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Today's News

Novozymes launches new Spirizyme products for highest total sugar conversion

Biofuels Digest - Sun, 08/20/2017 - 9:24pm

In Denmark, Novozymes announced the launch of Spirizyme 2.0 T and Spirizyme Ultra T for the European ethanol market. The two products are part of the Spirizyme T Portfolio, glucoamylase enzymes with trehalase that deliver yield enhancing activities documented to provide the highest total sugar conversion in the industry.

The products have a low risk of process errors and can be easily integrated in the production. The portfolio is built on industry known glucoamylase blends, now with the addition of trehalase to further enhance performance.

Thomas Schrøder, Vice President of Biorefining Commercial for Novozymes said in the press release, “Reducing residual sugar, such as trehalose, through better conversion, generates up to EUR 850,000 more ethanol revenue for the plant. Extensive plant trials of the Spirizyme T products have shown that they reduce the amount of residual DP2 sugars by up to 70 percent.”

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Biofuel candidate needed for RETAC vacancy at STB

Biofuels Digest - Sun, 08/20/2017 - 9:21pm

In Washington, D.C., the Surface Transportation Board is looking for two candidates for vacancies on its Rail Energy Transportation Advisory Committee, one of which would represent the biofuels industry.

Specifically, they are looking for a biofuel feedstock grower or provider and biofuel refiner, processor and distributor to fill the biofuel vacancy. The other vacancy is for an “at-large” representative with relevant experience in the transportation of energy resources. Candidate suggestions are due August 30 via online on STB’s e-filing link on the STB website.

RETAC was established in 2007 and has 25 voting members that serve to provide advice and guidance to the STB and serve as a forum to discuss emerging issues regarding the transportation by rail of energy resources (like coal, ethanol, and other biofuels).


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Construction begins on Flint Hills Resources ethanol plant in Nebraska

Biofuels Digest - Sun, 08/20/2017 - 9:19pm

In Nebraska, construction is starting on the Flint Hills Resources ethanol plant in Fairmont to install a new, bolt-on technology, called Maximized Stillage Co-Products. The $50 million project is one of the largest investments in co-product upgrading technologies ever made by a dry mill ethanol manufacturer.

Once operational, the MSC technology will allow the plant to produce a high protein animal and fish feed ingredient from a portion of its distiller grains, a coproduct of ethanol manufacturing. Construction is expected to last about 12 months and create about 120 construction jobs. The plant will remain in operation during construction.

The Flint Hills Resources Fairmont plant buys 44 million bushels of corn annually to produce 125 million gallons of ethanol, 320,000 tons of distillers grains and more than 26 million pounds of distillers corn oil. The plant employs about 50 people.

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Ethanol production highest in 28 weeks

Biofuels Digest - Sun, 08/20/2017 - 9:16pm

In Washington, D.C., the Renewable Fuels Association reports that according to EIA data, ethanol production averaged 1.059 million barrels per day (b/d)—or 44.48 million gallons daily. That is up 46,000 b/d—a 4.6% jump from the week before and the highest volume in 28 weeks.

The four-week average for ethanol production increased to 1.021 million b/d for an annualized rate of 15.65 billion gallons. Stocks of ethanol were 21.8 million barrels. That is a 2.3% increase from last week. Imports of ethanol were 37,000 b/d after zero imports last week. This marks only the fourth week in a year that volumes were recorded. Total ethanol supply (production, stocks and imports) reached a new record at 17.72 billion gallons annualized, besting the prior high set on Aug. 19, 2016 (17.20 billion gallons).

Average weekly gasoline demand decreased 2.8% to 399.9 million gallons (9.522 million barrels) daily. This is equivalent to 146.0 billion gallons annualized. Refiner/blender input of ethanol increased 1.1% to 948,000 b/d, equivalent to 14.53 billion gallons annualized. Expressed as a percentage of daily gasoline demand, daily ethanol production increased to a 21-week high of 11.12%.

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Rapeseed oil prices set to firm up but palm oil prices declined

Biofuels Digest - Sun, 08/20/2017 - 9:13pm

In Germany, UFOP reports that vegetable oil prices on the European cash market diverged. While rapeseed oil firmed, palm oil declined sharply. Trends for the coming weeks are mixed.

