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John Adam submits:Sweet sorghum is a much better ethanol feed stock than corn or switchgrass cellulose. Sweet sorghum has been grown in the US midwest for over a hundred years, originally for molasses as a substitute for cane sugar. It can produce almost as much sugar as cane and it grows well anywhere that corn can be grown. In fact, it requires less water, fertilizer, pesticides, and human attention than corn and can be grown profitably where corn cannot. The same machinery used to produce alcohols from sugar cane can be used with sweet sorghum. Its waste material after juice extraction can be used in the same way as sugar cane waste. Cattle like to eat the waste cellulose and it can also be used to produce more ethanol, etc. Archer Daniels Midland (ADM) and VeraSun Energy (VSE) do not have to go to Brazil to start producing ethanol from sugar cane. Instead, they should talk to farmers about producing sweet sorghum instead of corn. In India, ethanol is already being produced from sweet sorghum. The CEOs running U.S. companies may think that they needed a few million Indian immigrants to handle their Y2K disaster, but surely our farmers can still grow sweet sorghum. Complete Story »
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Max Blankfeld submits:A few months I wrote about how the number of flex-fuel cars was increasing in Brazil and sugar-cane ethanol has been a thriving industry for years, without causing damage to food production. Fresh news related to the ethanol industry, both in the US and in Brazil, should point us to the direction where this industry will go in the coming years. Complete Story »
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Greentech Media submits: By Jeff St. John For a biofuel industry that's already gone through one boom-and-bust cycle in the span of the last four years – and hopes to see another boom start in the next four – the question of who will occupy the White House come January could be an important one. Complete Story »
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Paul Christopherson submits:Summary - Corn-based ethanol, which always was a mistake, is finally out of favor, and the crop price has fallen to $4/bu.
- This is just the beginning of a long-term secular decline in corn’s fortunes. First, the US fiscal wreckage will put pressure on its subsidy payments.
- Far more important, the cost of US health care will turn the debate to the causes of poor health itself, and the fact of our underlying poor diet.
- The corn-driven American diet is acting like a slow poison on us. With a lot of education, this will become better known, producing a profound change in habits, similar to the smoking cessation phenomenon.
- The resulting drop in demand for corn will mean a big retrenchment in the corn-related industries, negatively affecting:
Stocks - Potash Corp (POT) ($68.52), Fertilizers
- Mosaic Co. (MOS) ($27.78), Fertilizers
- Archer Daniels Midland (ADM) ($17.53 ), Corn refining
- Corn Products International (CPO) ($22.99), Corn refining
- E.I. duPont (DD) ($29.33), Corn seed, crop protection
- Monsanto Co. (MON) ($71.95), Corn seed, crop protection
- Syngenta (SYT) ($29.28), Corn seed, crop protection
- Deere & Co. (DE) ($30.36), Farm machinery
- CNH Global (CNH) ($12.22), Farm machinery
Our thesis is long term by nature, and will take years to prove out. In the short run, both corn itself and the industry participants (e.g., Deere) may have been oversold, caught up in the forced hedge fund liquidations. So, our present recommendation would be to watch for a recovery, and see it as a selling opportunity in what will become a troubled situation down the road. Research Perspective On October 1, this analyst wrote of the dubious merits of the bailout:-- Complete Story »
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 Konrad Imielinski submits: Corn prices settled below the $4 mark Wednesday for the first time since last October. December corn, the front-month contract, fell 23 1/4 cents to $3.88 per bushel. In the past month, corn prices have fallen $1.74 (31%) due to the rapid decline in both crude oil prices and the stock market. Luckily for U.S. ethanol producers, ethanol prices haven't been hit as badly as ethanol's crush spread has improved: (what do I mean by ethanol's crush spread?) Complete Story »
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 Tim Plaehn submits: A new study by the University of Nebraska shows that current ethanol production technology is 2 to 3 times more efficient than previously thought. Earlier studies focused on older, less efficient technologies and this new study helps allay the fears that corn ethanol production uses more energy than it provides. Here are some of the initial results from the study: Complete Story »
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Chris Damas submits:
Last week, ethanol producer VeraSun Energy (VSE) announced it put itself up for sale after blowing its brains out in the corn market. The company's practice of not buying corn requirements far ahead of time hit a brick wall when the June Midwest floods caused a major whipsaw in grain commodity prices. 
