Download - Starch Italics 11th Edition
GIRACT
Starch Industry Overview
Starch Italics
www.giract.com
J une/J ul y 2011
Starch Italics Starch Industry Overview
June/July 2011 TABLE OF CONTENTS
Crops & Grains
p.1 Collaboration on cassava-based ethanol
Tapioca flour and exports growth areas
p.2 Humphrey Feeds weekly feed report
p.3 Tight corn stocks to fuel scrutiny of
ethanol use
p.4 Food: Deal Will Help Build a Better
Cassava
p.5 Corn used for ethanol increased, sorghum
decreased
Brazilian cane harvest improves, ethanol
production surges
Starch & Derivatives
p.6 Microfluidization for cassava starch
modification
Sugar, starch boost lifts Agrana to four-
year high
Company News
p.7 Roquette Announces the Completion of its
New Injectable Carbohydrate Plant
Schweppes, ZIA, ethanol plant, Hwange
Colliery Company
Bio-Fuels
p.8 Bowyer champions the increased use of
ethanol in gasoline
p.9 Iowa Ethanol Factory to Begin Converting
Corn Waste Into Motor Fuel
p.10 USDA to help fund planting crops for
biofuel
p.11 Genencor launches enzyme product to
advance biofuel production
p.12 ABF eases cloud over Europe's wheat
ethanol sector
p.13 Süd-Chemie breaks ground on German
wheat straw-to-ethanol plant
p.14 Petrobras Expands In Biofuel World
p.15 European Commission approves first
sustainability schemes for biofuels
Bio-Fuels (Contd)
p.16 Kansas gets another biofuels project
Extension of ethanol tax credits would
boost corn production
Feature: Growing up and across
p.17 Farmers, ethanol makers likely OK
without subsidy
p.19 Cellulosic ethanol and cold fusion
p.20 Ethanol, soy demand drive up food prices
Seaweed Could Be New Form of Biofuel
p.22 Ethanol Industry Torn Over Losing
Subsidy Billions
p.24 Valley plants plan to make corn-free
ethanol
p.25 BP Biofuels confirms 2012
groundbreaking for US cellulosic ethanol
project
p.26 AE Biofuels acquires Zymetis for
renewable fuels, chemicals
Biofuels firm wins verdict over Colwich
ethanol site
p.27 Corn ethanol subsidy to end
Bio-Plastics
P.28 Plastic by Any Other Name
p.29 Bio-plastic plant for JK grounded
Regional Language News
China
p.31 The current dynamic market conditions
Shandong corn
Gansu Dingxi report on the development
of the potato industry
p.33 corn prices of Hebei province on June 10,
2011
p.34 Starch, sugar prices to settle and sales in
general June 17, 2011
(Table of contents continued on next page)
Starch Italics Starch Industry Overview
June/July 2011 TABLE OF CONTENTS
GLOSSARY
bio ‗000 000 000
cpd cases per day
crore ‗0 000 000
JV Joint Venture
k ‗000
kt ‗000 tons
klpd kilo litres per
day
lakh ‗00 000
lpd litres per day
mio ‗000 000
M&A Merger
&Acquisition
pa per annum
t tons
tpa tons per annum
tpd tons per day
tph tons per hour
tpm tons per month
GIRACT Global Starch and Starch Derivatives study
Giract has just published new
multi-client research into global starch
supply, examining in particular the
impact of the recent economic
downturn on the industry. Details on
the following page.
Regional Language News (Contd)
Vietnam
p.37 Cassava exports increase as China prices
surge
Portugal
p.38 U.S.: Ethanol Gasoline Futures Plunge
the Hold Steady, Corn Advances
p,39 Ethanol corn leaves 17% more expensive
p.40 The development of bioethanol production
is possible only in case of cancellation of
excise duty USDA
Spanish
p.41 The U.S. Senate vote to end subsidies for
ethanol
Indonesia
p.42 EPA mandate to reduce its cellulosic
ethanol again for 2012
Belarus
p.42 Corn, Soybeans Fall on Speculation of
China to raise rates ; Wheat Advances
Brazil
p.44 Sale of ethanol in jobs fell 8.5% in 2010
GIRACT
Starches and Derivatives Impact of the economic downturn Global Production and Supply 2009/10 – 2015
INTRODUCTION The starch industry is one of the world’s largest transformers of agricultural raw material, producing 73 million tons (expressed as primary starch with 12% moisture). For 30 years the starch industry has posted a remarkable average 4% annual growth and shown great flexibility to adapt to changes and opportunities, from raw material sources and changing trade regulations to new production technologies and end-use sector dynamics.
Since 2007, this dynamic has changed abruptly for several reasons:
High demand for agricultural raw materials by the fast growing Asian economies coincided with new competition from the bio-energy boom, especially in USA, leading to a record high in raw material cost
High ingredient costs forced the food industry to undertake a strong cost-cutting drive, and even though starch and their derivatives were earlier seen as ‘low-cost’ ingredients, they have now become a target for replacement in several end-uses
Starch production in Asia continued to expand, fuelled by strong local consumption especially in China, while European players were facing more blows from the ongoing CAP reform in the sugar and potato starch sectors
The economic recession affected starch demand as never before and in almost every end-use sector; e.g. the European paper industry saw a decline by 40% and with enough new mills in low wage countries, this demand in Europe may never be recovered.
Thus, the traditional patterns in starch production and demand have changed dramatically and so did the competitive landscape. The dominant position of Western players and markets is being eroded, both in terms of product portfolios and players and China has emerged as the largest country for supply and demand of starch. Cost-effectiveness and clean labelling have been driving changes in demand.
As these new patterns are emerging, it is the right time for every player and end-user in this field to take stock of new opportunities and threats before making any strategic decisions. This report provides the necessary comprehensive picture of actual global starch production and trade, by product and area, and explores which key factors are likely to influence the future to 2015.
Giract, the ingredients and technologies specialist and leader in market analysis of starches and their derivatives, published landmark studies in ’95, ’00, ’04 and ‘07 which pulled together starch supply by type of raw material and player across the world. These studies have been a reference for all players in the industry and for key end-users. The present update, published in autumn 2010, takes into account the various changes that have occurred across the world in the last few years, and thus acts as an important tool in your strategic planning.
OBJECTIVES • To identify starch and derivative production
- by key country/region - by type of raw material - by type of starch and starch derivative - by key producer • To evaluate trade patterns of different types of starches and derivatives • To estimate availability of starches and derivatives by key country/ region and of starch by type of raw material • To forecast global trends in starches and derivatives to the year 2015
PRODUCTS Primary starch from different raw materials, including maize, wheat, potato and tapioca. Finished products as starches (native and modified) and starch derivatives (glucose syrup, high fructose syrup, dextrose, other hydrolysates and polyols)
MARKETS Global
TIMESCALE 2009/10 and 2015
REPORT Published September 2010
SUBSCRIPTION Please contact us for subscription details
For more info, contact GIRACT V. Krishnakumar, Jo Goossens
24, Pré-Colomb Tel: + 41 22 779 0500
1290 Versoix/Geneva Fax: + 41 22 779 0505
Switzerland [email protected]
www.giract.com
June/July 2011 www.giract.com Page | 1
Starch Italics Starch Industry Overview
Crops & Grains
Collaboration on cassava-based ethanol
Thailand has teamed up with neighboring
countries to develop ethanol from fresh cassava,
aiming to turn the kingdom into a regional
technology and production centre for
cassava-based renewable fuel. Under a
programme called South-South Technology
Transfer --- ethanol production from cassava,
which is funded by the Global Environmental
Facility (GIF), Thailand will be a focal point in
forging cooperation with Vietnam, Laos, and
Burma. The four-year project, which will be
launched next year, includes two pilot ethanol
plants to be built in Thailand and Vietnam. The
facilities could be developed for commercial-scale
production in the next phase through a partnership
with interested investors and banks.
The Thai pilot project will be located at an
alcohol production plant of the Liquor Distillery
Organisation (LDO) in Bang Khla,
Chachoengsao, to produce ethanol from fresh
cassava between 2012 and 2013. Next month it
will test ethanol production from tapioca chips,
and it has produced molasses-based ethanol in the
past. "The main problem for ethanol production in
Thailand now is the relatively high cost of raw
materials, as the price of molasses is increasing,"
said LDO Director Ittithep Visessmit. Tapioca
chips are now priced at THB 7/kg, compared to
THB 3/kg for fresh cassava, which also generates
a higher yield for ethanol production.
"Once we can produce ethanol from fresh cassava,
we will contract with farmers to lower the cost of
raw materials," he added. The pilot plant in Hanoi
will be operated between 2013 and 2014 with
capacity of 50 litres a day of E100, less than the
200 litres at the Thai plant, said the
United Nations Industrial Development
Organisation, a partner in this project.
(Continued in next column)
Collaboration on cassava-based ethanol (Contd)
The National Science and Technology
Development Agency will receive THB 80 mio
from GIF to help with technology transfer to
neighboring countries, as Thailand is more
advanced in this area. Thailand is the world's
largest exporter of tapioca products, with annual
production of 25-30 mio t. (bangkokpost.com
23 June 2011)
Tapioca flour and exports growth areas
The Thai tapioca industry will focus on flour
exports and Asian markets as part of its growth
strategy over the next five years, when the exports
of tapioca products could reach THB 100 bio. The
Commerce Ministry projected that by 2016,
domestic demand for cassava roots in ethanol
production will surge to 13 mio t, while exports
could top 22.5 mio t, totalling 35.5 mio t, up 42%
from the current production levels. Speaking at
the World Tapioca Conference 2011,
Yanyong Phuangrach, the ministry's permanent
secretary, said Thailand should focus more on
exporting tapioca flour to substitute for a
reduction in the export of tapioca chips and
pellets. The proportion of flour exports is
expected to rise to 65% from 51% now, with
chips and pellets making up the rest.
Mr Yanyong said the country should build a good
image and accept the standards of its tapioca flour
and other products to create confidence among
importers, buyers and local consumers. Thai
exporters should also expand in promising
markets, especially in Asia countries such as
China, India and Indonesia, to ensure flour quality
and lower transport and insurance costs. Sharing
his view was Pramote Kongthong, President of
the North Eastern Tapioca Trade Association,
adding that tapioca flour has high potential to be
used in food, energy and other industries.