Prices for rapeseed oil, soybean oil and sunflower oil continued to diverge. Whereas palm oil was on a continued downward trend due to abundant supply of feedstock, the price curve for rapeseed oil most recently was upward sloping again. According to information published by Agrarmarkt Informations-Gesellschaft mbH (AMI), rapeseed oil pricing was however difficult. Dissimilar levels of yield and quality have complicated oil millers’ rapeseed purchases during the ongoing 2017 harvest. Moreover, given the current price level, demand from buyers for rapeseed oil is moderate.

Since EU rapeseed production is smaller than expected, supplies could become increasingly expensive in the coming months, stabilising the upward trend of rapeseed oil prices. Prices of soybean oil will probably still remain volatile in August because of the US weather market. In contrast, sunflower oil is expected to slide slightly as harvest pressure commences to develop.

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Dyadic authorizes new stock repurchase program

Biofuels Digest - Sun, 08/20/2017 - 9:10pm

In Florida, Dyadic International, Inc. announced that its Board of Directors has authorized a new stock repurchase program, under which the Company may repurchase up to $5 million of its outstanding common stock.

Under this new stock repurchase program, Dyadic may repurchase shares in accordance with all applicable securities laws and regulations, including Rule 10b-18 of the Securities Exchange Act of 1934, as amended. The extent to which Dyadic repurchases its shares, and the timing of such repurchases, will depend upon a variety of factors, including market conditions, regulatory requirements and other corporate considerations, as determined by Dyadic’s management. The repurchase program may be extended, suspended or discontinued at any time. The Company expects to finance the program from existing cash resources.

Michael Tarnok, Dyadic’s Chairman said in the press release, “We believe that Dyadic’s stock does not reflect Dyadic’s growth prospects and the value of our proprietary C1 technology” and that “this new stock repurchase program provides the Company with an opportunity to provide liquidity to shareholders and increase shareholder value.”

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Algae derived biofuel in the works for Serbia thanks to NATO funding

Biofuels Digest - Sun, 08/20/2017 - 9:06pm

In Serbia, scientists are using a three year research project supported by the NATO Science for Peace and Security Program to commercially produce algae-derived biofuel as a way to improve their energy security.

They are working with Belgrade’s Institute for Multidisciplinary Research, Manchester University in the United Kingdom and Baylor University in the United States. Ivan Spasojevic, the project leader, told NATO “I expect that our results will encourage the development of green technologies in the energy sector. Successful completion of this project will, I believe, make it possible for fuel prices to drop by 1/5 in the next five years.”

NATO countries have invested over 15 million Euros in trust funds in addition to the SPS program to help Serbia with defense projects like safely destroy obsolete weapons, landmines and ammunition as well as military personnel retraining for civilian employment, and projects to help women in peace and security.

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New approach for potato waste to ethanol conversion

Biofuels Digest - Sun, 08/20/2017 - 9:03pm

In Pennsylvania, researchers from Penn State found a more efficient and less expensive way to convert potato waste into ethanol, which is good news for the more than 20 potato chip manufacturing companies located in the region.

By adding a bioreactor of mold and yeast while breaking down potato peels and residuals from complex carbohydrates to simple sugars and fermentation, researchers found it encouraged biofilm formation and larger numbers of microbes which helped improve ethanol production.

Ali Demirci, professor of agricultural and biological engineering, told Penn State News “This research is of great interest to Keystone Potato Products in Hegins, Pennsylvania, a subsidiary of Sterman Masser Inc. The company is paying attention to this project, hoping this novel approach may help it add more value to its waste potato mash. Industrial food wastes are potentially a great substrate in production of value-added products to reduce the cost, while managing the waste economically and environmentally.

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Major study says “Cut cellulosic ethanol out”, RFA says “No Way Jose”

Biofuels Digest - Sun, 08/20/2017 - 8:52pm

In Iowa, a new tractable multi-market model study finds that the RFS has substantially benefited the U.S. economy by lowering gasoline, crude oil prices, and crude oil imports, while increasing prices and benefits for corn and soy farmers and reducing U.S. greenhouse gas emissions.

But in their ‘what if there was no RFS?’ scenarios and predictions for the future, Iowa State University researchers made the recommendation that we increase ethanol production but decrease biodiesel and totally eliminate cellulosic ethanol in future mandates. Yep, you heard that right – totally cut out cellulosic ethanol from our future and lower biodiesel production, because it just ain’t worth it.

Those in the cellulosic ethanol and biodiesel industries, like the Renewable Fuels Association and National Biodiesel Board, are picking their chins up off the floor and asking “say what?” to those chopping block recommendations.

