Thank the Ethanol Hoax for higher malt prices

[fifelee]

Don't sell ethanol and American ingenuity short just yet. We are in the infancy of mass produced bio-fuel. In time after the infrastructure is built up there will be huge break throughs. Such advancements are already happening:

http://www.gm-volt.com/2008/01/13/g...kthrough-by-new-partner-coskata-inc/#more-730

Bio-fuels have the potential to be a great thing for the environment and you pocket book. Just give the bright mind is this country some time.

 

[skinfiddler]

That false statement is another one that people love to float around. We get most of our oil from Canada, Mexico and Venezuela. Less then 20% of all American oil imports come from Arab countries and most of that comes from Saudi Arabia.

Source: http://www.eia.doe.gov/pub/oil_gas/...ons/company_level_imports/current/import.html

"I would drill through the frakin Caribou for oil if it meant moving our dependence from all foreign sources." Fixed



Better reason for singling out SA: I don't see Canadian, Mexican and Venezuelan countries funding terrorism against the west (yet).

Moreover how is it possibly a good thing to be dependent on any other nation for energy if we don't have to.

Still there is nothing out there to replace fossil fuels and if you want to see the price of fuel drop $2/g tomorrow announce today that we are making a "Manhattan Project" out of drilling and refining our own oil sources.

 

[Cookiebaggs]

I'm not trying to be ultra liberal or enviro or something, but there is so many other options out there that don't involved doing that type of destruction. And I can't stand the profits they're turning right now too!

Would you rather see them turning a loss? Many people are invested in oil companies. Incuding those that ***** about the profits.

Could it be that the record oil company profits are a direct result of increased demand and a resulting higher volume of gas produced rather than higher margins?

Example: 10% margin on 10,000 barrels vs. 10% margin on 20,000 barrels. larger profit due to volume (demand) increase but the same margin of profit.

 

[EdWort]

Don't sell ethanol and American ingenuity short just yet. We are in the infancy of mass produced bio-fuel. In time after the infrastructure is built up there will be huge break throughs. Such advancements are already happening:

http://www.gm-volt.com/2008/01/13/gm-announces-ethanol-from-renewables-production-breakthrough-by-new-partner-coskata-inc/#more-730

Bio-fuels have the potential to be a great thing for the environment and you pocket book. Just give the bright mind is this country some time.

I don't understand where the potential is. It uses more fuel to produce than it makes (net fuel loss for each gallon), it makes more pollution, it is less efficient which means you must use more to go the same distance, it wastes tons of water (literally), and it is driving up the prices of food and beer.

Who is getting rich off this scam and who is benefiting? Not ordinary Americans and not the environment. I do not see a single benefit for this scam except for lobbyists, and folks like Archer Daniels Midland, and ConAgra etc.

 

[wihophead]

Would you rather see them turning a loss? Many people are invested in oil companies. Incuding those that ***** about the profits.

Could it be that the record oil company profits are a direct result of increased demand and a resulting higher volume of gas produced rather than higher margins?

Example: 10% margin on 10,000 barrels vs. 10% margin on 20,000 barrels. larger profit due to volume (demand) increase but the same margin of profit.

You hit the nail on the head.....here is an article I received from The Motley Fool last year...you missed the margin for EXXON by .4%....LOL

http://www.fool.com/investing/gener...+oil+profits&vstest=search_042607_linkdefault

 

[EdWort]

Let's not forget the taxes local, state & federal governments extract out of every gallon. No one seems to complain about their "windfall" from increased demand.

 

[fifelee]

I don't understand where the potential is. It uses more fuel to produce than it makes (net fuel loss for each gallon), it makes more pollution, it is less efficient which means you must use more to go the same distance, it wastes tons of water (literally), and it is driving up the prices of food and beer.

Who is getting rich off this scam and who is benefiting? Not ordinary Americans and not the environment. I do not see a single benefit for this scam except for lobbyists, and folks like Archer Daniels Midland, and ConAgra etc.

