KSMQ “Farm Connections” Episode – Green Star Farms Initiative

The Green Star Farms Initiative is a voluntary, farmer-led educational program designed to raise awareness among farmers about water quality issues; recognize the conservation practices that are already being employed by many farmers and ranchers that contribute to improved water quality, reduced soil erosion, enhanced soil health and increased wildlife habitat; and accelerate the adoption of sound conservation practices to improve water quality.

KSMQ, the PBS member station located in Austin, MN, highlighted the Green Star Farm Initiative during a broadcast of “Farm Connections”.  The Green Star Farms episode can be accessed by visiting https://www.youtube.com/watch?v=jw2rv17a3L0#t=114

Additional information regarding the Green Star Farms Initiative can be accessed by visiting https://greenstarfarms.org/

(Disclosure: The Minnesota Agricultural Water Resource Center is a client of RDL & Associates)

Branstad: EPA chief misled ethanol producers, farmers (via Des Moines Register)

As the White House moves closer to a decision on how much ethanolshould be included in the gasoline supply, Iowa Gov. Terry Branstad charged the head of the agency overseeing the mandate with being misleading in her support for renewable fuels.

In an interview, Branstad said Gina McCarthy, head of the Environmental Protection Agency, promised during an appearance at the Iowa State Fair in August of 2013 that she was supportive of renewable fuels and was focused on repairing strained relations between the farming community and the regulatory agency. It was one of her first speaking engagements after taking the job a month earlier.

Instead, the EPA proposed a few months later cutting how much ethanol must be blended into the country’s gasoline supply as part of the Renewable Fuel Standard in 2014, and has since delayed announcing a final decision. As a result, ethanol and other agricultural supporters believe she has failed to follow through on her pledge, Branstad said. The seven-year-old Renewable Fuel Standard requires refiners to buy alternative fuels made from corn, soybeans and other products to reduce the country’s dependence on foreign energy.

“Gina McCarthy misled us when she said she was supportive of renewable fuels and we had every reason to believe that we’re going to get a fair shake out of the EPA. We feel that we’ve haven’t,” Branstad said. “I don’t think they realize the significant damage they’re doing to the Midwestern agriculture economy.”

Iowa is the nation’s leader in renewable fuels production. It has 42 ethanol refineries capable of producing more than 3.8 billion gallons annually and 12 biodiesel facilities with the capacity to produce nearly 315 million gallons annually.

EPA spokeswoman Liz Purchia said the agency disagreed with Branstad’s comment. She said the United States is using more biofuels than ever and Iowa has played a major role in that growth.

“The agency’s overarching goal is to put the (Renewable Fuel Standard) program on a path that supports continued growth in renewable fuels over time,” Purchia said. “But it’s important to remember that RFS is one piece in an overall comprehensive strategy to move this industry forward.”

The EPA first proposed last November sharply cutting ethanol produced from corn to 13 billion gallons compared to 14.4 billion gallons set by Congress for this year. The agency said the marketplace could not absorb the amount of ethanol that had been mandated in the 2007 law. While White House officials, including Agriculture Secretary Tom Vilsack, have said the EPA will likely restore at least some of the proposed cuts to the mandate when it’s finalized later this fall, ethanol supporters say the damage already has been done.

Branstad and other backers of the renewable fuel say the proposed reduction and delay in announcing a final rule have contributed to the drop in corn prices that now are hovering around $3.30 a bushel — below the cost of production for some farmers. In 2012, corn prices were above $8 a bushel as much of the Corn Belt sweltered under its worst drought in decades.

Last week, Branstad and Lt. Gov. Kim Reynolds spoke with Shaun Donovan, director of the Office of Management and Budget, the agency tasked with vetting proposed regulations such as the annual ethanol blending requirement. During the 10-minute phone call they emphasized to him the damage to the state’s economy. In Iowa, Branstad estimated the financial damage has been “billions of dollars.”

The EPA’s failure to fully back the mandate, critics say, has thwarted investment in ethanol made from corn and plant waste; discouraged farmers from buying new equipment; and resulted in jobs not being created in rural economies. The delay also has made it difficult for ethanol producers and companies that blend the renewable fuel into gasoline to plan for a rule that is several months late being put in place.

“Those are pretty strong words (from Governor Branstad),” said Chad Hart, an Iowa State University associate professor of economics. “Here you see the governor’s frustration that it has taken this long, that(it) is basically a year behind. I think it does require some stronger language. You would like to see things move quicker than this.”

Commentary – One more time: Farmers grow enough corn for food and fuel

One of the most frustrating criticisms corn farmers face is the contention that we should be growing corn strictly for food, not ethanol fuel.