The backstory

In case you’ve missed what this study is all about, here’s a quick run-down. Iowa State University researchers asked what if there was no RFS in 2015 and projects 2022 mandates. They recommended a 2022 “biodiesel mandate of 1.8 billion gallons, zero mandates for cellulosic biofuel, and an overall renewable fuel mandate of 18.6 billion gallons implying an effective corn-based ethanol mandate of approximately 16.8 billion gallons).”

That’s an 18% increase in corn-based ethanol mandate and a drastic reduction of the advanced biofuel mandate, including zero cellulosic biofuel. That’s something a lot of us would have a hard time biting our teeth into.

Predicting the future is not easy, and while using history, data, market conditions, and pricing helps, the Digest, as well as the RFA and NBB, just don’t have 100% confidence in the 2022 predictions and recommendations that the study offers. As we’ve learned in the recent past, so many unexpected things can happen with markets, politics, and more, yet the study recommends totally obliterating cellulosic ethanol, decreasing biodiesel and only increasing corn-based ethanol. Really? Really.

The Digest caught up with Renewable Fuels Association VP Geoff Cooper who said, “The real value of this study is its 2015 results because it compares what actually happened in the real world with the RFS to a “counterfactual” scenario where the RFS didn’t exist.”

So what about the study’s recommendations for 2022? Cooper told the Digest, “The 2022 results are much less relevant and we don’t put much stock in them because both the “baseline” (with RFS) and no-RFS case are totally assumption-driven. They include some fairly pessimistic assumptions regarding the future development and economics of cellulosic and advanced biofuels between now and 2022, and there is too much uncertainty around those assumptions to put much stock in the 2022 numbers.”

What about the total annihilation of cellulosic ethanol? How does RFA feel about that? “We disagree with the study’s conclusion that there is only a limited role for cellulosic and advanced biofuels in the optimal scenario,” Cooper told the Digest. “Cellulosic and advanced biofuels will result in further GHG reductions and the costs of production for these fuels are falling and will continue to do so into the future.”

Why the hate towards biodiesel?

All is not hunky dory with biodiesel either as the study concludes that while we can shout hurray for ethanol, we should boo down biodiesel. Why does the study recommend “that corn ethanol production should be increased, whereas biodiesel production should be decreased”?

They assume that biodiesel is coming mostly from soybeans and “Because biodiesel biases demand of soybean products, the RFS increases soybean oil price by 49% whereas soybean meal price actually declines (by 3.6%).”

As we all know, biodiesel uses a variety of feedstocks like tallow, used cooking oil, vegetable oils and more, but the study assumed that 71% of biodiesel in 2015 was coming from vegetable oils with soybean oil the most widely used. The study then assumed that further expansions of biodiesel production would have to rely on redirecting vegetable oils from other uses and assumes much of it would come from virgin soy oil, but that isn’t necessarily the case.

For their 2022 forecast, the study predicts that biodiesel prices go up by $0.83 per gallon compared to only $0.05 per gallon price increase for ethanol, leading the researchers to say that “biodiesel produced from vegetable oil turns out to be a costly way to increase biofuel supply.” However, the study didn’t consider how RIN values have helped, and could further help, with competitive consumer pricing.

The Digest caught up with Jessica Robinson, Director of Communications for the National Biodiesel Board who agreed something seems amiss in the study’s slamming of biodiesel. Robinson told the Digest, “Countless environmental studies show biodiesel significantly reduces greenhouse gas emissions compared to petroleum diesel, and economic studies show positive impacts on rural communities and U.S. markets, due in part to the diversity of the feedstocks we can utilize. Though the study reinforces crop and livestock producers have benefited from biodiesel production, several assumptions miss the mark.”

The NBB was very clear in voicing its disagreement with the study and said “Created in a bipartisan law, the RFS is an effective method to create a renewable-fuels market and related high-value jobs here in the United States. This is a successful program worthy of continued support and growth.”

No agreement on GHG emissions either

But what about the environmental impact of the RFS? Surely the study finds that the RFS benefits the U.S. economy as well as GHG emissions, right?

Think again. “The RFS impact on reducing carbon emission, on the other hand, turns out to be nil once we account for the leakage effect (due to the induced increase in the rest of the world’s fossil fuel consumption),” according to the study.