Not to sound rude, but did you read the link? Also check out Coskata.com. They have perfected a better way to make ethanol and are in the process of opening plants. They don't use the corn, they will use the the corn stock, or old tires or any organic waste. There process only uses 1 gallon of water per gallon of ethanol and they claim they can get 7.7 units of energy for every 1 unit of input. Check out there FAQ http://www.coskata.com/AboutFAQ.asp. American ingenuity can make ethanol viable if we give it a chance and don't shut it down first.

P.S. I really enjoy Walter Williams and read all his articles. He makes economic understandable to the common man.
P.S. love the apfelwein

 

[EdWort]

Not to sound rude, but did you read the link?

Nope. Good info, now that I have read it. My rant is about corn ethanol and what it is doing to our economy, food prices, my wallet, and beer.

It looks like Coskata is well positioned to take advantage of the enery mandates set by congress.

 

[fifelee]

Nope. Good info, now that I have read it. My rant is about corn ethanol and what it is doing to our economy, food prices, my wallet, and beer.

It looks like Coskata is well positioned to take advantage of the enery mandates set by congress.

I agree corn ethanol is not very good on its own, but I see it is a necessary evil to get the infrastructure established and give time for invention. In ten years I predict very little ethanol will be made from corn because more economical ways will be found.

 

[Nurmey]

I agree corn ethanol is not very good on its own, but I see it is a necessary evil to get the infrastructure established and give time for invention. In ten years I predict very little ethanol will be made from corn because more economical ways will be found.

We can only hope you are correct that the junk science behind using corn will die. Here is a little geekyness on ethanol.

Corn (annual) produces 400 gallons of ethanol per acre. Switch grass (native perennial) produces 1100 gallons of ethanol per acre. To make ethanol you use 100% of the Switch grass as opposed to just the seeds of corn. Mow down switch grass and it grows back. Switch grass can be grown on land not currently used for edible plants. Now which one of this products sounds better to use in ethanol production?

 

[EdWort]

We can only hope you are correct that the junk science behind using corn will die. Here is a little geekyness on ethanol.

Corn (annual) produces 400 gallons of ethanol per acre. Switch grass (native perennial) produces 1100 gallons of ethanol per acre. To make ethanol you use 100% of the Switch grass as opposed to just the seeds of corn. Mow down switch grass and it grows back. Switch grass can be grown on land not currently used for edible plants. Now which one of this products sounds better to use in ethanol production?

yeah, and I bet you can get at least 4 harvests of Switch Grass a year to boot!

 

[wihophead]

yeah, and I bet you can get at least 4 harvests of Switch Grass a year to boot!

It also doesn't require the amount of fertilizer that corn does which is being blamed for the expansion of the Gulf of Mexico dead zone.

 

[PeteOz77]

It makes good animal habitat as well, something that seems to be dwindling more every year.

 

[pjj2ba]

A lot of research $$$ from NSF, NIH and the DOE is currently being funneled into biofuels. It is the current hot area. As a brewer, we all know we must mash to convert the starches to sugar for the yeast to consume. The technology to do this is well understood. The big goal is to be able to EASILY convert cellulose (ie switch grass) into sugars for the yeast. This is much more difficult than converting starches which is why so much corn is being used right now. In the plant sciences the focus is on developing plants that produce more biomass and are easier to break down. This is not trivial. These traits are not necessarily in the plants best interest. Lignin content is a major stumbling block. It keeps plant stems strong, but it makes it them more difficult to breakdown the cellulose. Lignin also helps a plant defend itself from pests and disease. I am also aware that a lot of work is being done with microbes other than yeast and I hear reports of losts of research $$ looking into the concentrating steps to avoid the high energy cost of distillation

 

[CBBaron]

We can only hope you are correct that the junk science behind using corn will die. Here is a little geekyness on ethanol.

Corn (annual) produces 400 gallons of ethanol per acre. Switch grass (native perennial) produces 1100 gallons of ethanol per acre. To make ethanol you use 100% of the Switch grass as opposed to just the seeds of corn. Mow down switch grass and it grows back. Switch grass can be grown on land not currently used for edible plants. Now which one of this products sounds better to use in ethanol production?