Our critics frame the debate as food vs. fuel, and completely disregard the facts when unfairly blaming ethanol for taking food off people’s plates and raising food prices.

Yes, food prices have increased, about $1 per family member for a family of four compared to the average consumer price index since 2005. But as a World Bank study showed, those increases are because of the cost of oil, not using corn to make ethanol.

In reality, the presence of ethanol in our gasoline is saving that same family of four about $863 annually at the pump according to the Center for Agricultural and Rural Development.

Given these facts, it makes me wonder why the food vs. fuel debate still has any credibility.

Classifying food vs. fuel as a debate gives it more credit than it deserves. It’s actually a myth manufactured by the oil industry and trumpeted by anti-ethanol zealots, some of whom want to return to the days of $1.50 corn out of pure selfishness.

Corn farmers are projected to harvest a record crop totaling more than 14 billion bushels this fall. That’s more than enough corn to provide food, feed, fiber and fuel, with some left over.

Despite what the food vs. fuel naysayers will tell you, we’ve been growing enough corn to feed people and fuel our vehicles for a while now. And we’re not taking food off someone’s plate to do it.

For every bushel of corn used to make ethanol, we get 2.8 gallons of fuel and 18 pounds of dried distillers grains, a high-protein livestock feed.

Today, corn is marketing for less than $4 per bushel, the lowest it’s been since the Renewable Fuel Standard – legislation that sets targets for the amount of ethanol blended in our gasoline – was passed in its current form in 2007.

Most Minnesota corn farmers are just hoping to break even this year. Have you noticed food prices decreasing? I haven’t either.

There are many factors beyond corn prices that influence what you pay for food (and ethanol isn’t one of them). A new report released last week from the Renewable Fuels Association found that even though corn prices have plunged 50 percent since their peak in 2008, food prices have stayed the same or gone up.

Farmers only get about 16 cents for every $1 consumers spend on food. Like any good business, corn farmers looked for new uses and ways to add value to their product. We understood that livestock feed was and always will be our most important market, but we also knew there were other value-added opportunities for corn. It was important that we capitalized on them.

Because consumers were looking for homegrown, less expensive and cleaner burning options at the pump, we seized the ethanol opportunity. That foresight has helped corn farmers better withstand downturns in corn prices like what we’re experiencing this year.

My term as president of the Minnesota Corn Growers Association ends in less than a month. If there’s a lasting message I hope to leave people, it’s this: Don’t underestimate Minnesota’s corn farmers.

Despite what the doubters say, we grow more than enough corn for food and fuel. Often, we persevere through challenging weather conditions and other obstacles to do it.

The result is food for a growing world population, a homegrown, cleaner-burning fuel for our vehicles, and savings at the pump for consumers.

Ryan Buck is a corn and soybean farmer in Goodhue and president of the Minnesota Corn Growers Association.

RDL & Associates Radio Interview: Waters of the U.S., RFS and Railcar Shortage

Dave Ladd, President of RDL & Associates was recently a guest of KTLF Farm Director Scott Colombe to discuss the proposal by the Environmental Protection Agency (EPA) and the Army Corps of Engineers regarding regulation of “Waters of the United States”, the Renewable Fuels Standard (RFS), the ongoing railcar shortage and prospects for a lame duck session of Congress.

The interview can be accessed here: https://www.dropbox.com/s/rh5qlgph1lm4omi/KTLK%20Radio%20-%20WOTUS%20and%20Railcar%20Shortage%20%28September%202014%29.mp3?dl=0

Issue Update: Attention to Railcar Shortage Continues to Increase

Concerns that the 2013 crop will not be moved prior to the Fall harvest due to a lack of locomotives and railcars continue to be at the heart of a dilemma faced by farmers, local elevators and agricultural cooperatives.

When coupled with low commodity prices due to bumper crops, the added costs due to the railcar, as well as fines imposed on some farmer-owned cooperatives for not making grain deliveries on time, are further eroding profits. According to the University of Minnesota, losses to Minnesota farm income from March 2014 to May 2014 were approximately $100 million.  A study by North Dakota State University estimated similar lost farm income for North Dakota farmers.

At its core, the issue is an infrastructure issue. The shortage of pipelines has forced oil from North Dakota’s oil fields onto the rails, resulting in distribution bottlenecks.  During a recent field hearing held by the Surface Transportation Board, farmers and policymakers expressed concerns that increased crude oil and freight shipments from North Dakota’s western oil fields are largely the cause of shipping delays throughout the region.

A bill authored by Senator John Rockefeller (D-WV), Chairman of the Senate Committee on Commerce, Science, and Transportation Chairman and Senator John Thune (R–SD), the committee’s ranking Republican would provide the NTSB with enhanced authority.

