Ethanol at a crossroad

It’s farmers vs. anti-ethanol individuals as the Environmental Protection Agency nears a decision on an ethanol mandate.

An anti-ethanol campaign has launched in several corn states — Minnesota isn’t one of them — calling on the EPA not to require a higher blend of ethanol with gasoline.

It debuted in Indiana today, the Indianapolis Star says.

There still aren’t many vehicles that can handle more than 10 percent ethanol and the demand for the product has flattened. But the EPA is considering mandating an increase of the amount of ethanol that’s blended into the nation’s gasoline.

A group of lawmakers last week sent a letter to EPA administrator Gina McCarthy warning of the danger of requiring more ethanol.

Bloomberg reported that the letter, however, was written by Marathon Oil Company.

“This letter has Big Oil’s fingerprints all over it,” Wesley Spurlock, president of National Corn Growers, told Bloomberg. “The letter includes false attacks on ethanol that have been disproven time and again. The blend wall is a false construct. We have known from the beginning that eventually we would need higher blends of ethanol to meet the statutory requirements. That was the point: to replace fossil fuels with renewables. The oil industry doesn’t want to hear that. That’s why they have spent hundreds of millions of dollars trying to repeal the RFS, even to the point of having their lobbyists write this letter.”

  • jon
  • chris

    Big oil or big corn. Hard to decide who to root more against.

    • Dotherightthing

      Chris if ethanol deserved a place the mandate removal lets it prove it’s place. One has to wonder if it’s environmental impact is worse than the keystone pipeline should it have a place anymore than a coal plant does.

  • Gary F

    Problem is, there is lots and lots of farm land used as collateral on lots and lots of loans. And lots and lots of farm land bought at inflated prices because the price of corn is high because of the ethanol mandate. And most of these loans are held by lots and lots of privately owned banks, not the big mega banks.

    • sdjeffr

      the price of corn is not high currently

      • Does anybody know what percentage of corn actually goes to market in the year it’s harvested? As opposed to being stored?

      • Dotherightthing

        This program leaves a very uncertain market. Meat prices stay high because livestock producers are uncertain of prices.

        • Fletch

          We are awash in feed grains, always have been.

          The reason for today’s high cattle prices was a sell off in 2012 when there was an epic drought and pastures dried up, no hay was produced, feed and oil prices were high.

          Corn remained in surplus, but without pasture and hay a rancher can not keep cattle regardless of what supplemental feeds cost. So there was a sell off by producers which fed on itself for a while because it drove down cattle prices.

          It is called the cattle cycle, it existed before ethanol even! The byproduct of ethanol production is cattle feed. We would have these high cattle prices with or without ethanol because of grass, not corn.

          Believe it or not.

    • Dotherightthing

      Yeah the government allowed this program to get out of hand. The number of drying and storage bins is crazy. Probably a lot of large loans in place. The program was so poorly crafted and everything is held together by the government mandate. Serves the consumer no good while driving up cost of goods. So much more could have been done by promoting use of more high mileage cars.

  • Gary F

    I also was out pheasant hunting out in South Dakota and talked to the farmer we hunted with. Corn is tough on the soil, it takes out nutrients, and you need to fertilize heavily. Normal practice is to grow soybeans afterwords, they replenish the soil. He says corn is so profitable(because of subsidies) that they can still make money even with dumping more and more fertilizer on corn and not growing soybeans. That’s not good in the long run.

    Growing food to be used as fuel is not good, it should be grown for human consumption.

    • PaulK

      A new (commercial anyway) way to make ethanol is to use the stover (stalks, cobs, leaves) that is left over after harvesting the kernels. The Des Moines Register has a nice article:

      • Dotherightthing

        Not new at all. Cellulosic ethanol was to be a keystone of this program. To date it has been a failure with people thinking ultimately it will be to costly to produce. Just proof how poorly this program was crafted.

    • Fletch

      Hi Gary F,

      Corn is not subsidized directly in the farm bill, that is why it was named “Freedom to Farm”. A farmer is free to plant whatever he wants and not affect any payment he may or may not receive.

      Here is what SDSU said :

      Crop planning budgets for 2014 are showing negative margins for corn. Using 2014 corn prices at $4.00 and soybeans at $10.80 crop margins for corn are negative $(35) for corn following soybeans, negative $(95) for corn on corn acres, and positive $36 for soybeans following corn.
      – See more at:

      I could not find the 2015 numbers but prices are down for both.

      Corn with all of the biomass produced actually adds organic matter to land and soybeans actually lose organic matter, especially when grown year after year. When you see a field blowing it is not corn ground, it is more likely soybean.

      I agree that industrial agriculture is bad, we would have that with or without ethanol.

      The use of cover crops and intercrops is a new revolution coming in agriculture where fertilizer can be held in place and even be naturally grown.

    • Dotherightthing

      Not only hard on soil. Water and air quality come into play.

