hydrogen is it. Ideally we should be electrifying our transport but that's not always possible.

As for which process to use? We use the right process for the right feedstock. Is the feedstock "wet" or "dry?" Pyrolysis happens at higher temperatures and water takes more energy to get past the boiling point. Anaerobic digestion takes little energy when the materials are easily biodegradable. So you use thermal gasification on wood and other high cellulose material and "anaerobic digestion or fermentation on manure or sewage, municipal waste, green waste and energy crops." As I said.

Even here it's not an 'either/or' argument. Anaerobic digestion of wet biomass will produce higher concentrations of methane but leave behind a lot of material - a lot but it's still reduced in mass, therefore it will take less energy to bring it up to pyrolysis temperatures. What remains after this could be used as biochar or put through a plasma torch to get the last bit of gas out.

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