RFA’s Cooper thinks the study’s environmental analysis on U.S. GHG emissions is a bit flawed and called this “rebound effect” as “twisted logic.” Cooper also points out that “the study appears to have neglected the likely effects of the Paris agreement” and that “the study’s GHG emissions are based on very conservative assumptions…they assume a 21% reduction for corn ethanol, when the latest study from Argonne says 35% and the latest from USDA says 43%.”

Apparently, the use of more biofuels does reduce U.S. carbon emissions by about 29 million tCO2e – hip, hip, hooray! However, the study said it is offset by increased worldwide emissions caused by the RFS based on lower crude oil prices which would increase the consumption of crude oil elsewhere in the world. Say what?!

This kind of logic is a bit strange – do we not continue the RFS or any policies that reduce oil consumption and prices because that will make everyone else in the world buy and use more oil? It’s like saying don’t stop buying plastic water bottles because it will make everyone else in the world buy more plastic water bottles and increase pollution.

Cooper is confident that “if the study had used more current assumptions from Argonne or USDA, we have no doubt that the U.S. GHG reductions would far outweigh any supposed GHG increases in the rest of the world.”

The numbers

Overall, the study finds that “Aggregate welfare at current mandate levels is larger than in the “No RFS” scenario by about $2.6 billion,” demonstrating that it sure was a good thing to have the RFS in 2015 with its assistance in boosting the U.S. economy.

As expected, the study found the biggest winner to be the U.S. agriculture sector which was boosted by $14.1 billion with the RFS compared to a case where no RFS existed in 2015. Corn prices with the RFS in 2015 were $3.68 per bushel, but in their scenario without the RFS corn prices would be just $2.75 per bushel, lower than the cost of production. Soybean prices would have been at just $9.23 per bushel without the RFS versus $10.10 with the RFS in 2015. That’s a 34% increase in corn price and a 9% increase in soybean price thanks to the RFS.

Gasoline consumers (that’s pretty much all of us, folks) made out pretty well with the RFS too. The study found that the RFS caused crude oil price to decline by 1.4% and gasoline prices to decline by 9.5% in 2015. Even better, the RFS helped create a small contraction domestic crude oil production and a larger decline in imports of crude oil of about 6%, meaning we rely less on oil from overseas improving our country’s energy security.

Bottom line

This study is sure to cause lots of controversy, especially in the cellulosic ethanol and biodiesel sectors. We expect to see others reviewing and critiquing the study in the coming weeks as they try to sort out the what-if scenarios presented in the study.

While the 2015 results show real data and benefits and is a pretty cool way to see what it would have been like without the RFS, we just can’t be certain about the study’s 2022 numbers and recommendations that are based on unpredictable futuristic assumptions.

In the meantime, Cooper from the RFA is confident that “the industry will soon have the capacity to produce the “optimal” volume of corn ethanol discussed in the study,” making at least the study’s recommended increased corn ethanol mandate for 2022 feasible and realistic.

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Value Days at the Landfill: The Digest 2017 Multi-Slide Guide to unlocking polylactic acid from waste biogas

Biofuels Digest - Sun, 08/20/2017 - 12:12pm

Methane in biogas offers a renewable alternative to natural gas as a feedstock and intermediate in bioprocesses. The US DOE is supporting a development effort led by NatureWorks in collaboration with Calysta to develop a commercially viable, disruptive fermentation process using methane in biogas and engineered methanotrophic bacteria for the production of lactic acid (HLA). Such a waste-to-energy process for the production of bioproducts can enable cost-competitive advanced biofuels production.

In this project, the team aims to demonstrate fermentation metrics at 2L scale that give lactic acid cost of goods produced (COGP) <$0.30/lbHLa, and NatureWorks’s Ken Williams presented this illuminating update at DOE Peer Review on progress to date.

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Targay launches turnkey 24/7 biodiesel solution

Biofuels Digest - Thu, 08/17/2017 - 6:42pm

In Canada, biofuels marketer Targray has announced the nationwide launch of its turnkey biodiesel solution for the convenience and fuel retailing segment. The announcement comes as increasing freight movement in the U.S. is spurring diesel demand throughout the country.

Created following a two-year pilot program and multiple rounds of customer consultations, Targray’s innovative 24/7 biodiesel solution for the convenience store segment provides a simplified approach to biofuel procurement that likens itself to purchasing standard diesel. It enables both chains and independently owned c-stores and fuel retailers to achieve a positive return on investment from their very first biodiesel order. Typical savings range anywhere from 3 to 10 cents per gallon of diesel sold, depending on regional market conditions and federal and state program eligibility.

