IFB Ethanol Blog

Wisconsin Ethanol Plants File for Chapter 11

One of Wisconsin nine operating ethanol plants are taking the legal steps of filing for bankruptcy protection. This week, the Renew Energy LLC board of directors voted to file for Chapter 11 under the United States Bankruptcy Code, which will allow them to continue operating their Jefferson facilities under certain rules. In an exclusive interview with Wisconsin Ag Connection on Thursday, Board Chairman Paul Olsen said the company plans to continue producing ethanol fuel and run its state-of-the-art corn dry-milling operation.

Pekin Plant Announces More Layoffs

MGP Ingredients Inc. said last week it temporarily laid off 14 production workers at its Pekin plant, a move the company warned of two months ago.

The layoffs resulted from MGP's decision to curtail production of fuel grade alcohol, or ethanol, at the Pekin distillery until market conditions improve, said Steve Pickman, vice president of corporate relations for the Atchison, Kan.-based company.

It's the second job reduction at the Pekin plant since early November. The first one, however, resulted in the permanent loss of 40 jobs - about one-third of the 130 employees there at the time - when the company chose to discontinue production of wheat proteins and starches at that facility.

(Source: Peoria Journal-Star)

Hereford, TX Plant Files Chapter 11

Panda Ethanol Inc. last week announced that its Hereford Biofuels subsidiary has filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Northern District of Texas. The company intends to sell its major asset, the Hereford ethanol refinery, pursuant to a Section 363 sale process approved by the bankruptcy court. The bankruptcy filing does not include Panda Ethanol, the parent company of the Hereford subsidiary, and was precipitated by the refusal of one of the project's leading banks to fund its loans, which the company believes is a breach of the bank's financial commitment.

The Hereford subsidiary is currently in negotiations with a potential buyer. The company expects for a sale to close within 60 to 90 days.

Some Illinois grain elevators are among the creditors listed in the bankruptcy filing.

Study Looks at Ethanol Impact on Local Iowa Corn Market

The first half of the decade brought a substantial shift in where corn was delivered and how it was used in the Cornbelt with the rapid development of ethanol plants. Elevators lost a substantial market share of corn handling to the ethanol plants, but the growing volume of corn offset the loss. Elevators also benefited from the merchandising of wet and dry distillers’ grains to livestock operations, which remain the largest end user of corn and ethanol co-products. The dynamics in the market will continue to shift, impacting the basis, transportation, and product availability.  Read the Iowa State University study below:

Download Impact of Ethanol Industry Expansion on Corn Utilization and Distribution-Final

Verasun: Several Plants in "Hot Idle"

U.S. ethanol maker VeraSun Energy Corp VSUNQ.PK, which filed for bankruptcy protection in October, said on Tuesday that 12 of its 16 ethanol plants are in "hot idle," or ready to operate, but not currently making the alternative motor fuel.

Two of the 12 plants that are in hot idle were awaiting their initial operation, said spokesman Mike Lockrem.

(Source: Reuters)

E-85 Still Growing

Although the big rush for permits to build ethanol plants in Illinois has slowed to a trickle, the number of flexible-fuel vehicles on the road that can use E85 is increasing.

And despite the fact that cheaper gasoline prices may somewhat have dampened enthusiasm for the generally less expensive E85, the number of facilities offering the ethanol-gasoline blend has grown since last year.

“The Illinois Environmental Protection Agency alternate fuels rebate program remains active,” said agency spokesman Maggie Carson. “There are a large number of E85-compliant vehicles, and people are continuing to use them and apply for rebates.”

Source: State Journal-Register

Biofuels Positioned to Grow

Biofuels—ethanol and biodiesel—increase the U.S. energy independence, are good for the environment and for rural America, according to Brooke Coleman, executive director of the New Fuels Alliance and spokesman for www.FoodPriceTruth.org, a Web site created to combat criticism that using grain to make fuel increases the cost of food.

Coleman spoke at a conference during the American Farm Bureau Federation annual meeting titled “The Growing Role of Biofuels for Today, Tomorrow and Beyond.”

“Agriculture is the key to the new energy economy,” Coleman said. “Biofuels are the key to agricultural revitalization.”

The biofuels industry has survived a well-orchestrated smear campaign led by food makers and environmental groups. Now, the economy has taken a serious downturn. But renewable energy is poised for continued growth, according to Coleman.

He said many ethanol and biodiesel companies have cash reserves to transition through the current tough times, the cost of breaking down their feedstocks is coming down and several new biofuel plants making advanced ethanol from non-grain feedstocks are coming online. 

New Energy Chief Looking Ahead

Steven Chu, the Nobel laureate selected to be the next energy secretary, says he’s optimistic that the country can commercialize new forms of biofuels that won’t come from food crops.

The next generation of biofuels won’t necessarily be ethanol, Chu said at his confirmation hearing today before the Senate Energy and Natural Resources Committee.

He said scientists at the Lawrence Berkeley National Laboratory where he’s been director are developing the bacteria and yeast needed to convert plant cellulose into new versions of conventional gasoline and diesel.

(Source: Des Moines Register)

Brazil Expansion Plans

While Brazil is currently second behind the US in world ethanol production, its plans for expansion are in nearly lockstep with the US renewable fuels policies. Brazilian ethanol comes from sugar, which produces more ethanol per acre than corn, and is produced at a lower price per gallon. While the US maintains a tariff on imported ethanol, some Brazilian ethanol does enter the US market at competitive prices. Over time, Brazil will have the opportunity to produce even more ethanol at a lower price than the US, which will challenge current US renewable fuels policies.

Source: FarmGate blog

USDA Reports Bearish for Corn

    CHICAGO, Jan 12 (Reuters) - The stockpile of corn in the
United States keeps growing as its use for ethanol wanes,
exports dwindle and as chicken, cattle and hog feeders
retrench, a CME Group panel said on Monday.
    "Because of the destruction of the ethanol sector and
competition with feed wheat, we're building corn stocks," said
Joe Victor, analyst for research at advisory firm Allendale
Inc.
    The U.S. Department of Agriculture (USDA) on Monday in its
January crop and stocks reports said the ending supply of corn
in the United States for the current 2008/09 marketing year
would total 1.750 billion bushels, sharply above the forecast
in December for 1.474 billion and well above an average of
analysts' estimates for 1.499 billion.