(Continued on next page)
June/July 2011 www.giract.com Page | 2
Starch Italics Starch Industry Overview
Crops & Grains
Tapioca flour and exports growth areas (Contd) He is confident Thailand's exports of tapioca
products will exceed THB 100 bio over the next
five years. Currently, there is more investment in
tapioca flour factories to supply major customers
in China and India. Tapioca is a key economic
crop for the country, creating jobs and income for
more than 500 000 families, with plantation areas
of about 6.5 mio to 7 mio rai.
Casava Balance Sheet
Supply and Demand (mio t)
2009-10
2010-11
1st Survey
2010-11
2nd
Survey
Supply 31.7 24.9 21.9
Demand 28.8 23.7 21.0
Starch 15.8 13.5 12.3
Chips &
Pellets
11.3 8.5 7.0
Ethanol 1.7 1.7 1.7
Carry out 2.9 1.2 0.9
Thailand harvests approximately 20-25 mio t of
cassava roots each year, 75% of which are
processed for export. Last year, the country
shipped 7.27 mio t of all types of tapioca products
worth USD 2.15 bio (THB 68.3 bio).
Seree Denworalak, President of the Thai Tapioca
Traders Association, said tapioca exports this year
were projected at THB 73 bio, of which
THB 44 bio would be tapioca flour.
However, the figures may change after a survey
on cassava root production in September. (bangkokpost.com 29 June 2011)
Humphrey Feeds weekly feed report Ethanol reached a 3 year high yesterday on fears
of accelerating demand against a backdrop of
limited maize supplies worsened by enduring hot
weather in the cornbelt. Similarly wheat exports
were increased by 100mb. This USDA report
combined with a hot weather forecast stimulated
fund buying--- but this was tempered by events in
the EU. In the near term, the USDA‘s reputation
is suspect, so weather will be the biggest
influence on the markets. In the EU Strategie
Grains believe that rain boosted EU grain
production by 6.6t to 282t, with wheat put at 130t,
almost 3mt more than last year. November UK
wheat traded +/-GBP 5 around GBP 163 this
week.
Russia is a very cost-competitive wheat exporter
at approximately USD 30-100/t below anyone
else, and has recently sold 150kt to Jordan and
180kt to Egypt. The Russian wheat harvest
(June/July) is looking good and grain estimates
have increased to 87-92t after timely rain
(previously 82-86t, and only 61mt last year due to
drought), of which 55-58t is wheat. They are
expected to export 17mt.
The three key worries this year have been the
EU zone sovereign debt issue, a stuttering
US economic recovery, and a slowing Chinese
economy. ‘Contagion‘ was the financial
EU buzz word this week.
(Continued on next page)
June/July 2011 www.giract.com Page | 3
Starch Italics Starch Industry Overview
Crops & Grains
Humphrey Feeds weekly feed report (Contd)
The trade believes that China has already
imported 5t of maize this year; which is only
10 days consumption! China expects to harvest a
record 181t of maize this year, and has sold
almost 31t of maize from government stocks since
January 2010, so it is not inconceivable that it
may still need to buy 10-15t to replenish its stores.
Goldman Sachs believes in the short term US
maize prices will outperform soya due to the low
carry-out, but longer term believes soya has more
profit potential than cereals.
Spot GM soya is about GBP 290 delivered to the
mill, and GBP 32/t more for non-GM.
(farminguk.com 17 July 2011)
Tight corn stocks to fuel scrutiny of ethanol use
The tightness of corn supplies is likely to heighten
the backlash against the use of the grain by
ethanol plants, which are for the first time in
2011-12 set to consume more of the crop in the
US than livestock farmers.
Ethanol producers scored two political
concessions in the last six months, the first
financial, when they won the extension this year
of tax perks for blenders, and a tariff hurdle
against imports.
(Continued in next column)
Tight corn stocks to fuel scrutiny of ethanol use (Contd) The second was an image enhancement, in
winning a change of wording to US Department
of Agriculture accounting of the industry, to note
in its publications the distillers' grains livestock
feed produced as a byproduct of ethanol
manufacture, besides just the biofuel itself.
"There has been no small amount of wailing,
name calling and political wrangling over the way
that the USDA accounts, or does not account, for
distillers' grains in the feed supply," a report from
livestock experts Steve Meyer and Len Steiner
said.
"Many of these politicians have accused those
who oppose government subsidised and mandated
ethanol of simply ignoring distillers' grains, which
have been touted as a wonderful 'contribution'
from the ethanol sector."
'Going to hot up' However, the industry may be forced to renew its
defence of itself after the USDA last week made
substantial cuts to its estimate for domestic, and
world, corn inventories, forecasting domestic
stocks would end 2011-12 at a historically weak
level for a second successive season.
"Never in history have we had such tightness in
supplies in back to back years," Don Roose,
President of US Commodities, told
Agrimoney.com.
(Continued on next page)
June/July 2011 www.giract.com Page | 4
Starch Italics Starch Industry Overview
Crops & Grains
Tight corn stocks to fuel scrutiny of ethanol use (Contd) "It looks like corn prices are going to stay high for
another year. The food versus fuel debate is going
to hot up." The comments came ahead of a vote in
the US Senate on ethanol subsidies in what could
be the first step on their elimination.
"The House of Representatives is not expected to
address the issue in the next couple of months,"
Brian Henry at Benson Quinn Commodities said.
Decline in oats
The Meyer and Steiner report said that while
distillers' grains had filled some of the gap
presented by diverting corn from feed use to
ethanol production, "the trade is still three pounds
of corn for one pound of distillers' grains".
The total of corn and distillers' grains has actually
been trending downward slightly.
Tom Elam of FarmEcon added that the picture on
feed supplies appeared even more distorted by
ethanol when considering a dash by farmers to
corn from the likes of barley, oats and sorghum.
"Corn acres have grown at the expense of the
other three feedgrains," Dr Elam said, with
production of the three grains more than halving
between 1990 and 2010.
The US oats harvest shrank by nearly
three quarters.
(Continued in next column)
Tight corn stocks to fuel scrutiny of ethanol use (Contd)
Ethanol plants vs livestock farms
The USDA last week, in its latest Wasde report on
world crop supply and demand, pegged the
domestic corn harvest this year at 13.2 bio
bushels, 305m bushels lower than previously
expected.
Inventories will end 2011-12 at 695 mio bushels,
a downgrade of 205 mio bushels, with the cut in
production in part offset by a lower forecast for
feed use, to 5.0 bio bushels.
The revision left consumption of corn by ethanol
plants, at 5.05 bio bushels, set to exceed that of
use in livestock feed for the first time.
However, Mr Roose added that, longer term,
livestock farmers may regain their advantage, as
the bioethanol industry switches to the next
generation of feedstock, such as waste cellulose
matter, and with biofuel subsidies expected to be
withdrawn. (agrimoney.com 14 June 2011)
Food: Deal Will Help Build a Better Cassava
A roundabout deal for a tiny snippet of DNA that
will help build a better cassava was announced
recently by the Dow Chemical Company and the
Donald Danforth Plant Science Center in
St. Louis.
Cassava is an important food crop eaten by
800 mio people in Africa, Asia and Latin America
(it is also called manioc, tapioca and yuca). It is
prone to many diseases, but little research is done
on them because cassava is a poor people‘s crop.
(Continued on next page)
June/July 2011 www.giract.com Page | 5
Starch Italics Starch Industry Overview
Crops & Grains
Food: Deal Will Help Build a Better Cassava (Contd)
The promoter DNA doesn‘t assemble proteins,
but signals other genes to do so, he explained. The
Danforth Center is isolating genes that make
cassavas resistant to mosaic and brown streak
disease, and it needs this promoter to make them
work.
Dr. Fauquet‘s team originally found the 35 S
promoter in a cassava virus 15 years ago, when he
was at the Scripps Research Institute in
California. Scripps licensed it to Dow
AgroSciences in return for royalties, because it
works in many plants, including transgenic
soybeans and beets. Now that Danforth, a
nonprofit institute, has resistant cassavas ready for
production, Dow has granted a royalty-free
sublicense. (.nytimes.com 27 July 2011)
Corn used for ethanol increased, sorghum decreased
Projected corn use for ethanol is raised
100 mio bushels for 2011/12 and 50 mio for
2010/11. Continued expansion in the ethanol
sector as reported by Energy Department weekly
data for recent months, favorable margins for
refiners, and long-term trends in fuel consumption
resulted in the increase to 5 150 mio bushels in
2011/12 and 5 050 mio in 2010/11.
(Continued in next column)
Corn used for ethanol increased, sorghum decreased (Contd) Sorghum food, seed, and industrial use is lowered
5 mio bushels for 2011/12, with this month‘s
25 mio bushel reduction in projected supplies and
likely sharp production declines in the Southern
Plains, due to the ongoing drought.
Projected food, seed, and industrial use of corn for
2011/12 advance 95 mio bushels, with increases
in corn for ethanol partly offset by lower expected
use for HFCS, reflecting slower shipments to
Mexico.
For 2010/11, food, seed and industrial use
increases 30 mio bushels as corn use for starch
and HFCS is reduced 20 mio bushels, partly
offsetting the higher projected corn use for
ethanol.
Corn export projections for 2011/12 are increased
to reflect increased demand from China.
Projections of sorghum exports are lowered 5 mio
bushels to reflect tighter supplies. For 2010/11,
corn exports are lowered 25 mio bushels to reflect
slower shipments in recent months.
(cattlenetwork.com 16 July 2011)
Brazilian cane harvest improves, ethanol production surges
In Brazil, UNICA reports that the volume of
sugarcane processed by mills in the South-Central
region of Brazil totaled 40.39 mio t in the first
half of July, an increase of 2.34% compared to the
same period a year ago.
Total crushing from the beginning of the harvest
to July 16 reached 217.40 mio t, down 14.81%
from 255.19 mio t processed over the same period
in the previous harvest.