Thats great, except that the starches in corn are much more readily available and much easier to process into ethanol. Corn is used for ethanol in the US because it is a product that we produced in excess in the past, has a high yield per acre and is easily processed for alcohol. Switch grass sounds like a great biofuel resource but we do not yet have a way to economically process the grass into alcohol on a large industrial scale.
There are a number of companies and government sponsored organizations researching the processes required but we are still years away.

Our grain prices are going up for several reasons:
1. Increased cost of shipping due to rising fuel prices.
2. Increased overseas demand due to weak dollar and increased wealth in developing countries
3. Increased use of corn in ethanol plants.

The ethanol plants is actually the least of the problems and the one most likely to be cut back as grain prices increase. Even with the government incentives of corn ethanol it took the big oil price increases of the last few years to make ethanol a profitable product. If corn prices continue to increase faster than oil then the equation will change again and the ethanol plants will cut back or try to switch to other raw materials.

As for water in ethanol and pipe line problems. It is not the water in the ethanol that causes corrosion. Ethanol appears to mildly corrosive itself to some metals which makes pipelines somewhat problematic. Additionally pipeline networks tend to allow some water into the ethanol which ethanol will absorb making it less suitable as fuel. This happens to other pipeline products also but oil based fuels do not absorb water.

I'm wondering where the article in the OP gets his water usage numbers from. I can only guess the article is refering to the water used by the corn when growing. I believe most of the corn grown in the US is grown without irrigation so that water usage is natural rain fall. The water used in the manufacturing of ethanol should be easily recycled using common sewage treatment methods. My guess is that most of it is recycled in the same plant.

Does corn ethanol make economic and environmental sense? Probably not. But it is not near as evil as some are making it out to be and the alternative biofuel sources are not yet available. The only alternative that is viable currently is conservation but that isn't all that likely in a large scale either. For now I will continue to do my part by riding my bike to work and limiting our family auto usage to <10k miles a year in a compact car.

Craig

 

[wihophead]

I'm wondering where the article in the OP gets his water usage numbers from. I can only guess the article is refering to the water used by the corn when growing. I believe most of the corn grown in the US is grown without irrigation so that water usage is natural rain fall. The water used in the manufacturing of ethanol should be easily recycled using common sewage treatment methods. My guess is that most of it is recycled in the same plant.

That is plant utilization, it is not a perfect process so water in does not equal water out. It is public knowledge that the accepted industry-wide average is about 4.2 gallons of water used for every gallon of ethanol produced.

Here is some info on water usage...
http://www.agobservatory.org/library.cfm?refid=89449

 

[fifelee]

Switch grass sounds like a great biofuel resource but we do not yet have a way to economically process the grass into alcohol on a large industrial scale.

Craig

It isn't as far away as you think. First plant open 2010.
http://media.cleantech.com/2414/coskata-icm-to-build-ethanol-plant

 

[CBBaron]

That is plant utilization, it is not a perfect process so water in does not equal water out. It is public knowledge that the accepted industry-wide average is about 4.2 gallons of water used for every gallon of ethanol produced.

Here is some info on water usage...
http://www.agobservatory.org/library.cfm?refid=89449

That number sounds much more reasonable but the OP quoted

It takes 1,700 gallons of water to produce one gallon of ethanol.

Which sounds absurd to me.

Craig

 

[CBBaron]

It isn't as far away as you think. First plant open 2010.
http://media.cleantech.com/2414/coskata-icm-to-build-ethanol-plant

Sounds very promising. However like I said it is still years away. If this plant proves to be economical then I would expect it to be replicated fairly quickly but large scale production using switch grass and other resources would still be several years later.
I am always hopeful.
Craig

 

[CBBaron]

yeah, and I bet you can get at least 4 harvests of Switch Grass a year to boot!

Ed I believe the 1100 gals/acre/year quoted is based on multiple harvests. That is usually how yields are listed for agriculture products.
Still switch grass is a promising feed stock for ethanol if it can be economically processed.

