SD Corn

How do you put a real value on something? What kind of effect must something have before it’s truly valued or appreciated?

Distiller grains, the byproduct of corn ethanol is benefitting ethanol plants, ranchers and the United States trade deficit, but still some state and federal governments don’t seem to understand it true value.

When corn arrives to an ethanol plant, 100% of the product is utilized with about 2/3’s being made into ethanol fuel with about 1/3 being made into distiller grains, a high protein, livestock feed source used as a partial replacement for corn. Distiller grain sales help improve ethanol plant margins while ranchers can purchase the byproduct for less than $1/bushel, creating an inexpensive yet healthy ration for their livestock.

As far as trade goes, in 2009 the United States exported 5.64 metric tons of distiller grains worth about $1 billion dollars. The 2009 total was 24% higher than a year ago and five times than five years ago. The amount of product that was exported equaled about 18% of what was produced nationally. The top three destinations of distiller grains in 2009 were Mexico, Canada and China.

With all the monetary value that distiller grains produce, they are not considered part of the equation when figuring ethanol’s environmental value. Government agencies like the EPA and CARB (California Air Resources Board) punish ethanol production by saying that extra crop production is needed in other areas of the world to make up for grain raised for ethanol production. This anti agriculture “idea” is called the international indirect land-use theory. One example most popularly used by the mass media would be the burning of the Brazilian Rain Forest in order to grow crops. This is simply insanity.

The flawed theory needs to realize that a lot of factors come into play when deciding land uses across the globe. More importantly, American farmers are becoming more and more productive each year with record yields, producing more crop on less land making expansion of the biofuels industry possible. It’s also important to realize that distiller grains from ethanol production are feeding a substantial amount of the world’s livestock.

With corn ethanol helping reduce our nation’s dependence on foreign oil, the importance of adding in the feed value of distiller grains to ethanol’s energy equation is extremely important and may someday be the ultimate fate of the industry.

As I type this blog post, hundreds of people are typing and tweeting about how much corn is being used to produce ethanol. What they don’t realize is that farmers are producing more corn with less land to meet everyone’s needs and then some. Besides the increase in productivity, the corn used for ethanol produces a very important byproduct that is seldom ever mentioned by anti-agriculture journalists and bloggers, that product is distiller grains.

What are distiller grains?

The corn to ethanol process uses only starch, which is around 70% of the kernel. The rest of the nutrients including protein, fat, minerals and vitamins are concentrated into a valuable feedstock called distiller grains.

Let’s break it down: 1 bushel of corn weighs 56 pounds, and that bushel will produce 2.8 gallons of ethanol and 18 pounds of distiller grains. Basically, one-third of the corn used for ethanol is being fed back to livestock while the other two-thirds are producing clean-burning, home grown ethanol.

Dried distiller grains with solubles, are a popular choice in the feed industry. DDGS are a very high quality protein feed ration that is fed primarily to dairy and beef cattle, but also to swine, poultry and aquaculture. This feed is highly economical costing around $120 per ton equaling less than a $1 per bushel, which helps livestock producers keep down their costs.

This year, dried distiller grains will displace more than 1 billion bushels of corn in the United States and has become a very hot commodity in the global market.

Distiller grains are usually the missing component when the anti-ethanol crowd is figuring the net energy of ethanol. They are also a missing key to the bloggers and tweeps passing on the “Food vs. Fuel” debate.

Distiller grains seem to do so much to get mentioned so little.