The Surface Transportation Board Reauthorization Act of 2014 (S. 2777) would increase the board’s authority to conduct its own investigations (instead of waiting for a complaint), improve rate review timelines and increase the number of members from three to five.

In addition to the introduction of the above-referenced legislation, the Senate Committee on Commerce has also held a hearing regarding the locomotive and railcar shortage.

Lance Peterson, a soybean farmer from Underwood, MN and current American Soybean Association (ASA) Director, provided testimony during the STB field hearing on behalf of the ASA and the Minnesota Soybean Growers Association (MSGA). Mr. Peterson noted that “farmers are suffering losses in the hundreds of millions of dollars through increased basis levels, lower cash market prices, and storage losses because of the current rail situation.”

He requested that the Surface Transportation Board require the railroads to submit metrics showing past dues, average days late, turnaround times, etc. for agricultural shippers, the oil industry, and other customers in order to garner a clear picture of railroad service issues.  “Based on the size and scope of the rail shipment problems being faced in the upper Midwest, this is not too much to ask” said Peterson.

Mr. Bob Dinneen, President & CEO of the Renewable Fuels Association (RFA), noted in his testimony that “The recent crisis of congestion that has seemingly overtaken the rail industry has become a huge and costly problem for shippers of all commodities, including the U.S. ethanol industry”.

On behalf of the RFA, Mr. Dinneen called for “greater transparency…to help regulators oversee and monitor how logistics and contracting decisions are being made by rail operators.”

Railroads, primarily the Burlington Northern Santa Fe (BNSF) and Canadian Pacific (CP) have denied they favor one sector over another.

Stevan Bobb, executive vice president and chief marketing officer for BNSF Railway, warned against policies allowing other railroad companies or private cars to use BNSF tracks, or to prefer some regions or commodities over others. Instead, he suggested the board assess the total volumes the railroads are handling and hold the companies accountable for their capacity to increase the volume.

Mr. Bobb noted that, as of August 31st, the BNSF Railway has added 339 locomotives out of a goal of 500 for the year, as well as hiring 2,419 employees of the planned 3,000 in its train, yard and engine service – and another 2,305 engineering and mechanical staff, thereby exceeding its goal of 2,000 for the year.

John Brooks, vice president for bulk market products for CP, noted that CP handles only 20 to 23 percent of the region’s agricultural shipping but has moved 5 percent more than the three-year average. He stated that “allegations and implications” that CP has been strong-arming or bullying elevators to cancel orders are not fact-based and that CP will invest $400 million between Canada and St. Paul, Minn., – as well as attempting to hire 400 new employees.

A copy of Mr. Peterson’s testimony can be accessed by clicking on the following link:

https://www.dropbox.com/s/2bh6yexn7hwmtuo/Peterson-Testimony1.pdf?dl=0

A copy of Mr. Dinneen’s testimony can be accessed by clicking on the following link:

https://www.dropbox.com/s/n3jbzsmrgc817li/Bob%20Dinneen%20Testimony%20to%20Senate%20Committee%20on%20Rail%20Service.pdf?dl=0

A .pdf of this “Issue Update” can be accessed by clicking on the following linke:

https://www.dropbox.com/s/79jh83w5nqnyk6r/Issue%20Update%20%28September%202014%29.doc?dl=0

Additional Information

Please send questions, comments and suggestions to:

Dave Ladd, President

RDL & Associates, LLC

e-mail:            daveladd66@gmail.com

LinkedIn:        http://www.linkedin.com/pub/dave-ladd/0/b87/11

Blog:              https://rdlassociates.wordpress.com/

Twitter:          DaveLadd37

Copyright © 2014 RDL & Associates, LLC. All rights reserved.

Client Spotlight: Al-Corn Clean Fuel

Overview: Al-Corn Clean Fuel

Founded in 1994, Al-Corn Clean Fuel is a farmer-owned ethanol production cooperative located in Claremont, MN. The cooperative was created when depressed corn prices drove local farmers to seek new opportunities to add value to their corn crop.

For two decades Al-Corn Clean Fuel has created a guaranteed and stable market for corn, maintained a strong cash position during an uncertain economy and made investments that added significant value for members and their local communities.

The initial investment by Al-Corn members was for facility planning and construction. Today, members purchase shares so that they can deliver corn and participate in adding value to their corn crop via processing.  These members agree to deliver a quantity of corn to the plant, which is determined by their investment. The “corn commitment” has been a key contributor to the success of Al-Corn Clean Fuel.