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Bergen becomes second Norwegian airport to offer aviation biofuels

Biofuels Digest - Thu, 08/17/2017 - 6:41pm

In Norway, together with the opening of the new terminal at Flesland, sustainable biofuel has become available to airlines. “We are delighted to be only the second airport in Norway who are now making aviation biofuel available to airlines. This is an important step in establishing a market and infrastructure for the production and delivery of biofuel on a large scale”, said Aslak Sverdrup, Airport Director at Bergen Airport.

The fuel provider, AirBP, made its first biofuel delivery the night before the opening. Biofuel can be mixed directly with conventional fuel and no adjustments to the aircraft engines or distribution system are required.

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CoBank report says ethanol industry will soon face worsening margins that could lead to consolidation

Biofuels Digest - Thu, 08/17/2017 - 6:40pm

In Colorado, according to a new report from CoBank’s Knowledge Exchange Division, the ethanol market will soon face worsening slim-to-negative profit margins, which could potentially push the industry toward consolidation. However, producers that are well-capitalized with strong balance sheets and cash reserves will be in the best position to weather the softening market.

The report, “Ethanol’s Growth Path: Output and Export Uncertainties Both Rising,” outlines how an ethanol market fueled by corn prices at multi-year lows coupled with reinvestment into production capacity will push supply past demand growth.

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Greenbelt Resources trials technology with Puration for cannabidiol extraction

Biofuels Digest - Thu, 08/17/2017 - 6:39pm

In California, Greenbelt Resources Corporation announced that Puration, Inc. has selected its bioethanol to test for potential use in Puration’s patented CBD (cannabidiol) extraction method. Extraction methods commonly use ethanol but this will be the first time bioethanol produced from Greenbelt’s patent pending energy efficient membrane dehydration technology will be used in the process.

Puration Inc. recently entered into an agreement with NCM Biotech, Inc. that is a substantial upgrade to the two companies previous joint venture agreement. NCM Biotech has licensed to PURA the right to utilize NCM Biotech’s patented ethanol extraction process to produce cannabidiol extracts for infusion into recreational, fitness, wellness, alternative medicine and beauty products.

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Argent Energy turning UK’s fatbergs into biodiesel for buses

Biofuels Digest - Thu, 08/17/2017 - 6:37pm

In the UK, Argent Energy is taking fatbergs collected by the sewer companies and transforming them into biodiesel. Between 24% and 40% of the fatberg ends up as biodiesel after it has been melted down and separated into oil and grease. Currently, every week 30 metric tons of fatburgs from Birmingham are converted into biodiesel by the company but that should increase when the new upgrade allows it to process 300,000 tons of FOG annually. Around 7,000 buses across the country are currently fueled by the FOG-based biodiesel.

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Linde Group to create modular hydrogen manufacturing unit for St1 Refinery

Biofuels Digest - Thu, 08/17/2017 - 6:35pm

In Germany, the Linde Group has been awarded with the engineering and supply of a modular hydrogen manufacturing unit for St1 Refinery in Gothenburg, Sweden. Linde’s Engineering Division will start the engineering and construction of the unit immediately, with the completion estimated for the end of 2018.

“This award adds to Linde’s winning streak of Syngas & Hydrogen Solutions (Hydroprime®) for the renewable fuel industry,” said John van der Velden, Member of the Board of Directors of Linde Engineering Division. “Linde’s ability to deliver unique single-sourcing supplies provides St1 with a cost-effective solution supporting their advanced biofuel production.”

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Illinois to demo biofuel production from grasses collected from highway roadsides

Biofuels Digest - Thu, 08/17/2017 - 6:34pm

In Illinois, the Illinois Department of Transportation has approved implementation of a renewable energy demonstration project using grasses collected from mowing highway rights-of-way (ROW).

The work will implement the findings of a three-year study by a multi-disciplinary team including the Illinois Sustainable Technology Center at the Prairie Research Institute of the University of Illinois. The team concluded that nearly $2 million in energy could be recouped by harvesting the biofuel for energy. They also calculated that this would not only offset the cost of mowing, but also generate net revenue.

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Nebraska’s governor touts future of E15 at AEC annual convention

Biofuels Digest - Thu, 08/17/2017 - 6:33pm

In Nebraska, the governor waved the flag for higher ethanol blends during the American Ethanol Coalition’s annual conference in Omaha, saying the value addition that come from ethanol not only creates jobs but attracts investment to rural communities that in turn keep them strong. He says ethanol is at the heart of the state’s “golden triangle” of corn and cattle. The roughly two dozen ethanol in the state bring around in around $5 billion annually.

