Historically, distillers grain represented 10 percent of an ethanol plant's revenue stream, said Jerry Shurson, an animal science professor at the University of Minnesota. Today, it's closer to 20 percent to 25 percent, he said.
What's more, the parliamentary committee is demanding that, before 2015, a full review of the whole EU biofuel promotion policy and its social and environmental impacts be carried out to determine whether the targets need revising. This review should "focus on consequences for food security, biodiversity and the availability of electricity or hydrogen from renewable sources, biogas or transport fuels from ligno-cellulosic biomass and algae," the text reads.
This flies in the face of much of the current thrust of European biofuel industry, and will create uncertainty in the market. That is not completely a bad thing. The difficulty for many existing companies and the trade associations that represent them centres around their needs to keep shareholder/proprietors happy quarter to quarter and year to year. The Parliament, by voting in this way, is hoping to develop a rounded robust biofuels sector that will have little or no impact on food supplies. This has to be preferable in the long term to a biofuel sector that competes for food crops.
The one thing that I don't like about the vote is that it adds in electricity and hydrogen. I especialy doubt that hydrogen will be a sustainable fuel untill we develop bacteria/algae to produce it from organic material without generating carbon dioxide. Hydrogen is bad because it is currently made using electicity, so the process is less efficicnt than electricity production. There is little or no infrastructure in place to get hydrogen to the point of need.
The European Parliament's powers vary from area to area, for example, if this decision is seen in the context of agriculture, then parliament can only give its opinion to the Council of Ministers. If its a non-sensitive area then the Council and Parliament have to agree. If there are any experts in the rolls of Council and Parliament out there, I'd like to hear from you.
So where do the Malaysians fit into all of this... They are concerned that the poposed increases in carbon savings that are also included in the parliament's decison will leave palm and soy oil out in the cold. They might neet to lobby national governements, or be much more imaginative.
The USDA said in its monthly report it expects 12.07bn bushels of corn in the 2008/09 crop year. That projection compares with a crop of 13.1bn bushels in 2007/08, the record harvest by US farmers.
USDA expects ethanol producers to consume 4.1bn bushels of corn in 2008/09. That projection is unchanged from a month ago. In 2007/08, the
used about 3bn bushels of corn to produce ethanol. US
That's around 34% of the crop to make ethanol, and by my calaculation that will reduce the amount of corn or corn products like distillers grains available for food use by around 2.7 bn bushels, taking the effective crop level closer to 10bn bushels.
I don't know what the long term effect that will have on the price of corn, but on Friday last week, when William wrote his story, he tells us
The USDA raised its 2008/09 average corn price forecast by 10 cents/bushel to a range of $5.00-6.00/bushel (€3.60-4.32/bushel) in its latest report. US corn prices as assessed by the USDA averaged $4.25/bushel in 2007/08.
Based on these assumptions, and excluding the impact of other factors, we would expect to incur a net loss for the third quarter of 2008 in the range of between $63 million ($0.40 per share) and $103 million ($0.65 per share).
Corn supplies are projected to fall by one-third to just more that 1 billion bushels, or about one month's consumption, when harvest starts next fall. Supplies could be even tighter; many analysts think the latest production forecast is overly optimistic.
But the real key to keeping the United States from running short on corn and soybeans may lie in South America, and how many acres farmers in Brazil and Argentina plant to soybeans in coming months. If they increase acreage significantly, that could ease soybean prices and steer U.S. farmers to more corn next spring, economists say.