Fuel from the furrows
Ethanol gets a boost from Missouri lawmakers

by Jim McCarty

Roger Hill, Golden Triangle Energy’s general manager, stands in front of a growing pile of distillers grains. The ethanol coproduct is a high-quality feed.

When Gov. Matt Blunt delivered his State of the State speech in January, Missouri farmers were dancing in the halls of the Capitol. That’s because the governor threw his full support to making the state a leader in the ethanol industry, calling for full funding of the ethanol incentive fund.

“Missouri farm families will benefit from many of the initiatives we are discussing tonight,” Blunt said in his annual address to all Missourians. “I support full funding for the bio-diesel and ethanol incentive funds, which will help position Missouri as a national leader in the fast-growing renewable fuels industry.”

The governor had already made ethanol a priority during his first year in office. At a grand opening ceremony for Mid-Missouri Energy, Missouri’s third ethanol plant located in Malta Bend, Blunt said, “There is no reason to remain dependent on Middle Eastern oil when our farm families can produce cheaper, higher-quality fuel right here in our own backyard.”

Already three bills have been introduced in the statehouse that would require all fuel sold in Missouri after Jan. 1, 2007 to contain at least 10 percent of the renewable fuel made from fermenting corn. That’s good news to corn producers, the three Missouri plants already producing ethanol and the two new ones in the works.

“It’s beyond fantastic,” says Byron Fink, president of Golden Triangle Energy Cooperative based in the northwest Missouri town of Craig. “We’ve got all the magic ingredients: cheap corn and high-priced energy. The only chink in the armor is the price of natural gas and that’s come off significantly.”

Adds John Eggleston, president of the Northeast Missouri Grain plant in Macon, “When I heard the governor’s speech the other night, I almost had to pinch myself because of what has transpired in the last 15 years. That’s almost like a dream come true.”

Leaders like Fink and Eggleston can rightly feel vindicated when they look at the positive direction the ethanol industry has taken. Just 10 years ago the two traveled the state urging reluctant farmers to invest in the dream of adding value to their corn.

The Golden Triangle ethanol plant is one of three in Missouri. Two more plants are in the works.

Fink, a former director for Northwest Missouri Electric Cooperative (now part of United Electric), remembers when promoters outnumbered potential investors at meetings held around the state. Today those who took the plunge are wishing they had invested more in these new generation cooperatives.

The industry is poised to take on an increasingly larger share of the fuel market. And that can only be good news to the public, which is still reeling from the price of gas.

With lawmakers from Missouri’s governor to its two U.S. Senators Jim Talent and Kit Bond throwing their support behind ethanol, Missouri’s growing industry is expecting demand to skyrocket.

During debate on the energy bill Sen. Talent helped add legislation that will increase availability of E85, a blend of 85 percent ethanol and 15 percent gas, by giving station owners a tax incentive to switch pumps to E85. He also helped negotiate the Renewable Fuels Standard which would add 7.5 billion gallons of ethanol, biodiesel and other renewables to the nation’s fuel supply by 2012.

The Northeast Missouri Grain plant located in Macon has already expanded since it began operation in 2000. Originally designed to produce 15 million gallons of ethanol a year, in May 2003 the plant nearly doubled in size. Constant tweaking by its engineers lets the plant operate at more than 100 percent of its rating, turning out a whopping 46 million gallons a year.

The Macon plant also sells carbon dioxide, a coproduct of producing ethanol. The plant has contracts with food, meat and beverage companies for 100 percent of its carbon dioxide output.

In addition, corn that has been turned into ethanol remains a high-quality cattle feed. “It’s very good feed,” says Roger Hill, Golden Triangle’s general manager. “We sell lots of it to feed lots and dairies. Most of it stays within a 100-mile radius.”

Adds Fink, “We are sold out and I think that is the case all over the country. They can’t take any new customers and that is scary.”

While the increased demand for ethanol and its coproducts is exciting to industry leaders, the real purpose in putting these plants together was to add value to the corn they produce. By that measure, the three plants have succeeded beyond anyone’s wildest dreams.

Eggleston says in northeast Missouri the ethanol plant has added 25 cents to the price of a bushel of corn. Hill estimates Golden Triangle has raised the price of corn 10 to 15 cents a bushel in Missouri’s northwest corner.

“Overall around the state, that’s somewhere around a nickel or a dime and that’s for every farmer,” Eggleston says.

As the Missouri Corn Growers Association likes to point out, Missouri has two oil wells and no refineries but millions of acres of corn. Last year the state’s 20,000 corn growers produced 320 million bushels of corn despite drought conditions. Every bushel of corn can produce 2.8 gallons of ethanol.

Missouri once imported 100 percent of its gas. Currently half of the fuel used in the state is blended with ethanol. With two new plants in the works and a host of politicians supporting the fuel, ethanol is poised to help Missouri meet its energy needs.

Better still is the investment in rural areas that is coming with these plants, located in places like Craig, Malta Bend, Macon and Laddonia.

“You look at rural Missouri and you can say the same thing about Iowa,” says Fink. “There’s been no new investment since they tore up the rails in the ’50s. We’re not going to turn it around with 33 jobs, but at least it’s a step in the right direction.”

A study done in 2002 predicted that with five plants in operation Missouri would see a $1 billion impact on the economy and the creation of 8,890 new jobs. A new study in the works will show the full impact of ethanol on the state’s economy today.

Ag leaders hope to use that study to make ethanol a major player for Missouri’s energy future.