The Al-Corn Clean Fuel plant utilizes a dry milling process, the most commonly used method in the ethanol industry. The whole corn kernel is ground into a powder, mixed with recovered process liquids to form a mash (similar to oatmeal) and then cooked with enzymes that turn the starch into glucose. Yeast is added and the mash is fermented and CO2 is collected.  The resultant “beer” is distilled to separate the ethanol from the solids and remaining liquids.  These are further processed to recover liquids for the mashing process, and to produce high protein livestock feed and distillers corn oil.

Annually Al-Corn Clean Fuel grinds 17.5 million bushels of corn and produces 50 million gallons of ethanol. The plant produces 132,000 tons of high protein livestock feed, 12 million pounds of corn oil and 70,000 tons of beverage grade carbon dioxide The majority of these products are consumed by refiners, livestock feeders, meat packers and biodiesel producers right here in Minnesota.

Al-Corn Clean Fuel continues to utilize the best available control technologies in order to reduce energy consumption and production costs while at the same time increasing efficiencies and reducing emissions.

The Al-Corn plant has reduced water consumption to less than 2.4 gallons of water per gallon of ethanol and was the first plant to achieve “zero liquid discharge”. In addition, energy conservation efforts have reduced the plant’s energy use by more than 35% compared to the original plant design.

For additional information regarding Al-Corn Clean Fuel, please contact Randall Doyal at RDoyal@al-corn.com  or visit al-corn.com.

Link: https://www.dropbox.com/s/1bls50uj47sdsa9/Overview%20%28Al-Corn%20Clean%20Fuel%29.docx?dl=0

U.S. House passes legislation prohibiting implementation of proposed “Water of the United States” rule

The United States House of Representatives has passed the Waters of the United States Regulatory Overreach Protection Act of 2014 (H.R. 5078), legislation authored by Representative Steve Southerland (R – FL) that would prohibit the Environmental Protection Agency (EPA) and the U.S. Army Corps of Engineers from finalizing the proposed rule or guidance document related to the definition of waters of the United States under the Clean Water Act (CWA).

The Congressional Research Service (CRS) summary of the legislation is as follows:

Waters of the United States Regulatory Overreach Protection Act of 2014 – Prohibits the U.S. Army Corps of Engineers and the Environmental Protection Agency (EPA) from:

  • developing, finalizing, adopting, implementing, applying, administering, or enforcing the proposed rule entitled, “Definition of ‘Waters of the United States’ Under the Clean Water Act,” issued on April 21, 2014, or the proposed guidance entitled, “Guidance on Identifying Waters Protected By the Clean Water Act,” dated February 17, 2012; or
  • using the proposed rule or proposed guidance, any successor document, or any substantially similar proposed rule or guidance as the basis for any rulemaking or decision regarding the scope or enforcement of the Federal Water Pollution Control Act (commonly known as the Clean Water Act).

Requires the Army Corps and the EPA to withdraw the interpretive rule entitled, “Notice of Availability Regarding the Exemption from Permitting Under Section 404(f)(1)(A) of the Clean Water Act to Certain Agricultural Conservation Practices,” issued on April 21, 2014.

Requires the Army Corps and the EPA to consult with relevant state and local officials to develop recommendations for a regulatory proposal that would identify the scope of waters covered under the Clean Water Act and the scope of waters not covered.

To see how a particular member of the House of Representatives voted, access the roll call at http://clerk.house.gov/evs/2014/roll489.xml

Companion legislation entitled the Protecting Water and Property Rights Act of 2014 (S. 2496) is awaiting action in the United States Senate  but has yet to receive a hearing.

For additional information regarding this issue, please contact Dave Ladd with RDL & Associates at daveladd66@gmail.com

 

Corn Farmers Concerned About RFS and Low Prices (via DomesticFuel.com)

Corn farmers are concerned about the impact lower volume requirements under the Renewable Fuel Standard (RFS) could have on growers ready to harvest a record corn crop this year.

“We’re keeping a close eye on corn prices and are greatly concerned about efforts in Washington that may reduce or stifle demand for corn and raise the cost of production,” said National Corn Growers Association First Vice President Chip Bowling during the Farm Progress Show in Boone, Iowa this week. “As thrilled as we are with a record crop, we know it has its challenges.”

Bowling says it will be detrimental if the EPA moves forward with its proposal to lower volume requirements for corn ethanol to be blended into the nation’s fuel supply. “Reducing the demand of corn for ethanol will significantly impact corn prices – at a time when prices are already too low,” said the corn farmer from Maryland. “We need stability and we need EPA to stick to the statutory amount of corn ethanol in the RFS.” Chip Bowling, NCGA comments on record corn crop