An Ethanol Timeline: How We Got Here

Model Ts were "flex-fuel" and some could run on ethanol.

This second blogpost in the series, “Corn-Fed Cars: On the Road with Ethanol,” continues the conversation about ethanol and explores the forces that converged to get us to this critical—and contentious—moment in biofuels history.

Since 1826, when it was first used to power internal combustion engines (ethanol timeline), ethanol has been of interest to entrepreneurs and agriculturists as a possible alternate fuel. As early as 1862, it was heavily taxed to pay for the Civil War. In 1908, Henry Ford produced the flex-fuel Model T, although by then cheap oil took over the powering of the nation and ethanol languished.

Fast-forward to 1974, when Archer Daniels Midland (ADM), the main producer of high fructose corn syrup, found itself in a quandary. The wet milling process used to manufacture corn syrup from corn grain created, in excess, a by-product known as ethanol, and ADM launched a shrewd search to find or create a market for it. (See this paper on the “Ethanol Swindle.”) Capitalizing on the “Project Independence” initiative started by the Nixon administration to reach total independence from foreign energy sources, ADM began a political campaign promoting ethanol as an additive to gasoline—and the current ethanol industry was born. (Read this paper for more on the history.) Read More >

The Genesis of Corn-Fed Cars

Iowa Corn Indy 250

Also contributing to this story is Dennis Keeney, PhD, MS. | Over the next six months, this bimonthly blog series, “Corn-Fed Cars: On the Road with Ethanol,” will initiate a conversation about ethanol and the current environmental and economic impacts of its use.  This first post addresses the progression of ethanol use in the U.S., and the forces that have gotten us to where we are today.

This June at the “Iowa Corn Indy 250,” flags touting “Iowa Corn” and t-shirts promoting “Corn Power” were a common sight at the Newton, Iowa racetrack. The slogans are no surprise, given two facts: first, that the race is sponsored by the Iowa Corn Promotion Board, and second, fellow racing giant NASCAR’s  announcement last year that they will partner with American ethanol producers to fuel its fleet with a gasoline blend containing 15 percent corn ethanol.

At a time when the buzz about corn ethanol seems to have died down on the coasts, its advocates are speaking up, and production in the Midwest continues to ramp up to record levels in light of government subsidies and mandates that spurred the growth of the industry over the last decade. Today, 40 percent of the corn crop in the U.S. goes to ethanol production. Read More >

Again Ethanol and Food are in Conflict

Once again the conflict between the use of corn for ethanol production and the amount of corn available for consumption by swine, beef, dairy and poultry has come into conflict.

Corn prices have increased an astounding 85% in 6 months.

There simply is not enough corn to go around, and thus the price of corn increases. When corn prices rise, prices of other grains also rise. Wheat, rice, even barley rise.And surprise, surprise, the price of  processed food rises.  Why is this?

First, one has to look into the dark world of agricultural economics. Corn, in many ways similar to oil, is a world-wide commodity. Many countries produce corn (for example, China grows more corn than the United States, but has a lot more people to feed). But only a few countries have enough left over to sell on the world markets. Argentina along with the United States are the main exporting countries. And when the corn crop declines in other consuming countries such as China or Mexico, they buy more corn on the open market. And as these countries move “up the food chain” to consume more red meat, pork, dairy and  poultry, they need more corn. So they buy corn from those few countries that have some to spare. But with several countries bidding for corn and a limited supply, the price goes up. It is an “inelastic” situation.  If corn is not available, wheat will do nicely, so will sorghum, etc. So these grains become more valuable. And “wala” food prices rise. Most affected are foods that rely on corn, such as pork, beef, chickens and eggs. But bread soon follows. and this brings food riots. Even the recent uprising in Egypt is being blamed in part on rapidly increasing food prices (I feel this is a stretch,but do not claim to be well-informed in such matters). Even the price of tamales goes up in Mexico. Sure they use white corn, but white corn is also good pig feed so it is bidding against our yellow corn.

Ethanol plays a central role in this fray. Processing a bushel of corn gives about 2.8 gallons of ethanol (less if one converts the energy in ethanol to a gallon of gasoline). The government in its wisdom has mandated that we must use about 12 billion gallons of ethanol by next year. That translates to a lot of corn, about 25% of all the corn grown in the United States. In Iowa, by far the largest ethanol producing state in the nation, about half the corn goes to ethanol. So when supply goes down while demand goes up, the market “bids” for corn. They buy corn from other uses by paying a higher price, and the higher price encourages farmers to plant more corn next year. More grassland and highly erodible land go into cultivation. This increases erosion and water pollution, and turns the countryside even more into a row crop desert.

It seems pretty clear that changing climate is impacting the discussion. This past year, corn production dropped in the United States by about 9%, a huge decline. Bad weather in other parts of the world have cut down on grain production as well. In the meantime, demand for meats and  for foods made from corn continues to increase.

The struggle between the farm state politicians who push for ethanol from corn (and they must or they are summarily dismissed by the farm block supporters such as Farm Bureau and National Corn Growers) and the rest of the country who are being pressured by food wholesale and retail interests, as well as by swine and poultry growers). It is all part of the farm bill, no matter how altruistic the discussion may be.

