SD Corn

Have you read a paper lately? If so you might be under the assumption that we are all going to starve and the world is going to end. That might be a bit sarcastic but there is a lot of doom and gloom in the press lately due to the depressing drought (and rightfully so in some instances). But let’s not get our bushels in a bundle before we reach the finish line.

The drought of 2012 will indeed decrease the amount of crops produced in the United States, which has once again reproduced the old “Food vs. Fuel” debate as the media frets over using corn to produce fuel while failing to mention the impact of the co-product, distiller grains, and in some cases not mentioning the livestock feed at all.

Below are a few key stats to keep in mind when it comes to ethanol…

The ethanol production cycle produces both food and fuel. The starch from the corn is used to make clean-burning ethanol fuel while the protein, fat, fiber and remaining nutrients of the kernel make up the popular and efficient livestock ration, dried distiller grains.

Dried distiller grains amount to about one-third of the original corn used in the ethanol process. So whatever number the media claims that ethanol is consuming, divide it by three and that is how much DDG is being produced from those same bushels. But the news gets even better.

DDG’s are also more efficient than corn, meaning it takes less to meet the same nutritional needs. The product has become far more than a fad in livestock rations as it has become a preferred source of protein by livestock growers around the world and the number two feed source behind corn and ahead of soybean meal in the United States.

In 2011 alone there were 39 million metric tons of DDG’s produced in the United States, which displaced the need for around 1.2 billion bushels of corn for feed. That amount totals as the fourth-largest corn-producing country in the world.

Where are the news stories including those stats?

So, the next time you read an article about ethanol consuming too much corn, remember that the question isn’t Food or Fuel, but instead the answer is Food and Fuel.

Distillers dried grains, “work wonders” according to livestock feeders and its popularity, production efficiency and known feed value are all continuing to grow.  Simply put, the byproduct of corn ethanol has suddenly become a highly demanded co-product.

A report just last week showed that DDGs has replaced soybean meal as the number two livestock feed in the United States, second only to its former self, corn. The popular ration now claims a 17.5% share of America’s feed market.

Livestock feeders are continuing to efficiently substitute more DDGs into their animal rations in exchange of less corn and soybean meal.  According to the U.S. Department of Agriculture, one ton of distillers grain can replace 1.22 tons of corn and soybean meal. This can be attributed to the feed’s higher energy and protein content.

That efficiency has lead to some interesting ration substitution analysis. According to an article in Ethanol Producer Magazine, in 2011 DDGs replaced 7.6 million acres of corn and 5.86 million acres of soy.

In different terms, Economist Robert Wisner calculates that DDGs displaced well over one billion bushels of corn and 6.2 million tons of soybean meal in 2011.

An estimated 42.29 million tons of DDGs will be produced in 2012, up from 39 million tons in 2011. Experts claim that potential consumption of DDGs is somewhere around 60 million metric tons which will make for an interesting future in a growing world where the demand for protein has never been greater.

It’s rarely mentioned by the ethanol haters and touted by the rest, distillers grains. Just ask any livestock producer using it, the stuff works and it’s cost effective too. Now a new report shows that its feed value and production efficiency are even better than originally thought.

According to the U.S. Department of Agriculture, one ton of distillers grain can replace 1.22 tons of corn and soybean meal. This can be attributed to the feed’s higher energy and protein content.

 USDA also noted that instead of just 1/3 or 33% of the corn being used for ethanol coming back as distillers grains, it’s actually around 40% (weight). Most people don’t realize that the ethanol process only removes the kernels starch content leaving behind the protein, fat, fiber and other nutrients for livestock feed.

 “The value of the animal feed produced by the ethanol industry has long been misunderstood, understated and misrepresented,” said Geoff Cooper, RFA Vice President of Research & Analysis. “Distillers grains continue to be the industry’s best kept secret, despite the fact that we are producing tremendous volumes of this high value feed product today. DDGS and other ethanol feed products significantly reduce the need for corn and soybean meal in animal feed rations. Over the past several years, distillers grains have been one of the most economically competitive sources of energy and protein available on the world feed market. While some critics of the ethanol industry attempt to downplay the role of DDGS, the facts simply can’t be ignored.”

This year the United States will produce 13 billion gallons of renewable ethanol fuel and 39 million metric tons of distillers grains. That amount of distillers grains is equivalent to the 4^th largest corn crop in the world. DDGs will displace more than one billion bushels of corn for feed in the U.S. this year alone and 1/4^th of it will be exported. Through ethanol production, America’s family corn farmers are reducing our nation’s dependence on foreign oil and feeding countries around the world by utilizing co-products like DDGs, efficiently using corn to produce both Food and Fuel.

Ethanol fuel production is the largest user of South Dakota corn consuming approximately 50% of the state’s supply this year totaling 346 million bushels.

Ethanol is providing South Dakotans and Americans alike with a domestic, clean-burning, alternative fuel that saves consumers money at the pump and lessens our countries dependence on foreign oil. Ethanol has helped produce thousands of jobs in both rural and urban South Dakota and according to EPA, ethanol produces 52% less greenhouse gases than conventional gasoline.

The state of South Dakota ranks 5th nationally as it produces over one billion gallons of ethanol annually. The state will be consuming more of that renewable fuel as it will soon become the national leader in ethanol blender pump locations.

You might be thinking to yourself, “that’s a lot of corn to make a fuel,” but you need to remember that a third of the corn used in ethanol production comes back as dried distiller grains (DDG’s). In South Dakota, DDG’s replaced 25 million bushels of corn in 2010. The state produced at total of 2.7 thousand metric tons of DDG’s in 2010 with 2.1 thousand metric tons being exported and the rest being fed to South Dakota livestock. Ethanol production is providing both a clean-burning, renewable fuel and a high-protein feed for livestock around the world.

Corn ethanol will not be the complete long-term answer to breaking our countries dependence on foreign oil, but it is creating a market for futuristic biofuels and establishing the necessary infrastructure to compete with oil moving forward.

South Dakota is known for producing an abundance of quality corn and that corn is in high demand abroad with much of the world not able to meet their own food and feed demands. South Dakota farmers take pride in helping feed the world, and those demands aren’t going away anytime soon with an ever increasing population.

“Export markets are an important part of U.S. corn consumption as American corn farmers continue to grow more corn per acre than anyone else,” said NCGA Trade Policy and Biotechnology Chairman, Chad Blindauer, a farmer from Mitchell, South Dakota, U.S. “We are always working on building new markets, here and abroad, for U.S. corn and support efforts to open overseas markets for conventional corn.”

As South Dakota produced a record corn crop in 2009, exports totaled 30% and will be at a similar percentage again in 2010 helping various countries meet their food and feed needs.

Steve Domm, General Manager at Central Farmers Cooperative said, “We export around 35-40% of our corn, but I expect South Dakota corn exports to stay static with local ethanol production.”

With ethanol production comes dried distiller grains (DDG’s), a high protein, partial replacement to corn that’s popularity has grown rapidly both domestically and in the export market. South Dakota has been a leader in DDG use and production as they exported over two metric tons of DDG’s last year and will do so again this year.

“Increased ethanol production means increased DDG production,” said Blindauer. “While our corn export percentages may stay level, DDG exports will continue to grow and thrive meeting future feed needs abroad.”

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.