(Continued on next page)
June/July 2011 www.giract.com Page | 6
Starch Italics Starch Industry Overview
Crops & Grains
Starch & Derivatives
Brazilian cane harvest improves, ethanol production surges (Contd)
Despite a drop of almost 40 mio t in the amount
of crushed cane since the harvest began compared
to last year, anhydrous ethanol production by
July 16 checked in with an increase of 14.32%,
for a total of 3.16 bio liters against 2.77 bio liters
produced in last year‘s harvest over the same
period. (biofuelsdigest.com 28 July 2011)
Microfluidization for cassava starch modification
Researchers at National Nanotechnology Center
(NANOTEC) in Thailand have discovered that
using microfluidization has an effect on the
structure and thermal properties of cassava
starch-water suspension (20% w/w). "This is the
first time that anyone has ever used
microfluidization for cassava starch modification"
said Dr. Kittiwut Kasemwong, researcher at
NANOTEC Nano-Delivery Lab.
"After using the microfluidization treatment, we
noticed bigger starch granule was partially
gelatinized, and a gel like structure was formed on
a granular surface. Our investigation indicates that
high-pressure microfluidization process induce
the gelatinization process which is crucial for
granule swelling and water access".
Dr. Kittiwut Kasemwong says this discovery has
many application potentials in the food and drug
industry. According to the Thai Board of
Investment (BOI), the Thai food industry
generates about USD 15 bio dollars annually and
comprises about 30% of GDP.
As for the drug industry, it is estimated that by
2016, Thailand will have the seventh largest
pharmaceutical market in the Asia Pacific region.
Collaborators on this investigation included
researchers from Srinakharinwirot University and
Kasetsart University. (nanowerk.com 08 July
2011)
Sugar, starch boost lifts Agrana to four-year high
Shares in Agrana touched their highest for nearly
four years after "strong" starch and sugar markets
helped the group to better-than-expected profits,
and prompted it to raise hopes for future results.
The ethanol-to-ingredients company, the world's
top manufacturer of fruit preparations, said that
underlying operating profits soared 82% to E62m
in the March-to-May quarter.
Revenues had soared 13.3% to E613m, rising at
twice the pace that analysts had expected. Agrana
shares rose 3.2% to E82.50 in Vienna, their
highest since July 2007.
The Austria-based group said that its
"exceptionally positive earnings development" in
the latest quarter reflected growth in all three of
its divisions - fruit, starch and sugar. However, it
highlighted "favourable market conditions" in the
sugar and starch markets. High international sugar
prices have eliminated Europe's status as a
premium market for exporters, diverting supplies
elsewhere and prompting a shortage in the region.
The European Commission last month agreed
plans for 200kt of zero-duty sugar imports, in
addition to 300kt approved earlier in the year.
Starch prices have been supported by a
disappointing European harvest last year of
potatoes and a shortage of tapioca-based product
from Asia, while high grain prices have lifted the
cost of corn-based alternatives. (agrimoney.com
22 June 2011)
GIRACT 2
nd Starch Forum
Based on the success of our first Starch
Forum, one of its kind in India, we
propose to launch the 2nd Starch Forum
to be held on October 3, 2011 in
Mumbai. Details on the following page.
FORUM, India(venue to be announced)
MUMBAI, OCTOBER 3, 201118h15 to 20h00
GIRACT CONSULTANCIES INDIA PRIVATE LIMITED Tel: 91 422 420 4270
1420, Trichy Road, Coimbatore 641018 [email protected]
Note: It may be necessary for reasons beyond the control of the organisers to alter the content and/or timing of the agenda
Transnational Business Research & Consultancy
GIRACT
AGENDA
18h15 Registration/ Refreshments
18h25 Welcome and opening remarks R. Badrinath, Project Manager
GIRACT Consultancies India Pvt Ltd
18h30 Introduction
V. Krishnakumar, Managing Director
GIRACT, Geneva, Switzerland
18h40 Sustainability in the supply of starch
Speaker from a leading Pharmaceutical/Paper company
19h05 Recent amendments in FSSAI on modified starch
Speaker from FSSAI
19h30 Global trend in modified starch Industry
Speaker from a leading European/Asian starch company
19h55 Summing up and Conclusion
20h00 Buffet dinner and Networking
Geneva, Switzerland
The starch industry has faced numerous challenges and opportunities from other commodities like
emulsifiers and fine chemicals. Based on the success of our first Starch Forum, one of its kind in India,
we aim to bring together a working group from the starch industry (end users, suppliers, distributors,
R&D institutions, Government organizations and analysts) with paper and pharma being one of the
frontiers for growth in India, in order to:
offer an interactive forum for identifying common opportunities and threats in paper and pharma
discuss recent industry developments and their future, with particular focus on the potential for starch
obtain relevant views from eminent speakers from India and other major starch stake holders.
GIRACT has more than 30 years experience in
conducting landmark studies for the global starch
and derivatives market and is recognized as a
leading reference in this sector.
Its nine Starch Conferences held successfully in
Geneva, Switzerland have brought together all the major companies in the industry.
2ND STARCH FORUMINDIAN STARCH & STARCH DERIVATIVES INDUSTRY
UNLEASHING THE POTENTIAL
June/July 2011 www.giract.com Page | 7
Starch Italics Starch Industry Overview
Company News
Roquette Announces the Completion of its New Injectable Carbohydrate Plant The paradox for carbohydrate producers is that
these highly specialized and regulated ingredients
are small scale when compared to the wider
portfolio of products from the starch biorefinery
industry and organic growth is limited.
Carbohydrates for injectable use are highly
controlled pharmaceutical active ingredients that
are essential in the preparation of large volume
parenterals. These crucial lifesaving medicines are
taken for granted in all public health organisations
and institutions.
The large volume injectable solutions prepared
with these carbohydrates, mainly glucose
solutions, are the sort of mass medication that is
expected to be available everywhere and always
of the highest quality. Poor quality or supply
chain issues can lead to critical situations, which
might endanger lives. The paradox for
carbohydrate producers is that these highly
specialized and regulated ingredients are small
scale when compared to the wider portfolio of
products from the starch biorefinery industry and
organic growth is limited. This is further
compounded by health suppliers, hospitals and
clinics regarding them as commodities and as
such a preferred target for price reductions.
Roquette is pioneering pyrogen-free dextrose over
many decades. Such a niche market is a
challenging environment for investment. Roquette
however, decided to proceed with the investment
as part of its long term strategy to remain a
responsible supplier in this demanding field.
(Continued in next column)
Roquette Announces the Completion of its New Injectable Carbohydrate Plant (Contd) In fact, Roquette has pioneered the development
of dextrose grades for the preparation of
injectable and dialysis solutions over many
decades and is the leader in the manufacturing of
such carbohydrates in Europe. This leadership
position comes with a sense of corporate
responsibility to ensure the continuity of these
vital products and this in turn has lead to
continuous investment and an identical facility in
the USA for international supply backup options.
The completion of the most recent investment
phase at Lestrem on its injectable carbohydrate
facility has just been announced. This major
capital investment which was approved in 2008
will support the increasingly sophisticated
demands of the injectable industry in terms of
quality. The facility will be of GMP standard, as
the previous one, so that the integration into
current production capacity will be seamless
though 2011.
Such a major investment is a showcase for
Roquette not only in terms of its manufacturing
and engineering expertise but also of its
understanding of the high quality required and
proactive knowledge of changing European
regulations to meet long term demand for these
life saving medicines.
Schweppes, ZIA, ethanol plant, Hwange Colliery Company Schweppes Zimbabwe Limited plans to
commission a USD12.5 mio juice production line
at its Harare plant by December this year, a move
that would boost its production capacity
(Continued on next page)
June/July 2011 www.giract.com Page | 8
Starch Italics Starch Industry Overview
Company News
Bio-Fuels
Schweppes, ZIA, ethanol plant, Hwange Colliery Company (Contd)
Speaking on the sidelines of the signing of the
Competition Compliance Programme and
Agreement with the Competition and Tariff
Commission, Schweppes Zimbabwe Limited
Managing Director Charles Msipa said the
production line would increase the company‘s
production lines from the current three to
four. ―We have ordered a new production line and
civil works have already started. The new line of
production is expected in the country in
September this year while operations will
commence in 2012,‖ said Msipa. Schweppes
becomes the first company in Zimbabwe to sign a
voluntary competition compliance agreement with
the CTC - The Herald.
Zimbabwe Investment Authority
The Zimbabwe Investment Authority has
approved 75 projects with a projected value of
USD 906 mio in the first 5 months of the year.
This compares with 72 projects with a value of
USD 104 mio in 2010, reflecting an 88.49%
increase in value terms. – NewsDay
Zimbabwean ethanol plant
The first phase of the USD 600 mio ethanol plant
in Chisumbanje is expected to be operational in
the next 60 days with a production capacity of
40 mio litres of fuel expected by December this
year. The project is a joint venture between
government through Agriculture Rural
Development Authority and a private company -
Green Fuel Private Limited. ARDA chairman
Basil Nyabadza, said the required equipment to
finish the plant had arrived in the country from
Brazil. – The Herald.
Hwange Colliery
Hwange Colliery Company has clinched a
USD 3.6 mio coking coal export deal with India
as part of the company‘s export drive.
(Continued in next column)
Schweppes, ZIA, ethanol plant, Hwange Colliery Company (Contd) Under the deal the first consignment of about 20kt
of coking coal is expected to be dispatched from
Hwange to India before the end of the month.
HCC said this would be the first ever consignment
of coal to be moved by a Zimbabwean company
to the Asian country targeting its vast
steel-making industry. (zddt.org 15 June 2011)
Bowyer champions the increased use of ethanol in gasoline
NASCAR‘s Clint Bowyer feels your pain at the
gas pump, too. With gas prices nearing
USD 4 a gallon, it gets expensive even for Sprint
Cup drivers to fill their tanks, and Bowyer, hopes
to champion the use of ethanol-blended fuel
during the STP 400 at Kansas Speedway.
This year, for the first time, all three of
NASCAR‘s top three series — Sprint Cup,
Nationwide and Camping World Trucks — are
running Sunoco Green E-15 fuel, a cleaner and
green alternative fuel component.
Bowyer, of Emporia, will carry the black, silver
and green colors of American Ethanol, led by
NASCAR partner Growth Energy, on his No. 33
Chevrolet this weekend.
The wall at Kansas Speedway has been painted
green between turns two and three for the
weekend races to draw attention to the use of
ethanol, which is produced by corn farmers in the
Midwest. In fact, about 1 100 corn farmers will be
at Kansas Speedway to support Bowyer.
―I don‘t know if you‘ve seen the price of fuel
lately, but this whole country needs to be paying
attention to this ethanol thing, because it‘s a good
way to create independence from foreign oil,‖
Bowyer said.