I have said for years that ethanol policy was really corn policy. Its objective was to assure a demand for corn and a stable high price. Well it worked. Now we have the unintended consequences. At least for the next few months higher prices for many food staples will increase. And to hear some say it, corn based ethanol is to blame. I tend to agree, but as you can see, it is not simple. But then nothing in the convoluted world of farm policy is.

New analysis claims Monsanto skewed GM corn findings, but is hype clouding the real story?

Monsanto conducted studies to evaluate the toxicity of genetically modified (GM) corn on rats as part of European regulatory registry of GM food and feed, prior to commercialization. To our knowledge, only a summary of the findings were made available to the public (for examples see European Food Safety Authority reports NK603, MON863). Greenpeace sued Monsanto to access the original study data, which it then passed along to French investigator Dr. Joël Spiroux de Vendômois, who published a reanalysis of the Monsanto study.

corn

Flickr Creative Commons

Unlike what was concluded in the Monsanto study, Vendomois’ group’s reanalysis found consumption of GM corn to be associated with rat kidney and liver toxicity. The strains of GM corn evaluated in the study (NK 603, MON 810 and MON 863) contained residues of chemicals that allow the plants to tolerate herbicides or insecticides, such as Round-up.

Online sources were quick to cite the GM corn article as evidence of the ills of GM crops. At the time of this writing, social bookmarking sites Reddit and Digg had a combined total of 4,341 tags/votes for a single Huffington Post article about GM corn study.

It is useful that the Huffington Post is raising awareness of GM foods debate; what is concerning is that the media coverage of the study appears to muddle the study conclusions.

Dr. Vendômois and colleagues are quick to say their findings are merely “signs of toxicity rather than proofs of toxicity”; no mention of organ failure in rats is made in the article. This is in contrast with the Huffington Post story that uses organ failure in the title, Monsanto’s GMO Corn Linked To Organ Failure, Study Reveals, and the follow-up story, Monsanto GM Corn Causing Organ Failure In Rats Study: Everything You Need To Know, which further exaggerated study findings to imply a causal link between GM corn consumption and organ failure. Link and causation are distinct concepts and are not interchangeable. Overextending the study’s findings is unwarranted, especially given the study authors’ reservation regarding the quality (and quantity) of the Monsanto data. A similar opinion was expressed from another online source. Read More >

The Ethanol Policy Trap

keeney-header

Mention the biofuel ethanol from corn in anything but glowing terms in Iowa five years ago and one had probably best apply for witness protection. Created by political pressure from the corn and the high  fructose corn syrup industry with the lobbying from ADM and later other corn-related lobby groups, corn ethanol went from a few million gallons, as an afterthought from the wet milling industry, to about 12 billion gallons per year today (the numbers are approximate, plants are opening and closing depending on market conditions). This will require close to 4 billion bushels of corn (each bushel of corn on average supplies about 2.8 gallons of ethanol). In the process ethanol production uses about 36 billion gallons of water just for processing, and requires about 20 million acres of corn land. All this to displace about 8.5 billion gallons of gasoline (ethanol has about 67% of the energy per volume as does gasoline). Further it requires about 7 gallons of diesel fuel equivalent to produce 10 gallons of ethanol when one accounts energy to grow the corn, deliver it to the processing plant, and to process the corn to ethanol. Therefore the net energy gain is about 3-4 billion gallons of gasoline equivalent. We have about 245 million cars in this country. If each car used 20 gallons of gas per year less–by improved efficiency and driving less–we could save nearly 5 billion gallons of gas, more than the ethanol that is being produced by the industry when put in energy equivalents.

Corn is King in the Midwest. Iowa produces over 2.2 billion bushels and sends about one-third of its crop to ethanol plants. That is the base of the ethanol madness–create a market for more corn where no existed before. And it has worked so far, thanks to government support.

Much of the rest of the corn goes to feed livestock and for export. Only about 10% can truly be said to be made into food products, and that includes the unhealthy HFCS. Trailing corn, but still very important is the legume, soybeans. Biodiesel from soybean oil has been on the burner for several years but the economics have never worked out.

The corn ethanol lobby has been hoisted on its own petards. They calculated that if they mandated ethanol use, the market would follow. This worked for the first 7 billion gallons. Since we burn about 130 billion gallons of gasoline a year, the blend of up to 10% ethanol would not be an issue. But in 2007 the mandate was progressively increased and soon will be 15 billion gallons. Simple math says that there will have to be more than 10% ethanol in all of our gasoline to meet the mandate. So the industry asked EPA to raise the “blend wall” to 15% by the end of 2009. EPA is still studying the request. They are concerned with engine component damage and air pollution issues. Time will tell. Another industry answer was a blend of up to 85% ethanol. That has not worked out, because the extra pumps cost more than they return in profits, and few buy E85 both because it performs less satisfactorily and because not many cars and trucks are capable of using E85 without engine component damage. Read More >

Where’s the Grain?

Note: This is a response to an editorial posted in the New York Times.

Thursday’s Editorial (“The World Food Crisis,” New York Times, April 10, 2008) questioned the environmental and ethical impact of corn ethanol production. The question is: With more people and less grain, should we put the food in our gas tanks or in our stomachs?

It’s a good question. Here is another one: With more people and less grain, should we put so much grain into cows?

In the United States 70 percent of the corn harvest is fed to livestock.

Read More >