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Transformation time for Brazilian energy, agriculture

Biofuels Digest - Thu, 08/17/2017 - 11:52am

FS Bioenergia is the first corn-only ethanol production facility in Brazil.

There he goes again. Bruce Rastetter, that is.

It wasn’t enough to be one of the transformers of the US ethanol industry with the development of Hawkeye Renewables and its 450 million gallons of capacity. When Thomas H. Lee Partners bought 80% of the company in 2006 for a reported $312 million (some sources put the price, crazily, as high as $1 billion, which only fueled the frenzy more), Hawkeye became one of the central players in the Wall Street ethanol boom.

Not enough to assemble a huge, privately-held set of crop, cattle and pork companies in the US. Or to be a perennial short-lister for Ag Secretary within GOP insider circles.

Now he’s gone and set up a JV and built a plant with Fiagril that will rock the Brazilian biofuels industry. By introducing corn-only ethanol there, that is.

The project

Specifically, the $155M FS Bioenergia corn ethanol production facility opened this week in Lucas do Rio Verde, Mato Grosso. It’s the first large-scale corn ethanol production plant in Brazil and is the result of an international collaboration between Brazilian agribusiness Fiagril and U.S.-based Summit Agricultural Group headquartered in Alden, Iowa.

In its initial phase of operations, FS Bioenergia will annually process 22 million bushels of corn and produce more than 60 million gallons of corn ethanol, 6,200 tons of corn oil and 170,000 tons of valuable feed rations for Brazil’s growing livestock industry. By 2018, FS Bioenergia’s second phase of operations will increase corn processing and ethanol production two-fold.

Another view of the FS Bioenergia plant

Summit Agricultural Group and Fiagril broke ground on the corn-only ethanol production facility in early 2016. FS Bioenergia will employ roughly 150 full-time workers. In addition to ethanol and co-products for livestock feed, the ethanol facility will generate 60,000 megawatts of electricity to the local power grid.

As Rastetter explained to The Digest:

“When we sold Hawkeye in 2011, it gave me for the first time an opportunity to travel, and in traveling to Brazil we saw the double crop, without irrigation, that you can harvest in Brazil. We saw a growing success with corn that would continue to accelerate. Brazil already had the same soybean yield as the US, and with corn as a second crop, they can use the same ground, same machinery and get the benefit of two crops.

“If you think about it, it used to be around 50/50 in Iowa, but now it is often 80 percent corn and 20 percent soybeans, but there is still a lot of rotation to prevent a disease build up, and the soy nitrogen fixation does carry over for corn in Iowa. So we started asking, how big could Brazil go with corn? And I asked ICM to come down with me to look at the opportunities.”

What Rastetter was seeing was the transformation of the middle-north section of Mato Grosso state into the largest grain producing region in the country — a movement which started in the late 1980s with an intensification of settlement.

The vast tropical savannah of Brazil, spreading across Goias, Mato Grosso, Mato Grosso do Sul, Tocantins and into Minas Gerais, was known for poor soil fertility, even though it is perhaps the most biologically rich regions in the world with some 10.000 plant species. Developing the Mato Grosso region, sustainably, has been a major Brazilian project over the past decades — and Fiagril has been at the heart of it.

In Brazil, Rastetter and Marino Franz, founder of Fiagril, were quickly introduced. Fiagril had already long transformed itself into a diversified agribusiness aimed at value-add — owning, for example, a biodiesel plant. Fiagril and Rastetter’s Summit Ag Group found much in common. Ultimately, a JV was formed.

See the project video

In 3 minutes, the whole project, including a fascinating time-lapse of construction, right here.

Fiagrils’s sale to Shanghai Pengxin Group

Yes, last year Shanghai Pengxin Group purchased a 57 percent controlling stake in Fiagril — but the $290M deal excluded the company’s shipping, biofuels and seed production units — focusing instead on its grains purchasing, trading and fertilizer and pesticide operations.

The ICM relationship

FS Bioenergia utilized process technologies from ICM. Since 1995, ICM has provided engineering, construction and operational services for more than 100 ethanol plants in North America.  But that company had itself been transformed from a designer of first-generation ethanol plants into a company with diversified and advanced technology that extracts value far more efficiently than just a decade ago.

