Green Plains Bets on Ethanol Recovery
by Debra Fiakas CFA Last week the Chief Executive Officer of Green Plains Renewable Energy, Inc. (GPRE: Nasdaq), Todd Becker, revealed during conference calls following its quarter earnings report that the company has been in discussions to sell ethanol to industrial users in Mexico. It is news that could be music to shareholders ears. U.S. storage tanks are brim full of ethanol as producers like Green Plains stock pile inventories waiting for better selling prices. Green Plains has made claims to Mexico sales before, but has never revealed customer names or volumes. None were named...
Xethanol to Acquire Plant in Georgia
Xethanol Corporation (XTHN.OB) announced that its CoastalXethanol subsidiary has signed a letter of intent with Pfizer, Inc. to purchase Pfizer's pharmaceutical manufacturing complex located in Augusta, Georgia. While details are yet to be finalized, CoastalXethanol and Pfizer are working together to complete the transaction. The state of the art, 40 acre site includes: an 89,100 square foot manufacturing facility, a 25,000 square foot warehouse facility, 7,300 square feet of laboratory space, and 16,000 square feet of offices and conference rooms. CoastalXethanol intends to retrofit the site to produce 35 million gallons per year of ethanol. The facility will...
Ethanol shortage could up gas prices
USA Today Money comments about a potential for future increases in gas prices and also shortages in Ethanol. "Gasoline prices will be unusually high and shortages might occur this summer, because the U.S. ethanol industry can't keep up with the demand for fuel-grade alcohol to mix with gasoline, the head of the U.S. Energy Information Administration told a Senate committee Wednesday." On Wednesday of this week the Senate Environment and Public Works Committee met to discuss ethanol as a substitute for MTBE, a clean-air additive in gasoline. This potential change will increase the cost of refining...
Pacific Ethanol Completes Permitting for Planned Ethanol Plant in Boardman, Oregon
Pacific Ethanol, Inc. (PEIX) announced that it has received all necessary permits to begin construction on a 35 million gallon per year ethanol facility at the Port of Morrow, located on the Columbia River near Boardman, Oregon. The Company further stated that it expects to begin construction, which should take approximately 12 months, within the next thirty days. The Oregon ethanol facility will provide ethanol for the Pacific Northwest gasoline markets, helping to increase supply in that area and provide a CO2-reducing fuel for the transportation sector. It is expected that the plant's distillers grains will be sold...
A Simple Fix To Farmer’s Tariff Woes?
by Jim Lane
As most know by now, the US and China have fired opening salvos in a trade war, with the US targeting a range of commodities including steel and aluminum, and China retaliating with, to date, stiff tariffs on a range of agricultural products, but primarily hitting soybeans and corn because of the volume of trade in those agricultural goods. Overall, China imports $24 billion of agricultural goods from the US and is a leading export market for the US.
The trade wars prompted North Dakota farmer Kevin Skunes, president of the National Corn Growers Association, to state:
“Farmers are...
Tax On E85 Renewable Fuel Soars
Jim Lane The US passed a dubious and historic milestone this week. The tax rate on E85 renewable fuels now exceeds 100% in some formulations. By comparison, the tax rate on E10 renewable fuel is running at an estimated 41% and the tax rate on straight gasoline is running at an estimated 35%. As Shakespeare observed in Measure by Measure, “some rise by sin, and some by virtue fall”. Now, the idea of a carbon tax is that governments are supposed to collect more tax against high-carbon fuels. Yet, policy in practice works the other way. The less carbon...
US Ethanol Industry Upset With 2019 Renewable Fuel Standard Proposal
The 2019 proposed US Renewable Fuel Standard proposed volumes attracted a major raspberry from the ethanol industry.
As the American Coalition for Ethanol noted:
“Unfortunately, EPA continues to take actions which undermine the letter and spirit of the statute and harm the rural economy. While refiners are reporting double-digit profits, the heart of America is being left behind. Farmers are losing money while refiners have the best of both worlds: fat profit margins and minimal RFS compliance costs. EPA needs to discard its refiner-win-at-all-costs mentality and get the RFS back on track.”
“While the proposed rule purports to maintain the 15-billion-gallon conventional...
Beyond ZEVs: The Negative Emission Vehicle
by Jim Lane
Wandering the halls at the BIO World Congress and later to be seen again at ABLC NEXT this November, we ran across one of the most interesting technologies relating to ethanol production and markets we have seen in a month of Sundays, perhaps two months’ worth.
The problem
First, let’s revisit the problem. There’s simply too much ethanol being produced for the markets to absorb, given the Trump Administration’s massive cutbacks in US ethanol targets —In the resulting massively oversupplied market, the inevitable has happened, ethanol producers, growers and the Midwestern economies are being crushed. And they thought they...
