Monday, July 26, 2010


For those of you just beginning your quest for more knowledge about Illinois agriculture (and maybe for some of you that work within the Illinois agricultural industry every day and just didn’t think through this particular issue), let me describe to you corn’s ethanol quandary.

Illinois farmers are really good at growing corn. They grow more and more corn every single year, using less inputs (less land, less water, less chemicals) to do it, and thus, they need more markets for this corn. This is one of the primary goals of the Illinois Corn Marketing Board – to develop markets for Illinois corn.

Corn-based ethanol is our largest Illinois market for corn and presents the most opportunity for growth, in turn, demanding more corn. This is good because we have corn coming out our ears. No pun intended.

Right now, nearly every gallon of gasoline that you purchase at the gas station is 90% gasoline and 10% ethanol; this product is referred to as a 10% blend. A 10% blend is the highest blend the EPA will allow. But we (Americans) have now reached the point where there are no more gallons of gasoline sold to blend 10% ethanol into, thus, the market is no longer growing and we have more and more corn that will be losing its value.

The ethanol industry has asked EPA to consider a higher blend of ethanol in every gallon of gasoline. They suggested 15%, which barely makes a difference per gallon of gasoline, but makes a huge difference to the ethanol industry and thus, to corn farmers in Illinois. This opens up more market space for ethanol and for the corn that creates it.

The EPA, being the EPA, has hesitated to approve a 15% blend. They argue that testing data from US Department of Energy on what a 15% blend really means hasn’t been provided to them.

In response to their stalling, the National Corn Growers Association, the American Coalition for Ethanol, and the Renewable Fuels Association sent a letter today asking US EPA Administrator Lisa Jackson to consider an immediate move to a 12% blend which opens up a market for ethanol and allows existing plants to keep … well … existing.

The bottom line for corn farmers is that we need additional markets for corn or corn farmers will go out of business.

The bottom line for environmentalists is that we need a green, renewable fuel supply to address climate change and emissions concerns.

The bottom line for Americans is that we need domestic energy so we can reduce our oil imports and quit funding the countries that hate us.

The bottom line for the US EPA is that a 12% blend of ethanol moves us a step in the right direction. And frankly, if underdeveloped and developing countries can make an investment in green, renewable, domestic energy and Brazil can use up to 23% ethanol blends in their conventional vehicles with no problems … why can’t we?

Dave Loos
ICGA/ICMB Research and Business Development Director
(and ethanol guru!)

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