(Continued on next page)
June/July 2011 www.giract.com Page | 9
Starch Italics Starch Industry Overview
Bio-Fuels
Bowyer champions the increased use of ethanol in gasoline (Contd) Ethanol is the most commercially viable
alternative that America currently has to offset the
economic impact of foreign petroleum. Corn
ethanol reduces emissions by 59%, and cellulosic
ethanol is at least 86% cleaner. By strengthening
America‘s energy independence, ethanol helps
create American jobs. Studies have shown that for
every USD 1 sent overseas for oil, USD 1.55
leaves the U.S. economy.
―The ethanol is cutting emissions more than 50%
already in these cars,‖ Bowyer said, ―and if you
imagine if every car in America had that, not only
could we control fuel prices, but we can control
the emissions we‘re putting in the atmosphere.
―Born and raised in the Midwest that‘s right in
heart of where this corn is grown, so it‘s only
fitting we‘re doing this at Kansas Speedway.‖
E-15 is not available at the corner gas station, but
many pumps have up to 10% ethanol, said
Mike Lynch, Managing Director of green
innovation for NASCAR, and there‘s a movement
to increase that limit to 15% in your car.
―This is to raise awareness and provide a platform
for fact-based dialogue around American
Ethanol,‖ Lynch said of Bowyer‘s relationship
with the corn growers. Lynch said consumers who
want to try E-15 need to contact their
congressmen or senators and gas retailers.
―That would be big,‖ he said. ―We‘ve gotten
close, including that (second-place) to (Greg)
Biffle in 2007. We ran well the first couple races
there, but we‘ve struggled here as of late. It‘s an
important track for me and it would be a hell of a
party, I can promise you that.‖ (kansascity.com
02 June 2011)
Iowa Ethanol Factory to Begin Converting Corn Waste Into Motor Fuel
An Emmetsburg, Iowa, pilot plant is on track to
becoming America's first commercial-scale
facility to create ethanol motor fuel out of corn
waste. Currently the facility produces ethanol
from edible corn by processing one ton of plant
matter every day.
However, after its expansion is complete it will
produce ethanol out of non-edible corn
components (e.g., corncobs, leaves and husks) and
overcome technical challenges to process 700 t
every day.
In the future, company officials believe the
project will displace over 13.5 mio gallons of
gasoline each year. If producing ethanol from
corn waste proves to be a profitable endeavor, it
would decrease the use of edible corn to make this
motor fuel and increase supplies of edible corn.
―Our ultimate target is to be competitive with corn
ethanol and gasoline,‖ said Jeff Lautt, president of
Poet LLC, the company building the
ground breaking facility. Based in Souix Falls,
SD, Poet is the world's largest ethanol producer.
The project is funded by a USD 105 mio loan
guarantee from the U.S. Department of Energy.
(areadevelopment.com 12 July 2011)
GIRACT Sweeteners & Starch Price Monitoring
Giract provides quarterly prices of white sugar,
key starches and their principal derivatives used
in the food industry across major regions. The
report comprises tables and commentary on
price movements as well as charts which track
annual running price series. Details on the
following page.
GIRACT
Sweeteners & Starch Price Monitoring Quarterly Price Review of Starches, their derivatives and Sugar in Key World Markets Now in its 11th successful year ! Giract provides quarterly prices of white sugar, key starches and their principal derivatives used in the food industry across major countries. This report comprises tables and commentary on price movements. In addition, charts track annual running price series. Why should you subscribe to this Price Monitoring? Because you are closely involved with these products and often find it difficult - or impossible - to obtain ex-manufacturer price estimates on a comparative scale across countries Because this is an efficient mechanism to remain abreast of developments Because this monitoring programme has been endorsed by key industry players including ADM, Avebe, BASF, Cargill, CPI, Danisco, GEA, Grain Processing, Lyckeby, Novartis, Novidon, Unilever, … Because Giract is well-known for its in-depth analyses of the world starch and sugar industries over the last 30 years. What does this Price Monitoring contain? Compact tables which provide ex-factory prices in local currency and USD for the key products and countries as shown below (relevant raw materials for each country), along with charts tracking price trends.
Glucose syrup HFS Native Starch Cationic Modified White DE<20 DE 63-65 DE 40-42 42% Maize Wheat Potato Tapioca Starch*
Starch
food grade+ Sugar
China EU India LatAm Russia Thailand USA * LatAm, China, India, Russia, Thailand + EU, USA
How do you subscribe to this Price Monitoring ? By simply filling in the form below and returning it to us or subscribing online at www.giract.com.
Name ______________________________________ Company __________________________________________
Address ______________________________________ Zip/City __________________________________________
Country ______________________________________ E-mail __________________________________________
Tel ______________________________________ Fax __________________________________________
O I would like to receive 4 issues (one year): subscription EUR 1680 O I would like to receive 8 issues (two years): subscription EUR 3050
For more info, contact V. Krishnakumar GIRACT Tel: + 41 22 779 0500 24 Pré Colomb Fax: + 41 22 779 0505 1290 Versoix/Geneva email: [email protected] Switzerland www.giract.com 02-11-1
June/July 2011 www.giract.com Page | 10
Starch Italics Starch Industry Overview
Bio-Fuels
USDA to help fund planting crops for biofuel
The U.S. Department of Agriculture announced
plans to help fund the planting of crops in six
states that will be used exclusively for biofuels
such as cellulosic ethanol. USDA Secretary
Tom Vilsack said the department will be
dispersing to help pay USD 45 mio for the crops
marks the second time it is using its Biomass
Crop Assistance Program, or BCAP, and it may
be the last because of budget cuts being
considered by Congress for fiscal year 2012.
The money in this second round of BCAP funding
will be going to companies like Beaver Biodiesel
LLC and AltAir Fuels LLC, which will be
planting and harvesting 51 000 acres of the
oilseed camelina in California, Montana,
Washington and Oregon. Camelina, Vilsack said,
has proven to be a good crop for making jet fuel.
Abengoa Biofuels will also get money from the
program to plant and grow 20 000 acres of
switchgrass in Kansas and Oklahoma.
Switchgrass, like camelina, can be grown
successfully on "marginally productive" land that
isn't suitable for traditional crops like corn or
soybeans.
All of the ethanol now produced on a commercial
scale in the U.S. is corn-based ethanol, and critics
say the fuel makes food production, especially
meat, more expensive by diverting more than a
third of all corn grown to the fuel. The ethanol
industry is now expected to consume 5.15 bio
bushels of corn produced in the 2011-12 crop
year, which begins September 1st. The
government's ethanol mandates, which began five
years ago and triggered a rapid expansion of the
ethanol industry, require gasoline retailers to use
12.6 bio gallons of corn-derived ethanol this year.
The mandate grows to 15 bio gallons in 2015 for
corn-derived ethanol.
(Continued in next column)
USDA to help fund planting crops for biofuel (Contd)
Corn-based ethanol is expected to continue to
exceed those levels because it remains cheaper
than gasoline, but production of cellulose biofuel,
made from switchgrass, wood chips or other
feedstocks, has lagged.
Growth in cellulosic based ethanol, considered a
second-generation biofuel, hasn't been as swift as
the government would like. Some is being
produced in pilot programs, but there is no
production on a commercial scale.
The Environmental Protection Agency said it was
proposing to lower the requirement for
cellulose based biofuel production next year to
between 3.45 mio gallons and 12.9 mio gallons,
down from 500 mio gallons. The Department of
Energy, though, is trying to help jumpstart the
cellulosic ethanol industry by helping finance the
first-ever commercial scale production plant in
Emmetsburg, Iowa.
Earlier this month Energy Secretary Steven Chu
said the agency is offering a USD 105 mio loan
guarantee to help POET LLC, the largest U.S.
ethanol company, build a plant that makes fuel
from waste from corn farms--husks, leaves and
corncobs--instead of the corn itself.
"The Obama administration is committed to
providing financial opportunities to rural
communities, farmers and ranchers to produce
biomass, which will be converted to renewable
fuels and increase America's energy
independence," Vilsack said. "The selection of
these project areas is another step in the effort to
assist the nation's advanced biofuel industry
produce energy in commercial quantities from
sustainable rural resources. This effort will create
jobs and stimulate rural economies across the
nation." (cattlenetwork.com 27 July 2011)
June/July 2011 www.giract.com Page | 11
Starch Italics Starch Industry Overview
Bio-Fuels
Genencor launches enzyme product to advance biofuel production
Genencor today announced a product
advancement, Accellerase® TRIO. This new
product will enable biofuel producers to more
cost-effectively manufacture cellulosic ethanol
from a wide range of renewable nonfood
feedstocks such as switchgrass, wheat straw and
corn stover as well as from municipal solid waste
"Second-generation biofuels offer important
energy security, as well as economic and
environmental benefits to countries such as the
United States, China, India and European nations
that import a majority of their oil," said Genencor
CEO Tjerk de Ruiter. "Accellerase TRIO can
accelerate the commercial production of cellulosic
biofuels in markets across the world, helping
many countries and companies find a more
sustainable alternative to petroleum."
Accellerase® TRIO allows for a low enzyme
dosage to produce ethanol, helping to improve the
economics of cellulosic biofuel production.
Genencor has improved the effectiveness of
converting biomass into sugars, a critical step in
the production of cellulosic ethanol. With
Accellerase® TRIO, Genencor provides a
combined "cocktail" of enzymes all in one
product to breakdown the glucan (C6) and xylan
(C5) in the biomass feedstock into fermentable
sugars, thus increasing the ethanol yield per unit
of feedstock.
Ethanol producers will discover other benefits.
Accellerase TRIO works with a wide variety of
renewable feedstocks, allowing producers to
select nonfood crops and municipal solid waste
that are abundant in their region to convert to
ethanol or biochemicals.
(Continued in next column)
Genencor launches enzyme product to advance biofuel production (Contd)
In addition, Accellerase® TRIO can help boost
total production by lowering viscosity and
enabling producers to process more biomass.
Accellerase® TRIO is the latest advancement in
Genencor‘s award-winning Accellerase product
line that earned the "Frost & Sullivan 2009 New
Product Innovation Award" for enzymes for
biofuel production and also this year‘s
"Sustainable Technology Award" at the World
Biofuels Market conference in Rotterdam, the
Netherlands.