Why Have Ceres’ Sorghum Plans Soured?
Jim Lane Sorghum Bicolor photo by Matt Lavin As Ceres points towards minimal plantings of its sweet sorghum hybrids in its key market of Brazil for next year, investors ask two questions. Will sweet sorghum realize its vast potential, and when? Just when many observers hoped that Ceres, Inc. (CERE) would dramatically expand hectares planted with its Blade hybrid sweet sorghum, the 2014 planting outlook was released last week and the total hectares crashed from 3000 in 2013 to 1000 in 2014. It’s a far cry...
Corn Ethanol Emissions Savings Skyrocket
Jim Lane In Washington, an explosive new peer-reviewed report from ICF found that greenhouse gas emission reductions from typical corn-based ethanol production have soared to 43 percent compared to 2005-era gasoline. The report projects that by 2022, corn-based ethanol will achieve a 50 percent reduction, and could reach “76 percent in 2022 if there is more widespread adoption of optimal crop production and biorefinery efficiency.” The report, issued by the U.S. Department of Agriculture, based its revolutionary emissions math on a November 2014 study by researchers at Iowa State University, which found that farmers around the world have...
ADM and Siouxland Ethanol Announce Marketing Agreement
Archer-Daniels-Midland Co. (ADM) and Siouxland Ethanol LLC are pleased to announce the formation of an ethanol marketing agreement. As part of this marketing agreement, ADM will market all ethanol produced by Siouxland Ethanol at its forthcoming 50 million gallon Jackson, Nebraska facility. Construction has begun and the plant is expected to be operational in early 2007. In addition to producing ethanol, the plant will produce an estimated 165,000 tons of distiller grains on an annual basis.
EPA Slashes Corn Ethanol Targets Under Proposed Renewable Fuel Standard
Renewable Diesel Takes Smaller Cut Jim Lane “EPA continues to assert authority under the general waiver provision to reduce biofuel volumes based on available infrastructure,” says BIO. “This is a point that will have to be litigated. It goes against Congressional intent.” In Washington, the EPA released its proposed standards for 2014, 2015, and 2016 and volumes for renewable fuels. The volumes, as widely expected, include substantial reductions from the statutory standards in the original 2007 Energy Independence & Security Act. The EPA also released a 2017 proposed standard for biomass-based diesel. Yet, while attracting significant...
Report Alleges EPA Tests Skewed Against Ethanol By Oil Industry Influence
by Jim Lane
In Washington, researchers for a report published by the Urban Air Initiative contend that “technical data that shows the nation has been exposed to decades of flawed test fuels and flawed driving tests, which in turn means flawed emissions results and mileage claims”. The complete Beyond a Reasonable Doubt series from UAI is available here.
Further, EPA emails obtained under the Freedom of Information Act reveal that, according to a report from Boyden Grey & Associates, the Agency appears to have directly solicited financial contributions and technical input, “especially on the fuel matrix,” from an oil industry controlled research organization.
Of the...
Where Are The Cellulosic Ethanol Gallons?
Jim Lane We've seen a number of high-profile cellulosic projects open in recent years, and not much ethanol being produced? Wondered why? Here are answers to your questions. As Jack Webb used to say on Dragnet, just the facts, ma’am. Fact one. There’s not much ethanol being produced at the new generation of cellulosic projects. Fact two. We have seen significant changes in senior leadership at a number of key developers. Industry rumor going around: Psst! These facts are linked! For sure, Dorio Giordano has been appointed CEO at Beta Renewables, Dan Cummings has been...
The Proof in Ceres’ Pudding
by Debra Fiakas CFA Judging by stock prices, investors have decided Ceres, Inc. (CERE: Nasdaq) is the favorite horse in the cellulosic ethanol race - at least among those that have publicly traded stocks. Ceres develops and sells sorghum, switch grass and miscanthus seeds to feedstock growers that supply cellulosic ethanol mills. The stock is selling for a buck and change, which is far more impressive that the stocks of most companies that could be included in the “cellulosic biofuel” sector. Ceres announced fiscal second quarter 2014 results at the beginning of this month. The company...
ADM raises capacity of N. Dakota biodiesel plant
Archer-Daniels-Midland Co. (ADM) s increasing the capacity of a biodiesel plant under construction in North Dakota to 85 million gallons a year, a company spokesman said on Wednesday. ADM originally announced the plant in Velva would produce 50 million gallons of biodiesel a year using canola oil. ADM decided to increase capacity to take advantage of economies of scale, said Greg Webb, vice president of public affairs.
