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Ethanol opponents duke it out

This Business of Farming

Published on: October 18, 2007

Click on title to read article

Ethanol plants are facing a tough business climate right now. Planned new construction is being put on hold. Facing a potential glut of ethanol in the marketplace, new federal mandates for higher usage are needed to push demand higher. That, or Detroit needs to rethink its warranties and guidelines regarding ethanol blended at 10% with gasoline.

And because ethanol is in a short-term jam right now, the rhetoric on both sides of the ethanol debate is heating up. Witness a recent exchange between Renewable Fuels Association President Bob Dineen and Steve Milloy, founder of Junkscience.com, a website devoted to "debunking faulty scientific data and analysis used to promote special agendas."

This wasn't exactly an exchange. More like a dust-up. Dineen's recent speech defending ethanol can be found here.  He was speaking at the Cellulosic Ethanol Summit taking place in Washington, D.C. a few days ago.

Among other things, Dineen said, "The insidious campaign being waged today has very little to do with the feedstock for ethanol, and a great deal to do with the loss of petroleum market share that will occur if we are successful. To our opponents, there is no good ethanol or bad ethanol; there is only ethanol, and it's all bad.•bCrLf

According to Junkscience.com, Mr. Dinneen chose to attack the "nattering nabobs of negativity•bCrLf who voice legitimate concerns about his industry's agenda. (Does anyone else besides me remember who made this line famous? Get the answer here.)

Junkscience.com's Milloy remarked that, "Ethanol advocates declare in the most sanctimonious manner imaginable that ethanol isn't pork, that it is, in fact, the morally, socially, economically, environmentally-sound fuel of the future.  They verge on hysteria when they tell you about the so-called Brazilian miracle, which actually boils down to fueling cheap, tiny cars in two Brazilian cities.  They become apoplectic over the carbon imprint of gasoline, conveniently forgetting how much fossil fuel is needed to produce their miracle fuel.  They sold ethanol to the public not as pork, but as the fuel that will transform industrial economies and make the world a better place." 

Milloy goes on to say that Dinneen "is on the verge of a hissy fit demanding governmental protection and financial assistance to protect his lobby from an "insidious campaign•bCrLf by his critics.  Dinneen doesn't understand that when you change the image of a product from pork to a marketable item, the marketplace decides what to do with it.  He needs to calm down, stop the rent-seeking and convince Wall Street that ethanol isn't an organic black hole.•bCrLf
 
Milloy is also a columnist for FoxNews.com.

Jump-Start E85 Availability. That's what needs to happen to kick up demand for ethanol again. One of the stumbling blocks has been legitimate safety certification from Underwriters Laboratories (UL). This week UL announced it had set up those safety requirements for E85 fuel dispensing equipment, providing welcome news for alternative fuel supporters.

"We have been waiting for UL certification requirements for nearly a year so this is great news,•bCrLf says Steve Ruh, Illinois Corn Growers Association president. "This is very significant for corn growers, the ethanol industry and the driving public who have been awaiting better access to E85 fuel."

The expansion of E85 stations stalled last year after the decision by UL to suspend certification of pumps because of concerns that new components on E85 pumps had not been adequately tested. While no serious leaks or related problems were reported, dealers stopped adding the pumps out of liability concerns.

Currently there are more than 1,300 E85 fueling stations open across the United States. With UL's announcement, projections are that number will double in the coming year, creating additional demand for ethanol because of more convenient access to E85. In fact, if the 6 million flex-fuel vehicles currently on the road today were to be operated entirely on E85, potential demand for ethanol could increase by 5.1 billion gallons — nearly 75% of the industry's current production.

Record soybean exports. U.S. soybean farmers have had a record-setting year. Marketing year 2006-2007 ended August 31, 2007, with U.S. soybean exports totaling 1.11 billion bushels.

China retains its title from last year as the number one importer of U.S. soybeans, importing 420 million bushels during this past marketing year. This is up from just over 356 million bushels in the 2005-2006 marketing year. Mexico came in as the second-largest customer for U.S. soybean farmers, importing 141 million bushels, followed by Japan, which imported 116 million bushels.