Genencor‘s mission is to have a significant impact
on the sustainability of every household globally
– and its development of biobased enzymes for
second-generation biofuels helps create a more
sustainable future.
According to the U.S.Department of Energy and
the Center for Transportation Research, cellulosic
biofuels have the potential to reduce greenhouse
gas emissions up to 86% over gasoline.
While still in the early stages of development,
cellulosic ethanol is expected to play a crucial role
in providing transportation fuel in many parts of
the world.
In the U.S., Congress has set a goal of 36 bio
gallons of renewable fuel to be produced by 2022,
with much of that amount coming from second-
generation ethanol.
(Continued on next page)
June/July 2011 www.giract.com Page | 12
Starch Italics Starch Industry Overview
Bio-Fuels
Genencor launches enzyme product to advance biofuel production (Contd)
Europe is requiring that 10% of all road
transportation fuels come from biofuels by 2020,
a mandate that focuses on next-generation
technologies. China‘s 12th Five-year Plan places
great emphasis on the investment and research of
the country‘s ethanol fuel and reducing
greenhouse gas emissions through cleaner fuels.
Genencor has a 25-year history in biofuels
research and development. In 2007, Genencor was
the first company to launch a commercial-scale
enzyme for cellulosic ethanol production,
Accellerase® 1 000, and later the company
introduced Accellerase 1 500 and Accellerase
DUET. (farminguk.com 22 June 2011)
ABF eases cloud over Europe's wheat ethanol sector
Associated British Foods eased the clouds over
Europe's wheat ethanol industry by saying that the
Vivergo plant will open next year, despite the
mothballing of a rival site because of high wheat
prices.
"Following delays caused by contractor
performance issues, construction activity has
recommenced at Vivergo," ABF said, adding that
the "project is expected to complete in spring
2012".
The data is in range of ABF's last estimate, in
April, of completion "early in 2012", and eases
fears among many observers that opening of the
plant, which will take 1.1 mio t of grain a year,
was to be pushed back until lower grain costs
improved the economics of making ethanol from
wheat.
(Continued in next column)
ABF eases cloud over Europe's wheat ethanol sector (Contd)
The plant, which is also being backed by BP and
DuPont, is being built in the north of England,
close to the Ensus site which has been temporarily
shut because of strong grain prices and tough
competition from US exports. Ironically, US corn
ethanol plants are enjoying their strongest margins
since 2009, Morgan Stanley said last week.
'Strong' in agriculture ABF's statement came as it said it remained on
track to deliver flat earnings this financial year,
despite pressures from rising cotton prices at its
Primark clothes retailing operation. The group's
agriculture division, which includes the Frontier
grain merchant part-owned by Cargill, was
"having another strong year", with revenues up
17% so far this financial year.
"UK feed revenues were ahead in all sectors in the
quarter reflecting higher commodity prices for
grain."
Sweeter hopes
In sugar, while revenues had fallen by 6%, year
on year, in the latest four-month period, reflecting
the absence of UK exports following a cold-hurt
beet harvest, a better performance in Spain and
"sharply" higher revenues in China reassured
investors.
(Continued on next page)
June/July 2011 www.giract.com Page | 13
Starch Italics Starch Industry Overview
Bio-Fuels
ABF eases cloud over Europe's wheat ethanol sector (Contd)
Panmure Gordon termed ABF's remarks on sugar
"positive", raising its divisional forecast for the
division and raising its outlook on ABF shares to
"buy" from "hold", and its price target for the
stock to 1200p from 1155p. "With fiscal 2011
essentially done, our attention now turns to 2012,
and even allowing for our more cautious outlook
on grocery and ingredients divisions, we are
raising our earnings per share forecast by 2.5% on
a more positive view on sugar," the broker said.
Equity analysts at Standard & Poor's also raised
their price target for ABF shares, to 1160p from
1030p. (agrimoney.com 14 July 2011)
Süd-Chemie breaks ground on German wheat straw-to-ethanol plant
German-based international specialty chemicals
company Süd-Chemie AG held a groundbreaking
July 26 for a 1kt/year, demonstration scale
cellulosic ethanol plant in Straubing, located in
the Lower Bavaria region. The plant, which is
expected begin production by the end of the year,
will convert wheat straw collected from area
farmers to ethanol using Süd-Chemie‘s
trademarked sunliquid process. The company said
the demonstration plant will be the largest ag
waste-to-ethanol plant in Germany when
complete.
The sunliquid process is a biotechnological
process that utilizes specially developed enzymes
to dissolve the cellulose and hemicelluloses into
sugar monomers in high yields, said Yvonne
Söltl, strategic marketing and communications
manager for Süd-Chemie‘s corporate research and
development department. The process then uses
specialized yeasts developed by Süd-Chemie to
simultaneously convert the C5 and C6 sugars to
ethanol in a ―one-pot reaction,‖ which increases
ethanol yields by up to 50%.
(Continued in next column)
Süd-Chemie breaks ground on German wheat straw-to-ethanol plant (Contd)
Lignin produced from the process will be used to
provide power for the facility. ―In addition, a new
and proprietary downstream processing
technology developed by Süd-Chemie saves up to
50% energy during ethanol separation compared
to standard distillation,‖ Söltl said. ―Hence, the
sunliquid process is almost energy neutral,
resulting in cellulosic ethanol with CO2 emission
savings of 95%.‖
The sunliquid process has been tested at the
company‘s pilot plant for two years. The
demonstration project will further prove the
efficiency improvement capabilities and
cost effectiveness of the process, the company
stated. About GBP 16 mio (USD 22 mio) has
been invested in the project, with an additional
GBP 12 mio invested in accompanying research.
Government financial support has been minimal.
The Bavarian state government and the German
Federal Ministry of Education and Research have
each provided approximately GBP 5 mio for
research efforts, according to Süd-Chemie. The
company declined to specifically peg its
production cost per gallon of cellulosic ethanol.
Söltl said the company plans to begin operating its
first 50kt/year commercial-scale ethanol plant by
2014. As with other first-of-a-kind cellulosic
ethanol plants, the cost to build the first facility
will be substantial and Söltl said political support
will be vital to creating a secure environment for
investors. At the ground-breaking ceremony,
German Federal Minister of Education and
Research, Annette Schavan, indicated that the
German government is committed to assisting in
the build-out of cellulosic ethanol production
capacity. ―Stepping up the replacement of scarce
crude oil stocks with renewable raw materials is a
stated aim of the national research strategy
Bioeconomy 2030,‖ she said. (Continued on next
page)
June/July 2011 www.giract.com Page | 14
Starch Italics Starch Industry Overview
Bio-Fuels
Süd-Chemie breaks ground on German wheat straw-to-ethanol plant (Contd)
―This is why we are funding the development of
biorefineries that can produce valuable chemical
raw materials or biofuel from agricultural waste
products and by-products such as straw.‖
Schavan said GBP 2.4 bio will be available over
the next six years for bioeconomy research
strategy projects, which could include the
sustainable production and conversion of biomass
to food, health, fiber and industrial products and
energy.
―Stepping up the replacement of scarce crude oil
stocks with renewable raw materials is a stated
aim of the national research strategy Bioeconomy
2030,‖ she said. ―This is why we are funding the
development of biorefineries that can produce
valuable chemical raw materials or biofuel from
agricultural waste products and by-products such
as straw.‖
Schavan said GBP 2.4 bio will be available over
the next six years for bioeconomy research
strategy projects, which could include the
sustainable production and conversion of biomass
to food, health, fiber and industrial products and
energy. (ethanolproducer.com 27 July 2011)
Petrobras Expands In Biofuel World
Brazilian state-run energy firm Petroleo Brasileiro
S.A. or Petrobras (NYSE:PBR) acquired a 50%
stake in a local biodiesel company BSBIOS
Industria e Comercio de Biodiesel Sul Brasil S.A.
for 200 mio Brazilian reals or USD 128.4 mio.
Petrobras executed the deal through its subsidiary
Petrobras Biocombustível S.A.
Located at Passo Fundo, the acquired company
owns a biodiesel facility which is integrated with
a vegetable oil extraction unit and has an annual
production capacity of 42 mio gallons of fuel.
(Continued in next column)
Petrobras Expands In Biofuel World (Contd)
The unit is well connected by railroad terminals
and a distribution base for smooth delivery and
marketing of biodiesel.
This acquisition strengthens Petrobras‘ position in
the domestic biofuels market and takes it a step
closer to its target of doubling biofuels output by
2014. The company intends to spend USD 3.5 bio
through 2014 to boost biofuels production to
750 000 cu m in 2014, up from 500 000 cu m at
the end of 2010.
Headquartered in Rio de Janeiro, Petrobras is
involved in exploration, exploitation and
production of oil from reservoir wells, shale and
other rocks, in refining, processing, trade and
transport of oil and oil products, natural gas and
other fluid hydrocarbons, in addition to other
energy-related activities.
We believe that consistent demand growth in
Brazil, along with the new investments and
acquisitions, will fuel Petrobras‘ medium-term
earnings outlook.
Additionally, we expect the company to benefit
from its proficiency in alternative energy
resources application, recent major discoveries
and the growing domestic refined products
market.
(Continued on next page)
June/July 2011 www.giract.com Page | 15
Starch Italics Starch Industry overview
Bio-Fuels
Petrobras Expands In Biofuel World (Contd)
However, we maintain a long-term Neutral rating,
considering the volatile macro backdrop, project
cost overruns and operational hindrances.
Petrobras faces strong competition from its peers
such as ExxonMobil Corporation and Royal
Dutch Shell plc (dailymarkets.com 06 July 2011)
European Commission approves first sustainability schemes for biofuels The European Commission approved new
sustainability schemes that will ensure biofuels
production and supply for its member states.
The European Commission recognized seven
voluntary schemes, which are the International
Sustainability and Carbon Certification, Bonsucro
E.U., Round Table on Responsible Soy E.U.
RED, Roundtable of Sustainable Biofuels E.U.
RED, Biomass Biofuels voluntary scheme,
Abengoa RED Bioenergy Sustainability
Assurance, and the Greenergy Brazilian
Bioethanol verification programme
The recognition of the schemes will be applied to
the E.U.‘s 27 member states. The I.S.C.C. is a
scheme funded by the German government which
covers all types of biofuels. The Bonsucro E.U. is
Brazil‘s roundtable initiative for sugarcane-based
biofuels.