      • Fletch

        We grew 84.6 m acres of corn in 1976 before ethanol and 88.9m acres this year. Water and quality are not going to be any different in agriculture in corn plantings because of ethanol. You are delusional if you believe that.

        NRCS has a goal of 20 million acres of cover crops by 2020. That will be a game changer.

        Ethanol uses far less water and cleans up every dirty thing gasoline puts out except maybe Nox which it is a little higher in or a little lower in depending who does the testing.

        Brazil delayed even requiring having catalytic converters on cars in the 80s, but did have to require them when gasoline was used again in the early 90s and smog came back.

    • MrE85

      You’re welcome to grow anything you want on any land you own, Gary.
      The corn used for ethanol is not, and never was, meant for direct human consumption. It’s for livestock feed, and an earlier commenter noted, today’s ethanol plants now produce dried distillers grains, a high-protein feed that sometimes is more profitable for the plant than the ethanol. So its (animal) food AND fuel, from the same corn.

  • Erocker

    Bernie Sanders voted against extension on ethanol subsides.

  • Erocker

    He states in your article: Sanders didn’t think ethanol, which, in the U.S., is based almost exclusively on corn, is perfect.
    He is saying here that he is not all in with corn ethanol.

  • Fletch

    We will grow the corn with or without ethanol, corn is grown to feed cattle.

    In 1976 before ethanol the US grew 84.6m acres of corn. This year it was 88.9m acres.

    The corn ethanol mandate freezes at its current level in the 2007 energy law(15B gallons) and the Congressional Budget Office believes corn ethanol will remain at 10% of our fuel supply in 2017 even if the RFS were repealed. Ethanol most always surpassed or met the mandates. Its trend line growth was well established before any mandate all the way back into the early 80s.

    >>>>>>CBO expects that roughly the same amount of corn ethanol would be used in 2017 if fuel suppliers had to meet requirements equal to EPA’s proposed 2014 volumes or if lawmakers repealed the RFS, because suppliers would probably find it cost-effective to use a roughly 10 percent blend of corn ethanol in gasoline in 2017 even in the absence of the RFS. Therefore, food prices would also be about the same under the 2014 volumes scenario and the repeal scenario.

    By contrast, corn ethanol use in 2017 would be about 15 percent (or 2 billion gallons) higher under the EISA volumes scenario. CBO estimates that the resulting increase in the demand for corn would raise the average price of corn by about 6 percent. However, because corn and food made with corn account for only a small fraction of total U.S. spending on food, that total spending would increase by about one-quarter of one percent.<<<<<<<

    By removing the indigestible carbohydrates from corn, you make a healthier and more productive better feed than the carbohydrates simply going out their rear ends.

    You have more meat and extra clean fuel as a byproduct.

    Of course corn does not work economically beyond the number of cattle we have, so E15 or E20 would be the best it could do.

    Corn along with other grains are at or below the prices of 2007 yet we produce over twice the ethanol we did back then.

    If ethanol production made grain prices go up, then grain prices should be at record levels since ethanol production is at record levels.

    • Dotherightthing

      Fletch you and I agree on one key point, remove the mandate and allow ethanol to earn it’s market share. All these benefit’s should allow it to shine. The amount of additional land that’s gone into corn production has effected corn prices. Nobody holds back increased level sales. E85 does not get pimped as much by the government as E10 does. E10 has reached the blend wall.

      • Fletch

        When ethanol surpasses the mandate, it tells you it has earned its share otherwise it would not.

        Corn and other grain prices are at or below 2007 levels, in huge surpluses and yet we produce well over twice the ethanol as back then. How can this be if your paradigm is true? It can not be.

        The blend wall has been busted in 22 states including the district of Columbia. It is a construct of the oil companies.

  • >>There still aren’t many vehicles that can handle more than 10 percent ethanol <<

    According to the Department of Energy, E15 can be used in virtually all vehicles from model year 2001 and newer (and, of course, FlexFuel vehicles).

    /And where is MrE85 when you need him?


    • jon

      My thoughts exactly… Where is Mr. E85?

      • Posts about ethanol are akin to what this is for Batman. And now I’m worried whether he’s OK.

        • You called?

        • MrE85

          Fear not. I was in Rochester on Tuesday to testify before the local utility board and in Princeton yesterday to help with (you guessed it) an ethanol promotion at Coborn’s.

    • MrE85

      That’s right. Roughly 80% of the gasoline vehicles on the road could use E15. I’ve used it myself in my Honda Fit.

      • I have used it in my 2000 Audi TT as well (same engine as the 2001 models).

        I guess I’ll just void my warranty…oh, wait…

  • MrE85

    Well, the EPA released the final Renewable Fuel Standard yesterday. Bottom line: it calls for more biofuel blends in 2016 and 2017 (angering the oil industry), but not as much as many ag and biofuel groups had called for, angering them. So ethanol (and biodiesel) will be around for a few more years. I’m sure well see this debate again in a year or so.