Craig

 

[srm775]

I don't understand where the potential is. It uses more fuel to produce than it makes (net fuel loss for each gallon), it makes more pollution, it is less efficient which means you must use more to go the same distance, it wastes tons of water (literally), and it is driving up the prices of food and beer.

I think the point of the OP is that ethanol production is in it's infancy. As it matures, breakthroughs will happen and it will become a much more efficient fuel to produce. Just like when oil, coal and natural gas were in their infancies, it took much more to labor/fuel to produce a gal/pound that was actually extracted. Given time for infrastructure and advancements in production, ethanol could be a very viable source.

Ethanol, however, is not at all responsible for the higher prices in food and/or beer. You want to blame something, blame the soaring costs of oil. Ethanol production last year was the same as it's been in the past five years. It's the costs to produce, package (in plastic made from oil) and ship (using gas and diesel) food products that is driving up the costs of food. Another big reason for the skyrocketing costs of food is the declining value of the dollar. Products imported are no longer as cheap as they used to be and those costs are passed on to the consumer.

 

[MikeFlynn74]

You want to blame something, blame the soaring costs of oil.

Or the fact that the dollar is worthless right now

 

[wihophead]

http://www.journaltimes.com/articles/2008/03/25/local_news/doc47e80ebdc06fb279079406.txt

 

[uuurang]

There's something else wrong with this picture. If Congress and President Bush say we need less reliance on oil and greater use of renewable fuels, then why would Congress impose a stiff tariff, 54 cents a gallon, on ethanol from Brazil? Brazilian ethanol, by the way, is produced from sugar cane and is far more energy efficient, cleaner and cheaper to produce.

Aren't we just trying to play catch up with Brazil? They have had great success, according to news articles I've read in the past, using cane sugar and or beet(?), not positive about the beet sugar.

Is regular sugar that much more efficient than corn sugar?

 

[MikeFlynn74]

Is regular sugar that much more efficient than corn sugar?

The sugar production from Cane is 50X that of corn.

 

[zoebisch01]

Ethanol is a joke if we seriously want to look at using Corn. Let me say something about Corn. Corn is ONE OF THE MOST INEFFICIENT CROPS. If they really want to do something about it, grow Sugar Beets. The reason Brazil is so successful is (as has been stated), Sugar Cane is a much more viable source for Ethanol AND more importantly, that is an abundant crop there. They didn't have to retool to grow Sugar Cane. Here, I think the justification for using Corn is that we have all the machinery and historically have grown Corn. Problem is, like I mention...Corn is one of the worst things to grow. It should be a luxury crop.

 

[Philip1993]

And I can't stand the profits they're turning right now too!

<sarcasm>
Yea, that 10.9% profit margin is absurd. Who do they think they are, WalMart!!

Just think about it; It we didn't already have the government taking 41% of their earnings, they would be making as much money as McDonalds!

Greedy bast***s. If they wanna go make 10.9%, they should just shut down their refineries and go invest their money in the stock market like the rest of us.

</sarcasm>

 

[pjj2ba]

I went to a seminar about a month ago from a Brazilian scientist doing a short sabbatical here. He is heavily involved in the sugar cane to ethanol research. Brazil started their project in the mid 80's. At that time it was heavily subsidized. They slowly weaned off the subsidy in the late 90's and there was a price jump and some black years, but now the with some help from even better conversion efficiencies the industry in Brazil is doing a great job and is no longer in any need of price supports.

Our society is too interested in magic bullets and instant satisfaction. These kinds of things take time and it might not be pretty in the mean time.

 

[jdoiv]

Two words for you:

Bio-diesel Hybrids


renewable and most efficient use of energy.

 

[zoebisch01]

I went to a seminar about a month ago from a Brazilian scientist doing a short sabbatical here. He is heavily involved in the sugar cane to ethanol research. Brazil started their project in the mid 80's. At that time it was heavily subsidized. They slowly weaned off the subsidy in the late 90's and there was a price jump and some black years, but now the with some help from even better conversion efficiencies the industry in Brazil is doing a great job and is no longer in any need of price supports.