The R.T.R.S. E.U. RED is a scheme focusing on
Argentina and Brazil and is a roundtable initiative
for soy-based biofuels. The R.S.B. E.U. RED is a
roundtable initiative covering all types of
biofuels.
The 2BSvs is a scheme that covers all types of
biofuels in the French industry.
(Continued in next column)
European Commission approves first sustainability schemes for biofuels (Contd)
The R.S.B.A. is an industry scheme for Abengoa
covering their supply chain of biofuel. Lastly,
Greenergy is the industry scheme covering sugar
cane ethanol from Brazil.
The different schemes have been thoroughly
checked by the commission and each gained
recognition for five years. The schemes will
verify where and how the biofuels are produced.
If the produced biofuel met the criteria of the
scheme, the latter will issue a certificate for the
product.
Commissioner for Energy Günther Oettinger said
that, "we need to make sure that the entire
biofuels' production and supply chain is
sustainable. This is why we have set the highest
sustainability standards in the world.‖
―The schemes recognized on the E.U. level are a
good example of a transparent and reliable system
which ensures that these high standards are met,‖
Mr. Oettinger added. Under the sustainability
schemes, biofuels used in the European Union,
whether these are locally produced or imported
from other nations, will have to comply with
certain standards or criteria. The criteria aim to
prevent conversion of areas of high biodiversity
and high carbon stock for the production of raw
materials for biofuels
First, biofuels produced from crops that have been
grown on land that used to be rainforest or natural
grassland cannot be considered as sustainable, as
the biofuel is not capable of being maintained at a
steady level without exhausting natural resources
or causing severe ecological damage to the
forests.
Second, biofuel production processes need to
contain 35% less emissions than that of fossil fuel
production. (Continued on next page)
June/July 2011 www.giract.com Page | 16
Starch Italics Starch Industry Overview
Bio-Fuels
European Commission approves first sustainability schemes for biofuels (Contd)
By 2017, emissions should be less than 50%, and
by 2018, less than 60%.
The sustainability schemes will help the European
Union‘s goal to achieve a minimum share of 10%
renewable energy in transportation by 2020.
Biofuels are used to achieve the target. Bioenergy
companies can choose whether to demonstrate
compliance with these sustainability requirements
through national systems or by joining a voluntary
scheme which is recognized by the commission.
(ecoseed.org 21 July 2011)
Kansas gets another biofuels project
A project to grow switchgrass in Kansas and
Oklahoma is among four announced by the
Agriculture Department.
The project under the Biomass Crop Assistance
Program is sponsored by Abengoa Biofuels,
which has been designated to grow up to
20 000 acres of switch grass. The project area will
surround an Abengoa biomass conversion plant in
Hugoton, Kan.
Agriculture Secretary Tom Vilsack also
announced projects in California, Montana,
Oregon and Washington for the production of
renewable energy crops to make ethanol or other
liquid biofuels
A release from the Agriculture Department
estimated that the projects would create more than
3400 jobs in agriculture, biofuels and related
sectors and provide the crops to produce more
than 2 mio gallons of biofuels annually when full
production was achieved.
(Continued in next column)
Kansas gets another biofuels project (Contd)
―The Obama Administration is committed to
providing financial opportunities to rural
communities, farmers and ranchers to produce
biomass which will be converted to renewable
fuels and increase America‘s energy
independence,‖ Vilsack in the release. ―The
selection of these project areas is another step in
the effort to assist the nation‘s advanced biofuel
industry produce energy in commercial quantities
from sustainable rural resources. This effort will
create jobs stimulate rural economies across the
nation.‖ (kansascity.com 26 July 2011)
Extension of ethanol tax credits would boost corn production
Extending federal ethanol tax credits would help
significantly boost corn production, a new study
from the University of Missouri finds. According
to a report released by MU's Food and
Agricultural Policy Research Institute,
indefinitely extending the 45-cent tax credit for
biofuel blenders and the associate 54-cent tariff
on ethanol imports would increase the domestic
production of ethanol from corn starch by
1.2 bio gallons/year. The increased fuel
production would use an additional 440 mio
bushels of corn.
Based on these findings, FAPRI predicts growing
area for corn would be expanded
by 1.7 mio acres, while soybean area would fall
by 800 000 acres. The ethanol tax credit and tariff
are set to expire at the end of the year
(Continued on next page)
June/July 2011 www.giract.com Page | 17
Starch Italics Starch Industry Overview
Bio-Fuels
Extension of ethanol tax credits would boost corn production (Contd)
Earlier this month, Missouri Senators
Claire McCaskill and Roy Blunt both voted
against a bill in the U.S. Senate that would have
brought an abrupt end to the ethanol tax credit.
Both senators said the system for subsidizing
biofuel blenders should be adjusted, but not
simply eliminated. (semissourian.com 28 June
2011)
Feature: Growing up and across
Ethanol is now a standard energy source in Brazil
and should be treated as such, meaning it must be
available 24 hours a day, 365 days a year.
It is also necessary to take the seasonal nature of
the feedstock (raw material) into account. This
demands both investments and control
mechanisms to ensure regular supplies
year-round.
The ethanol agenda has been discussed by
governments and business sectors with a focus on
expanding production and increasing supply to
meet Brazil‘s growing demand.
This growth is associated with years of work and
development on agricultural and industrial
technology beginning in 1975 when the Brazilian
government created its National Ethanol Program
(Proálcool).
Brazilian energy company Petrobras played a key
role in this process, providing a logistics and
marketing structure for ethanol and, more
recently, participating in production through the
2008 incorporation of a subsidiary dedicated
solely to biofuels, Petrobras Biocombustível.
(Continued in next column)
Feature: Growing up and across (Contd)
The company is associated with sugar and ethanol
production groups such as Guarani (state of São
Paulo), Nova Fronteira Bioenergia (State of
Goiás), and Total Agroindústria Canavieira (state
of Minas Gerais) and currently holds stakes in
10 ethanol production plants, ranking third in the
industry in Brazil.
The combined 2010 capacity of Petrobras
Biocombustível and its associated companies was
24.5 mio t of sugarcane crushing capacity,
942 mio litres of ethanol production capacity, and
517 GWh of electricity generated from sugarcane
bagasse. (biofuels-news.com 29 June 2011) Farmers, ethanol makers likely OK without subsidy
If a USD 5 bio/year federal subsidy that helped
build the ethanol industry comes to an end, it will
likely mean two things, experts who have
followed its development say. First, it doesn‘t
guarantee an end to the high prices that corn
farmers have enjoyed and livestock producers and
other food manufacturers have endured.
That‘s because of the second point: the ethanol
industry likely would be fine without the subsidy
and keep using just about as much corn as it has
the past few years.
As the experts point out, the 45cent/gallon tax
credit set to expire at the end of the year doesn‘t
even go directly to ethanol producers, but instead
has been an incentive for oil companies like BP,
Valero Energy Corporation., and ExxonMobil
Corporation — known in the ethanol industry as
blenders — to buy ethanol and blend it with
gasoline. And the tax credit isn‘t even the primary
driver of ethanol demand. That, economists note,
has been the federal requirement that the country
produce an increasing amount of renewable fuels
like ethanol. (Continued on next page)
June/July 2011 www.giract.com Page | 18
Starch Italics Starch Industry Overview
Bio-Fuels
Farmers, ethanol makers likely OK without subsidy (Contd) ―Bruce Babcock, an economist at Iowa State
University says ―The U.S. ethanol industry is very
competitive; they don‘t need the subsidy.‘‘
The U.S. Senate voted last week to end the tax
credit and an accompanying tariff on ethanol
imports in July, half a year ahead of schedule. The
move was mostly symbolic — Republicans
blocked the jobs bill it was part of — but it
showed that lawmakers may be ready to let the
subsidy die in December rather than renew it as
they did last year.
Ethanol producers and corn farmers had hoped to
preserve the tax credit, but now seem willing to
compromise.
Many in the ethanol industry now are pushing for
a smaller credit designed to encourage sales when
economic conditions dictate that ethanol
producers really need it, and money to pay for the
installation of gas pumps that would let drivers fill
up with fuel containing up to 85% ethanol--
Republican Sen, John Thune of South Dakota and
Democratic Sen.
Amy Klobuchar of Minnesota are sponsoring such
a compromise bill the industry favors. Both
senators are from states with thriving ethanol
industries.
―We think cooler heads will prevail and we‘ll get
something rational‘‘ from Congress, said Vincent
Kwasniewski, vice president of GTL Resources.
The company owns the Illinois River Energy
ethanol plant in Rochelle, Ill. ―We think we‘re in
a strong position to prosper under that kind of
legislative situation.‘‘
(Continued in next column)
Farmers, ethanol makers likely OK without subsidy (Contd)
The tax credit, known as Volumetric Ethanol
Excise Tax Credit, or VEETC, was created in
2004 to help encourage the use of ethanol, most of
which in the United States is made of corn.
It gave oil companies financial incentive to buy
ethanol and blend it with their gasoline — using
more of the alternative fuel — at a time when
there was little financial incentive to do so. The
credit and the renewable fuels mandate — a
requirement that refiners use 12 bio gallons of
renewable fuels in 2011, 15 bio by 2015 and
36 bio by 2022 — have worked together to drive
up ethanol production. The U.S. produced
13.2 bio gallons of ethanol in 2010, up from
3.4 bio in 2004, according to the
Washington-based Renewable Fuels Association.
Last year, it took about one-third of the U.S. corn
crop to meet the ethanol demand. When coupled
with increased orders from livestock producers,
who rely on corn for feed, and growing exports to
China and elsewhere, the demand for corn has
soared and caused prices to reach historic highs.
Given that, corn farmers aren‘t sure what to think
about the latest development. If demand remains
strong, prices should remain high, but they‘re
uneasy about a dramatic change in federal policy.
―I guess I was hoping there would be a more
orderly reduction. Maybe a phase-down,‘‘ said
Greg Bartz, who grows corn and soybeans near
the southern Minnesota community of Sleepy
Eye. Leon Sheets, who raises 1 200 hogs in
northeast Iowa, was among those who have had to
buy a lot of high-priced corn the past few years.
The president of the Iowa Pork Producers
Association has watched in disbelief as corn
prices rose, past USD 4 a bushel and on through
five and six.