Complete Story »
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Konrad Imielinski submits: Good News:
As many of you already know, a major problem with ethanol is that it cannot be transported through existing pipelines because it is highly corrosive. It seems, though, that several companies have recently been working to fix this problem. The article states that Houston-based Kinder Morgan Energy Partners (EPL) plans to run a test batch of ethanol this month through its 105-mile long underground gasoline pipeline. If successful, the pipeline could be transporting ethanol on a commercial scale by year's end. Complete Story »
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Tim Plaehn submits: I have come across a couple of interesting news items recently that point towards continued viability and growth for the U.S. ethanol industry. As I have written in the past, I believe the U.S. corn based ethanol industry will grow as a viable part of the country’s vehicle fuel structure. The current environment of high corn prices is pushing these companies towards efficiency and innovation. The ground work they are laying now will lead to increased profitability as ethanol becomes a larger portion of total fuel consumption. The first item is this article about ethanol producer POET expanding into cellulosic ethanol. POET is a privately held ethanol producer that is one of the nations largest, producing over 1 billion gallons per year from 23 plants. The company has announced it has developed the technology to process the corn cobs for additional sugars to refine into ethanol. According to the press release, using the corn cob along with the corn will increase ethanol production by 11% per bushel and 27% per acre of corn. It will be a simple process for farmers to harvest the cobs along with the corn and transport the crops to POET’s ethanol facilities. Complete Story »
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 Todd Sullivan submits: Good news for ethanol producers like ADM (ADM), Verasun (VSE) and Pacifc Ethanol (PEIX).
The U.S. Department of Agriculture forecast that farmers will harvest 12.3 billion bushels of corn, up more than 570 million bushels from last month's estimate of 11.7 billion. That's down 6% from last year's record crop of 13.1 billion bushels, but 17% above the 2006 harvest. Complete Story »
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Money Morning submits: By Jason Simpkins
The Environmental Protection Agency has denied a request from several U.S. policymakers to temporarily waive ethanol requirements for gasoline in hopes of bringing down corn prices. Complete Story »
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Money Morning submits: By Jason Simpkins Archer Daniels Midland Co. (ADM), the nation’s largest ethanol producer, could begin shifting much of its biofuels operation to Brazil, as corn-based ethanol attracts continued political scrutiny in the United States. Complete Story »
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David White submits:In 2005, Congress approved the Energy Policy Act that mandates the use of ethanol in gasoline. The level was 4.7 billion gallons of ethanol for 2007. This will rise to 7.5 billion gallons in 2012. In fact, President Bush was pressing for an extension of this mandate to 35 billion gallons of ethanol by 2017. At first people thought this was a great idea for something to replace MTBE, or even just substitute in some way for regular gasoline. However, several problems have arisen since then. First, this is an incredibly inefficient way to produce a gasoline substitute. It is estimated that the diesel fuel needed to run the harvesters, the transportation equipment, etc. amounts to approximately one half of the total volume of ethanol produced. These harvesters are also producing smog, so we're not really saving there either. If you then consider that one gallon of ethanol has only about two thirds of the energy content of 1 gallon of gasoline (i.e. your gas mileage will be lower per gallon with more ethanol in the gas mix), the actual benefit of ethanol as an oil substitute is minimal (1 – 1/2 – 2/3 * 1/2 = 1/6). Add to this all of the other costs associated with ethanol production such as labor, etc. and you are really just digging a hole for yourself. Complete Story »
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