Our society is too interested in magic bullets and instant satisfaction. These kinds of things take time and it might not be pretty in the mean time.

Good info. You know, that's the problem here (aside from the magic bullet statement) is that we never seem to wean ourselves from subsidies...could be just my perception though. It makes sense with the time frame. Migrations and corrections to an economy/infrastructure can take a long time. The article I was reading the other day about the world food shortage issues stated it will probably take a decade to correct.

 

[MikeFlynn74]

<sarcasm>
Yea, that 10.9% profit margin is absurd. Who do they think they are, WalMart!!

Just think about it; It we didn't already have the government taking 41% of their earnings, they would be making as much money as McDonalds!

Greedy bast***s. If they wanna go make 10.9%, they should just shut down their refineries and go invest their money in the stock market like the rest of us.

</sarcasm>

Looks like you drank the KoolAid.

Profit margins % are not impressive but up 50% from what they were while spending has gone down. To total revenue is way up.

They also can reduce what looks like profit by creative expenditures and buying back stocks as well. So hey dont let facts tell the whole story

 

[Junebug]

I read somewhere that if every single acre of arable land in the U.S. was used to grow corn for ethanol, it would only address 20% of our fuel needs. Pretty inefficient.

 

[PeteOz77]

I was VERY surprised when I went home to Minnesota last year and one of my old mates told me that he had installed a CORN FURNACE. I said "You mean you burn corn straight out of the field?" He said "yeah! It's great and it's CHEAP to run!"

I replied with.. "But man... corn is FOOD. There are millions of people all over the world that are starving, and you are burning FOOD in your furnace to keep warm?" He replies with "Ah, F**K em. It's not MY fault they don't have any food"

I was less than impressed

 

[Beerthoven]

Most depressing thread ever. We are all doomed.

 

[srm775]

I replied with.. "But man... corn is FOOD. There are millions of people all over the world that are starving, and you are burning FOOD in your furnace to keep warm?" He replies with "Ah, F**K em. It's not MY fault they don't have any food"
I was less than impressed

That's awesome.

 

[srm775]

<sarcasm>
Yea, that 10.9% profit margin is absurd. Who do they think they are, WalMart!!

Just think about it; It we didn't already have the government taking 41% of their earnings, they would be making as much money as McDonalds!

Greedy bast***s. If they wanna go make 10.9%, they should just shut down their refineries and go invest their money in the stock market like the rest of us.

</sarcasm>

Well, when you post a 10 Billion (that's with a "b") QUARTERLY (that's only three f'in months) profit, then something isn't adding up.

 

[McKBrew]

Well, when you post a 10 Billion (that's with a "b") QUARTERLY (that's only three f'in months) profit, then something isn't adding up.

It adds up everytime I stick that thing it my gas tank and pull the lever, while at the same time feeling like an unseen force is sticking something up me.

 

[blacklab]

The interesting thing is that the people behind the eco movement are all about the ethanol, but it's really just switching the burden from fossil fuels to other expendable resources, hence Ed's comments in the OP about the amount of water/electricity/etc. needed to convert the corn to useable fuel.

If we want power which does not drain the resources of our planet, we need to look OUTSIDE of our planet. It's a closed f'ing system, people! The laws of thermodynamics(I think) say it is impossible to extract energy from a material without destroying that material! Energy within a closed system cannot be created or destroyed, only converted. Corn is just another vehicle for the net amount of energy available on Earth. How about solar power? The sun is free!

I'm not saying that solar is the end all solution, but it seems even partial utilization would lighten the burden on our constrained resources.

 

[PeteOz77]

How about solar power? The sun is free!

I'm not saying that solar is the end all solution, but it seems even partial utilization would lighten the burden on our constrained resources.

But what if I want to drive my car at night? /s

 

[blacklab]

But what if I want to drive my car at night? /s

Then it would be powered by fossil fuels at night, and the sun(somehow) during the day. 50% savings.

Although I think you knew that?