(Continued on next page)
June/July 2011 www.giract.com Page | 19
Starch Italics Starch Industry Overview
Bio-Fuels
Farmers, ethanol makers likely OK without subsidy (Contd)
―All the sudden, geez, we jumped over seven and
crowded 8,‘‘ he said. ―It didn‘t necessarily mean
that I was losing (money), but my opportunity to
show a profit on the operation has been extremely
challenged.‘‘
Scott Irwin, the Chairman of Agricultural
Marketing at the University of Illinois, sees the
loss of the tax credit as ―moderately bad news‘‘
for farmers but a change that likely wouldn‘t
change prices much. Although Irwin said the
ethanol producers could manage without the tax
credit, he speculated that it would cut down on the
industry‘s growth potential. Without some sort of
subsidy or oil prices pushing USD 150 a barrel or
more, there‘s not much incentive right now for
anyone to use more ethanol than the mandate
requires.
That, some in the industry believe, is where the
new gas pumps come in. Chris Thorne,
spokesman for the trade group Growth Energy,
said that there are roughly 8 mio flex-fuel vehicles
on U.S roads now, but relatively few gas pumps
that sell gasoline blended with the higher levels of
ethanol they can burn. New Jersey, he said, has
about 186 000 flex fuel vehicles, but no flex-fuel
pumps.
―The (subsidy) did a great thing in building up
demand and encouraging production of ethanol,‘‘
Thorne said. ―Well, we don‘t have a production
problem anymore, we have a market access
problem.‘‘ (pantagraph.com 25 June 2011)
Cellulosic ethanol and cold fusion There was much scientific research and several
claims that it had been accomplished. The claims
were refuted and scientists moved on to other
areas that showed more promise or at least more
funding. (Continued in next column)
Cellulosic ethanol and cold fusion (Contd)
We are at a point where the claims that MOG
(material other than grain) can be made into fuel
grade ethanol must become reality or it will be
discarded like the miracle energy sources of the
past
Conversion of corn to fuel grade ethanol is about
2.8 gallons/bushel. It is a straightforward
mechanical and distillation process that has been
subsidized for more than a decade. In that time
period, the growth of the industry has been
astonishing. The dream of producing 10% of the
nation's fuel supply was eclipsed last year and the
subsidy and tariff will drop away at the end of this
month.
Congress will keep in place a subsidy for
cellulosic ethanol because it has yet to be able to
stand on its own. Claims that it can be made are
quickly followed by estimates that it costs four
times as much to produce. In fact, there are no
commercial scale production facilities that are
producing ethanol from cellulose. However, two
are in the final planning stages in Iowa.
One is in owned by Poet, the nation's largest
ethanol maker, and the other is owned by DuPont
and its subsidiary, Danisco, an enzyme maker
recently purchased by the industrial giant. Poet is
using grants and loans from the state and federal
government to build its 25 mio gallon plant and
DuPont is using its stockholder's money to
construct one of similar size.
Here is how far behind the cellulosic technology
is compared to corn-based ethanol: Conversion of
starch (corn) to ethanol rose from less than a bio
gallons in 2001 to 13 bio gallons in 2010.
Cellulosic ethanol was projected in 2007 to be at a
half bio gallons today. The EPA projection for
this year will only be 12 mio gallons. That is
either failure or a very slow start depending on
your point of view. (Continued on next page)
June/July 2011 www.giract.com Page | 20
Starch Italics Starch Industry Overview
Bio-Fuels
Cellulosic ethanol and cold fusion (Contd)
A researcher at Iowa State University says the
technology to turn corn into ethanol has been
known for a thousand years but the cellulosic
process is very recent.
I feel like they know that they can't make good on
their earlier claims but need more money to figure
out what they are going to do when they finally
admit it.
Poet is a company that is making corn-based
ethanol at a profit. Adding cellulosic seems to be
a source of pride or a required extension just in
case someone else gets the process flowing and
makes starch-based production obsolete.
DuPont is an innovative company with a long
track record of technology development.
It seems that they will use this plant to develop
and patent products and technologies that they can
sell to others and that they may be able to
coordinate in their seed division, Pioneer Hi-Bred
International, to breed and adapt crops for
biofuels production that also goes to their bottom
line.
Neither of these companies has to make this
technology work. They have their base of
operations and proving that it won't work may be
almost as positive as proving that it does.
It is unfortunate that a small, and somewhat
desperate, entrepreneur can't come into this field
and crack the code to make cheap ethanol from
low value cellulose.
One other area to watch as these two plants gear
up to produce (somewhere around 2013) is the
truck traffic.
(Continued in next column)
Cellulosic ethanol and cold fusion (Contd)
Hauling corn for a 100 mio gallon starch based
plant takes a lot of tonnage but hauling cellulose
for a facility just one quarter that size will take
many more loads along with storage and grinding
on a scale that far exceeds anything the industry
has attempted. Both of these plants will depend on
corn stover and will require cooperation from area
farmers who will have to decide whether to retain
material that traditionally goes back into the soil
to add nutrients and organic matter for the next
crop or to haul it to the processor for additional
cash. (hpj.com 15 July 2011)
Ethanol, soy demand drive up food prices
Supply strains caused by rising demand for
soybeans from China and corn for ethanol are
fueling the rapid rise in world food prices,
according to a study by Purdue University
economists. Greater biofuels consumption and
China‘s demand for oilseeds required 46.5 mio
acres of U.S. farmland in 2010, almost triple the
amount in 2005, the researchers said in a study
released in Washington, D.C. A weaker dollar
that‘s made U.S. exports more attractive, weather
disruptions and demand that has become less
responsive to supply disruptions have added to
price pressures, according to the report.
―The current tight-stocks period and relative high
prices are expected to continue for the next one to
two years,‖ the authors said in the study.
―Ultimately, the question is whether world
supplies can not only catch up with recent demand
increases, but keep pace with demand growth over
time.‖
Global food prices have soared 39% in the past
year, reaching a record in February, according to
U.N. data.
(Continued on next page)
June/July 2011 www.giract.com Page | 21
Starch Italics Starch Industry Overview
Bio-Fuels
Ethanol, soy demand drive up food prices (Contd)
The increased costs have contributed to the unrest
in northern Africa and the Middle East that
resulted in the overthrow of leaders in Tunisia and
Egypt. U.S. food expenses rose 3.7% in the 12
months through June, government data show.
During that period, rice, wheat, corn, soybean and
milk futures touched the highest levels since at
least 2008.
The report was released at a forum in Washington
sponsored by the Farm Foundation, the
Oak Brook, Ill.-based non-profit organization
dedicated to agricultural issues that commissioned
the study. The Purdue study, produced by Wallace
Tyner, Philip Abbott and Christopher Hurt, did
not assign proportions to how much each factor
was driving food prices. (journalgazette.net
24 July 2011)
Seaweed Could Be New Form of Biofuel
The slimy ocean strands that tangle onto your
body while swimming may have a new purpose.
Researchers are turning towards kelp and seaweed
as a viable fuel option in replacing biofuel made
from crops. The new form of biofuel would
provide a solution to alleviate over-farming and
protect freshwater sources. (Continued in next
column)
Seaweed Could Be New Form of Biofuel (Contd) Crops for biofuel have long been controversial
and opinions are siding more frequently with the
practice being a bad idea. Farming as a fuel
option puts stress on the land as scarcity of an
area competes for farming purposes. But, the
practice also raises already high commodity
prices, putting more of a strain on lower income
communities. According to a release by the
Association of American Physicians and Surgeons
(AAPS), ―U.S. and European policy to increase
the production of biofuel could lead to almost
200 000 deaths in poorer countries.‖ A staggering
statistic that proves a need for change goes
beyond the land.
Researches see great potential for kelp and
seaweed as a means for biofuel. The marine plant
grows in abundance, is not generally a food
source, doesn‘t need freshwater to grow and
doesn‘t take up land space, making it a
worthwhile solution to research. Just like crops,
the carbohydrates in seaweed tissue can be
converted into fuel. There are three ways
conversion can be accomplished: pyrolysis, which
is a process of burning to create oil, fermentation
with bacteria to create ethanol and through
anaerobic digestion which produces methane.
However, unlike crops, seaweed relies on water‘s
buoyancy, allowing the plant to skip lignin
production.
A woody compound that allows land plants to
stand up against gravity‘s pull, lignin resists
degradation, ―a key obstacle in bringing terrestrial
biofuels to the market.‖ Since seaweed doesn‘t
produce lignin, the plant can be more easily
converted to fuel. Teams working on the project
acknowledge that there are a few obstacles that
must be addressed. One such opposition is
cultivation over harvesting wild seaweed.
Harvesting from the wild would compromise
sustainability of the practice.
(Continued on next page)
June/July 2011 www.giract.com Page | 22
Starch Italics Starch Industry Overview
Bio-Fuels
Seaweed Could Be New Form of Biofuel (Contd)
Michele Stanley of the Scottish Association of
Marine Sciences, said cultivation of the sea plants
would be supported. Another factor is cost. At
this time, seaweed farming is not considered
economical. According to the Technical Research
Center on Seaweed in Pleubian, France, oil prices
would need to rise to at least USD 300 a barrel
before the practice could be considered feasible.
Timing could also produce some shortages.
Statistics found harvesting at different times of
the year effects carbohydrate levels. Kelp and
seaweed would need to be harvested in July, when
carbohydrate levels are at their highest, in order to
―ensure optimal sugar release for biofuel
production.‖
Despite problems that must be addressed,
researchers are already planning for the future of
biofuel. The current proposal is to grow kelp and
seaweed forests anchored by flexible material,
allowing the plants to naturally move with the
waves.
Norwegian company, Seaweed Energy Solutions
AS, has already developed a device for growing
kelp and seaweed on the ocean floor. The design
allows a single kelp sheet to be anchored in one
area, eliminating rope tangles other designs are
prone to. Founder of the company, Pal Bakken,
said the design allows for a simpler and cheaper
way of harvesting seaweed, and could make deep
water cultivation possible. (greenanswers.com
15 July 2011)
Ethanol Industry Torn Over Losing Subsidy Billions The federal government pays oil companies about
USD 6 bio a year to blend ethanol into your
gasoline; it's been subsidizing ethanol for 33 years
now. (Continued in next column)
Ethanol Industry Torn Over Losing Subsidy Billions (Contd)
But any agreement in Washington, D.C., to raise
the debt ceiling will most likely include a plan to
cut off that subsidy. And after all these years,
many in the ethanol industry say they don't really
care. The end of the subsidy — and the mixed
reaction to that idea — reveals how the world of
corn ethanol has changed dramatically.
