E15 on the way?

[KY_Canyon]

Originally Posted by shovel

Two acres of corn produce ~150-160 bushels of corn worth of food value in the form of DDS/DDG, in addition to the ~860gal of ethanol also produced. This is compared to ~150-160 bushels of corn per acre at straight crop-food value.

So, using the data you posted it's easy to see that it takes twice the corn to produce 860 gallons of ethanol while still producing the 150-160 bushels of corn worth food value. Which translates to a need of 1 acre of corn for every 860 gallons of ethanol. In 2010, the ethanol production was 13 billion gallons which comes to 15 million acres of corn. That's a 15 million acre reduction of feed corn supply. So based on 2010 prices, that's $11,295,000,000 worth of corn for ethanol production (just the portion that's not replaced with DDS/DGS). It does effect the cost of feed corn as well as corn exports, etc. "There is no such thing as a free lunch"

Price per Bushel of Corn:

Year $/Bshl
2000 1.85
2001 1.97
2002 2.32
2003 2.42
2004 2.06
2005 2.00
2006 3.04
2007 4.20
2008 4.06
2009 3.55
2010 5.30

As far as the other corn market demands (weather, feed, etc) that you say contribute to the increase in corn prices; those demands are the reason that the corn market exists. That's where my problem lie's, why take a product that already has high demand and use it in an attempt to solve a demand problem in completely different market. Thus giving motivation to speculators. It's basic economics. This ethanol craze is not being done in for the best interest of the public; it's being done for special interests, and some are so blinded by their cause that they can't see the forest for the trees.

I'm all for alternative fuel research & production as long as it's done with sound economic principals and in the best interest of the public. I'm also all for reducing emissions and conserving this wonderful planet. However, I'm not a blind sheep and don't often jump on buses; and I most definitely don't take the attitude that so many seem to have....save the planet and to hell with the people on it.

If ethanol is so great, stick it in a tank and allow those who have the proper equipment voluntarily choose to run it. Don't mandate that everyone use it regardless of whether their equipment is designed for it or not.....might as well make us all replace one quart of engine oil with corn oil.

[Allch Chcar]

The 5.9% minimum Ethanol is for the EPA's emissions reduction program. It also reduces Oil consumption so it's a bit of a win win. Needless to say when the original oxygenate mandate was introduced in 90...4? MTBE(a petroleum product) was legal and it was being pushed as the oxygenate until environmental data showed it was leaking into the environment and subsequently banned.

The issue is whether we should allow E15 to be sold like E85 so that people can choose to use it. No one is suggesting we mandate E15 usage. The mandated Ethanol usage is for oxygenate requirements by the EPA. MY 2001+ have been approved for E15 use by the EPA and they're finalizing laws and regulations for it's sale.

What should be mandated or encouraged is FFVs from the manufacturer that can run on Gasoline or Ethanol or a mixture of the two. Right now it's mostly fleet sales and light duty trucks that are FFVs and that means a large portion of new vehicles cannot run E85, (without an aftermarket conversion of some sort).

BTW. Considering the Renewable fuels standard was adopted in 2001, there is no direct correlation between the mandate of Ethanol and your chart. You need a chart of domestic Ethanol consumption to even consider doing that. Another factor you ignored is the cost of Diesel. Please compare all three next time.

[KY_Canyon]

Originally Posted by Allch Chcar

The issue is whether we should allow E15 to be sold like E85 so that people can choose to use it. No one is suggesting we mandate E15 usage.

The mandated use of ethanol is through elimination of alternatives.

What should be mandated or encouraged is FFVs from the manufacturer that can run on Gasoline or Ethanol or a mixture of the two. Right now it's mostly fleet sales and light duty trucks that are FFVs and that means a large portion of new vehicles cannot run E85, (without an aftermarket conversion of some sort).

I wouldn't argue that a percentage of vehicles be required to be FFV. I purchased FFV with the intent of making use of it. However, there is no supply of E85 in my area....none. IMO E15 is a direct result of the poor sales of E85.

BTW. Considering the Renewable fuels standard was adopted in 2001, there is no direct correlation between the mandate of Ethanol and your chart. You need a chart of domestic Ethanol consumption to even consider doing that. Another factor you ignored is the cost of Diesel. Please compare all three next time.

My chart was not an attempt to reflect the change in the price of corn based directly on its mandated use. It was merely a chart to reflect the change in the cost of a bushel of corn since 2000. In fact, the whole point is that there are far more considerations than the direct cost of corn use in ethanol.