So, Brazil would not only have the advantage in sustainable feedstock production through double-crop annual rotation — but would be home to a spanking-new ICM technology set at the $115M plant that was ultimately constructed.

The target for ethanol? As Rastetter explained to us — it’s neither the export market nor the traditional vehicle bastion of Brazil around the centers like Rio or Sao Paulo. Think north — think of the growth in the cities nearer the Amazon region.

“If you look at Brazil,” Rastetter said, “it’s a smaller market than the US with around 6.5 billion gallons compared to 15 in the US, but there is 27.5% blending and every car is flex-fuel and can burn up to 100 percent ethanol, so cars are allowed to choose, and that way you can flex the demand.  But last year, the country imported 500M gallons into the Amazon [because the production is far to the south]. We’re a far northern plant, and that’s our market.”

What about distiller’s grains? Not a factor in sugarcane ethanol, but a critical factor in corn ethanol. Worth noting that Brazil Foods has modern pork and chicken facilities right there, and a number of hog operations and significant cattle. With new ICM innovations in protein that we covered here, expect that the venture will have solutions for all those sectors. And in Fiagril a ready customer for corn oil for biodiesel.

Comparing Brazil and the US

What’s different, we asked Rastetter, between developing a project in the US and Brazil? From technology to culture. Rastetter immediately zeroed in on culture.

“Technologically, it isn’t a lot different from the US — yes, we had to make sure we matched in Brazil the specs with the ICM specs developed originally for the US.  But in Brazil there’s been an embrace of ethanol.And we saw it at the opening. An amazing support from the public and support from the government. We had the president, the agriculture minister, 8 state governors, two federal senators, and I think every mayor in Mato Grosso. Plus, we had 1200 farmers and suppliers. Plus major companies like Case, DuPont and John Deere, that are well established down there already. It’s interesting how well the large farmers use US technology. They have this ability to study and accept innovation and adapt it to their needs, and do so in a very efficient way. It’s impressive.”

FS Bioenergia CEO Henrique Ubrig will run the JV and this first project.

What’s next?

Expansion, or a one-off?

“We plan to grow the platform,” Rastetter said, “but in a smart way, and we’ll continue to build the management team. We’ll focus in on the Mato Grosso region where there is that intense corn production and an ability to expand that, and well watch of course the growers there in terms of  continuing to plant corn in this price environment – that will impact our growth plans.

There’s good reason for optimism. Bank of America recently estimated that annual ethanol sales in Brazil could reach 13.5 billion U.S. gallons in 2022, two-thirds greater than the 8.1 billion gallons estimated in sugar cane ethanol production in 2016.

Fiagril’s Take

“This is a transformative moment for both agriculture and the renewable fuels industry in Brazil, said Marino Franz, founder of Fiagril. “FS Bioenergia will not only meet Brazil’s growing demand for ethanol but it sets the stage for Mato Grosso to become a global leader in the production of corn ethanol.”

The Digest’s Take

It’s been long contemplated — corn ethanol from Brazil — but there’s the talk phase, and now we’ve entered the walk phase.  As soy demand rises around the world — especially in relation to the shift to more meat consumption — it’s a natural that Brazil would find ways to grow more corn, and expanding into the ethanol market is a natural for companies focused on value-add with diversified product sets instead of rising a single commodity price train.

We’ve long noted that Brazil has the means of success in its hands owing to its positivist approach to innovation and technology — as we discussed in “Attitude before Altitude” here. So, in some ways unsurprising that Brazil has found a new means for growth, and entirely unsurprising that Rastetter’s Summit Ag Group and Fiagril are there in the mix.


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New fuels, vehicles, both, together: The Digest’s 2017 Multi-Slide Guide to the Co-Optima Market Transformation project

Biofuels Digest - Thu, 08/17/2017 - 10:01am

The US Department of Energy initiated a project to identify and mitigate the challenges of moving new fuels and vehicles into markets. Specifically, engaging with all critical stakeholders (OEM’s, fuel producers, distribution networks, gas station owners, UL, regulators, consumers, etc.), to understand and address impacts, concerns, opportunities, and barriers.

The goal is to facilitate new fuel standards needed for introduction into the marketplace, while identifying vehicle, distribution, and infrastructure compatibility of new candidate bio-blendstocks.

Team Lead Doug Longman at Argonne National Laboratory gave this illuminating overview at the 2017 DOE Project Peer Review meetings.

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