"There's no such thing as a free lunch"

Corn, being a commodity, is effected by many more factors than mere supply & demand....some speculative and some uncontrollable. The supply has not changed substantially in the past decade...some years up & some years down. As a result, demand and speculation cause the price to increase. The increased price is passed along to all corn based products. That, IMO, is the reason that corn is such a horrible choice as an alternative fuel for everyone except those directly benefiting from the corn market.

I'm all for alternative & renewable fuels and would gladly pay more for them if it lessons our dependence on those who would do us harm given the opportunity. However, I honestly feel that ethanol was never intended as that solution.....ethanol is all about special interests taking advantage of the opportunity.....which is in essence speculation in its purest form. I fear that the more time and effort that we spend on the corn solution, the further it takes us from a real viable portable energy solution.

[shovel]

Originally Posted by KY_Canyon

. So based on 2010 prices, that's $11,295,000,000 worth of corn for ethanol production
.

Originally Posted by shovel

According to the Department of Energy and the Department of Agriculture, in this memo: http://www.ethanol.org/pdf/contentmg...tter_61208.pdf
.......................

"We estimate that, if we had not been blending ethanol into gasoline, gasoline prices would be between 20 cents per gallon to 35 cents per gallon higher." .

According to the EIA we use about 137,760,000,000 gallons of gasline per year. How much gasoline does the United States consume? - FAQ - U.S. Energy Information Administration (EIA)

So if we saved 25 cents per gallon on that, it means we saved about 34 billion dollars on fuel by spending 11 billion dollars on corn. Sounds pretty cool to me.

[Allch Chcar]

Unlike Hydrogen, Natural Gas, and Electric. E85 is not even considered an alternative fuel source by the tax code and doesn't receive the same subsidies that those sources receive. So who is eliminating who? If anything the "special interest" for Corn Ethanol is delivering while the rest of the alternatives aren't nearly as popular nor successful. If you think that's competition you're darn right, the Petroleum industry is already extremely competitive with itself without alternatives undercutting it!

The price of Diesel also went up in 2007 when it was switched over to low sulfer. The economy shrunk in 2008. And the price of Gasoline is around $4. The rapid inflation kicking in. I can assure you that that the price corn is a small factor compared to everything else. For beef, Corn can only be used to supplement their diet unlike poultry so there's that to consider. Hay is largely the primary food source for cattle.

Plus we have had record Corn crops for the last couple of years so your argument that supply of Corn is staying the same is just not true. Reuters Record Corn crop est for 2012. The chart clearly shows Corn crops increasing from 2009-2011. The 2012 is an estimate FYI.

There are no "fuel efficient" or compact FFVs. The 2012 Focus was supposed to be FFV but that was a disappointment. The smallest FFV is the Chevy HHR and the Chevy Malibu, midsize cars that are very common fleet cars. The CAFE FFV credits are a joke, they encourage the manufacturers to only build FFVs for fleet cars, trucks, and SUVs.

[KY_Canyon]

Originally Posted by shovel

According to the EIA we use about 137,760,000,000 gallons of gasline per year. How much gasoline does the United States consume? - FAQ - U.S. Energy Information Administration (EIA)

So if we saved 25 cents per gallon on that, it means we saved about 34 billion dollars on fuel by spending 11 billion dollars on corn. Sounds pretty cool to me.

Again, that is the direct costs. It does not take into account all of the indirect costs of corn based ethanol use:

1)Decreased efficiency--there is not a 1:1 energy comparison of ethanol to gasoline, and given that petroleum based fuel is used in the production of ethanol than there isn't even a 1:1 replacement factor.

2)inflated costs of corn based products--beyond livestock feed, there a way too many products to name (plastics, linens, etc, etc, etc.)

3)Reduced corn exports--Corn could easily be one of our most viable exports.

4) on, and on, and on.


I'm just saying there has to be a better alternative than corn (grass, seaweed, something)

[shovel]

Yes, all corn based products inflate each's other' price. I'm not entirely sure I understand what part of that makes fuel ethanol not OK while floor wax and product packaging and kitty litter are OK.

Of those things, if corn based floor wax makes your grocer's building maintenance costs lower vs. another impossible-to-eat alternative source, then the also-corn-based products in that store will cost slightly less.

Likewise if the cost of fuel for the farmer, for the grocer, for the butcher, for the employees of those folks, etc is cheaper, then the prices of everything they sell can also be cheaper.. meanwhile all of the consumers can take the >5% less they're spending on fuel and buy more stuff while they're at it.

So as illustrated above, we spent an estimated 11 billion on fuel corn to save an estimated 34 billion in fuel costs. If you're going to talk about the "inflated cost of corn products" then you need to see the other side of that, the deflated cost of literally every product that relies in any way on internal combustion engines. Including corn itself, which is harvested by internal combustion powered machines and delivered to market similarly. Using figures previously noted in this thread, if the food price index rose ~4% and 5% of that increase could be blamed on fuel ethanol's impact on the price of corn, then 5% of 4% is 0.2%. You're seeing about a 0.2% increase in food price index based on corn ethanol.

Likewise if gasoline is $3.80/gallon but *would* be $4.00-$4.15/gallon without ethanol's presence in the fuel market, that's more like a 5+% decrease in fuel price.

Going with simple, front-end dollar amounts, according to Bundle.com we spent around $2200 per household on gasoline in 2009 and we spent around $6500 per household on food.

5% of $2200 is $110 and 0.2% of $6500 is $13.

Based on this quick estimate, we save about a hundred net bucks per year per household because of corn derived fuel ethanol at face value.

[Frank Lee]

I think a more in-depth look at historical corn prices would be in order too, if we're gonna go down that road. It was so cheap for so long I don't know how it could have been profitable to grow at all.

[KY_Canyon]

Originally Posted by shovel

Yes, all corn based products inflate each's other' price. I'm not entirely sure I understand what part of that makes fuel ethanol not OK while floor wax and product packaging and kitty litter are OK.

Of those things, if corn based floor wax makes your grocer's building maintenance costs lower vs. another impossible-to-eat alternative source, then the also-corn-based products in that store will cost slightly less.

Likewise if the cost of fuel for the farmer, for the grocer, for the butcher, for the employees of those folks, etc is cheaper, then the prices of everything they sell can also be cheaper.. meanwhile all of the consumers can take the >5% less they're spending on fuel and buy more stuff while they're at it.

So as illustrated above, we spent an estimated 11 billion on fuel corn to save an estimated 34 billion in fuel costs. If you're going to talk about the "inflated cost of corn products" then you need to see the other side of that, the deflated cost of literally every product that relies in any way on internal combustion engines. Including corn itself, which is harvested by internal combustion powered machines and delivered to market similarly. Using figures previously noted in this thread, if the food price index rose ~4% and 5% of that increase could be blamed on fuel ethanol's impact on the price of corn, then 5% of 4% is 0.2%. You're seeing about a 0.2% increase in food price index based on corn ethanol.

Likewise if gasoline is $3.80/gallon but *would* be $4.00-$4.15/gallon without ethanol's presence in the fuel market, that's more like a 5+% decrease in fuel price.

Going with simple, front-end dollar amounts, according to Bundle.com we spent around $2200 per household on gasoline in 2009 and we spent around $6500 per household on food.

5% of $2200 is $110 and 0.2% of $6500 is $13.

Based on this quick estimate, we save about a hundred net bucks per year per household because of corn derived fuel ethanol at face value.

Very reasonable response.


For me, the difference between ethanol and floor wax / kitty litter, etc. is that the wax and kitty litter will either survive or fail based on good old fashioned economics. Consumers can either choose to purchase those products or not. We don't have that opportunity with ethanol and because it's use is mandated by one means of another. To make matters worse is the fact that the kitty litter and floor wax may be 5% more expensive due to ethanol. LOL

So if we have saved 5% in the per gallon cost but decreased fuel efficiency by even 3% (I think more), then we are netting a 2% savings or $44 (2% of $2200) per year.

The pure truth to the matter is that we could sit and debate and evaluate where we save and where we pay more due to ethanol / corn. The fact of the matter is that if it is truly worthwhile then the market will accept it.....perhaps slowly at first, but it will be accepted. That has not happened so it is slowly being mandated and I fear that the true COST of ethanol will be that it could very well be the biggest factor that keeps us from finding a more realistic long-term renewable fuel source.

There have been some great discoveries in its development that will prove useful, but ethanol is not the answer.

[roosterk0031]

Exporting corn only to import crude oil just makes no sense to me.

Exporting raw materials vs finished products makes no sense to me, let's have the jobs & companys converting field corn to useable product here, does China, Japan or Tiawan export raw materials here, lets make they buy our finished products.

US companies are exporting fuel, I read that it was the biggest $$ export the US had last year, that's great, taking a raw material and converting it to a finished product is where a large part of the profit is.

Last I read there is like 7 cents worth of corn in a box of cornflakes, even if corn doubles, we won't notice it at the stores. The money's & jobs are in turning the raw material into finished goods.

I'm not for any mandates, Iowa offers E0 or E10 at every station, and E85 isn't hard to find, with my FFV cars I used the cheapest/mile.

It must be up to states to mandate it, if you don't like it you need to take it up with your state. I like it, I think it makes sense, Brazil's been using it for 25-30 years, every blend I've run thru Stratus the cost per miles is pratically the same, I think ethanol should be cheaper, it follows petro to close, we need more competition (Brazil) to keep the local manufactures honest.