Blending Ethanol With Gas
The fuel that's in your car or truck right now
didn't get to the gas station straight from the
refinery. It very likely stopped at a place like the
Magellan fuel terminal in Kansas City, Kan.,
where gasoline from a pipeline is blended with
ethanol.
"The ethanol all comes in here by truck," says Jeff
Myers, who runs the sprawling complex of
enormous white fuel tanks.
Pointing at a line of trucks nearby, he says,
"They're full of ethanol. So, they're waiting to pull
in under this bay, where they will unload the
ethanol. The other trucks in line, over here, they're
waiting to load fuel."
Myers says ethanol and gas are mixed in the
trucks' cargo tanks, earning whoever owns the
fuel a "blending credit" worth 45 cents for every
gallon of ethanol.
A New Position On Losing Subsidy
Until recently, the ethanol industry said it would
wither without this subsidy. Bob Dinneen,
President of the Renewable Fuels Association,
made this argument in an interview with the
Domestic Fuel podcast less than a year and a half
ago.
"If you do not extend the tax incentive, we're
going to lose 112000 jobs across all sectors of the
economy," he said back then.
(Continued on next page)
June/July 2011 www.giract.com Page | 23
Starch Italics Starch Industry Overview
Bio-Fuels
Ethanol Industry Torn Over Losing Subsidy Billions (Contd)
When asked if the industry needs that same tax
credit now, Dinneen said, "No, you don't. In
today's environment, no, you don't need it."
But people like Tom Buis, with Growth Energy,
the other main ethanol group, say the tax credit
has been vital to helping ethanol get off the
ground.
"The industry wouldn't have happened without it,"
Buis says, "but we're in a different position
today."
There are at least three reasons behind the change.
The first is regulatory: The government forces oil
companies to use ethanol. And that mandate is
growing. Next year, it will call for more ethanol
than the industry produced this year.
That government mandate renders the tax credit
irrelevant, says Bruce Babcock of Iowa State
University.
"You can see that that growing mandate really is
the thing that's going to drive ethanol demand," he
says, "and the USD 6 bio that we are spending
really isn't going to accomplish anything."
High oil prices are another reason ethanol
producers are sanguine about the tax credit
ending. Corn ethanol is currently cheaper to
produce than gasoline. It's also quite a bit cheaper
than imported ethanol, most of it made from sugar
cane. The third reason Babcock cites is something
some folks might call sour grapes.
"They've never been so politically vulnerable as
they are right now," he says. "They're used to
winning these battles for subsidy. And they put a
great deal of political weight and effort into
maintaining this tax credit, and they lost."
(Continued in next column)
Ethanol Industry Torn Over Losing Subsidy Billions (Contd)
Momentum To Cut Subsidy
In June, the Senate voted overwhelmingly to end
the USD 6 bio ethanol subsidy. The move was
"definitely long overdue," says Sheila Karpf of
the Environmental Working Group.
"We think of it as a college kid that needs to move
out of their parents' basement, or even a
50-year-old that needs to move out of their
parents' basement," she says.
A tariff on imported ethanol will die with the
subsidy. But that's not likely to stop ethanol
production from using about 40% of all the corn
grown in the United States. And the next
battleground, Karpf says, will be over cutting the
mandate to use ethanol. "There are talks right now
about trying to reduce the corn ethanol mandate,"
she says, "since it is pushing up the price of feed
and food."
But the ethanol mandate has a lot more friends
than the subsidy did — and it's not likely to
change anytime soon.
The ethanol industry's more immediate problem is
finding some way to sell all of the fuel it can
produce. That would mean going above the 10%
now found in most gasoline.
Gas stations, like one in Lee's Summit, Mo., could
be part of the solution. Here, customers can buy a
range of fuel blends — 85t ethanol is a popular
one. Thanks largely to the tax credit, it's much
cheaper than normal gas. But patrons also say
they appreciate that it helps farmers and is not
made with imported oil.
Michael Riely pulls up in a Japanese sports car
with a big hood scoop and starts filling up at the
pump.
(Continued on next page)
June/July 2011 www.giract.com Page | 24
Starch Italics Starch Industry Overview
Bio-Fuels
Ethanol Industry Torn Over Losing Subsidy Billions (Contd)
"For me, it's either this gas, or I have to run race
fuel. And race fuel runs at least 8 bucks a gallon,"
Riely says. "So, I'm paying USD 2.99 for this,
versus the same quality fuel, I have to pay USD 8
if I want regular gasoline for this car."
So, 33 years of federal subsidies have helped to
build a large U.S. corn ethanol industry. And
mandates aside, most people who run it say it's
ready to stand on its own. (npr.org 21 July 2011)
Valley plants plan to make corn-free ethanol
With corn prices up and demand rising, work is
under way in the Valley to develop two
biorefineries to make ethanol without using the
golden grain.
In Visalia, fast-growing grasses and cornstalks
could be the fuel of the future. EdeniQ, a local
biofuel technology company, and Virginia-based
Logos Technologies are building a plant to
demonstrate the commercial promise of fibrous
and woody materials.
On the Valley's west side, it's all about sugar
beets. Engineers are drawing up plans for a plant
near Mendota to distill ethanol from sugar beets,
and to make methane and electricity from farm
waste. Both efforts are attracting attention -- and
money - from federal and state agencies eager to
boost alternative fuel production.
In late 2009, the U.S. Department of Agriculture
and the Department of Energy jointly awarded
EdeniQ and Logos a grant for more than
USD 20.4 mio to help pay for the Visalia project.
It was one of 19 plants across the country to
receive more than USD 600 mio from the
Biorefinery Assistance Program.
(Continued in next column)
Valley plants plan to make corn-free ethanol (Contd)
The Mendota Advanced Bioenergy Beet
Cooperative received a USD 1.5 mio grant from
the California Energy Commission last year to
test the viability of using sugar beets, as well as
farm waste such as almond-orchard prunings, to
produce fuel and energy. It was one of six grants
awarded at that time to promote biofuel
production.
Old fuel, new sources
Ethanol is typically made by grinding up grains
such as corn or sorghum; the starches and sugars
locked inside the grain are then fermented with
yeast to produce alcohol, which can be used as a
fuel additive.
Ethanol production isn't new to the Valley. Pacific
Ethanol has plants that use corn in Madera and
Stockton. Altra Biofuels has such a plant in
Goshen, near Visalia.
But the government is now encouraging
companies to find and improve ways of making
"cellulosic ethanol" from tough, inedible grasses
and the woody or pulpy waste from fields and
orchards.
"We need all the energy we can get our hands on
in this country," said Brian Thome, EdeniQ's
president and CEO. "And while there will be a
little more growth in corn ethanol ... the next big
jump will be from other sources, other materials,
and that's where cellulosic comes in."
EdeniQ has operated a small-batch pilot plant for
several years in Visalia to use switchgrass, corn
stalks and cobs, and other types of vegetation. The
company is trying to show that its proprietary
technology and processes can be profitable on an
industrial scale.
(Continued on next page)
June/July 2011 www.giract.com Page | 25
Starch Italics Starch Industry Overview
Bio-Fuels
Valley plants plan to make corn-free ethanol (Contd)
The company broke ground on its USD 25 mio
demonstration plant last month and expects to
finish construction by the end of this year. After it
is operational in early 2012, the facility will chew
up about two tons per day of tough grasses, wood
prunings and field waste, and spit out between
40 000 and 50 000 gallons of ethanol a year.
Cranking out ethanol isn't all that difficult.
"People have been making alcohol for thousands
of years," said Thome. "That's all we're doing. It's
a big distillery."
But compared to corn, it's much tougher to coax
sugars and starches out of high-cellulose
vegetation such as grass and wood.
Thome said the technology also could allow
existing corn ethanol plants to increase production
using less corn, or to become more versatile by
adding cellulose to the materials used to run the
plant.
Thome said that could help producers level out
the swings in corn prices and transportation prices
-- spikes that dented the profitability of ethanol
producers in recent years
As for the Mendota project, the state grant means
progress for basic design and engineering work of
the sugar beet biorefinery, said John Diener,
President of the Mendota Advanced Bioenergy
Beet Cooperative.
(Continued in next column)
Valley plants plan to make corn-free ethanol (Contd)
The cooperative proposes to grind 840kt of sugar
beets and 80kt of almond prunings and other
plentiful farm waste. In addition to distilling about
33.5 mio gallons of ethanol, a bio-mass line
would burn wood waste to generate
6.3 megawatts of electricity, and waste pulp from
the beets and other material would be processed to
produce 1.6 mio cubic feet of biomethane to make
compressed natural gas.
The project could fuel a renaissance for sugar
beets as a cash crop in western Fresno County,
said Diener. Sugar beets were once a thriving
commodity in the area, but acreages shrank
throughout the 1990s as farmers shifted to more
profitable crops. That eventually prompted the
Spreckles Sugar Co. to close its beet processing
plant in Mendota in 2008.
But development is moving more slowly than
backers had hoped. When the energy commission
awarded the grant in December, construction was
expected to begin in late 2011 with operations
commencing in late 2012. (fresnobee.com 19 June
2011)
BP Biofuels confirms 2012 groundbreaking for US cellulosic ethanol project
In Louisiana, BP Biofuels Americas President
Sue Ellerbusch said that the company‘s 36 mio
gallon Highlands County (Florida) cellulosic
ethanol project will break ground ―early next
year‖ and will open in 2013. ―Total investment in
the facility and agricultural feedstock operation
will be in excess of USD 400 mio,‖ she noted,
adding that the project will be based on a
20 000 acre feedstock farm, and that ―experience
has shown us that future cellulosic biofuels
facilities will take four to five years from land
acquisition to production of first ethanol.‖
(Continued on next page)
June/July 2011 www.giract.com Page | 26
Starch Italics Starch Industry Overview
Bio-Fuels
BP Biofuels confirms 2012 groundbreaking for US cellulosic ethanol project (Contd)
Ellerbusch outlined BP‘s four criteria for
advantaged biofuels:
―First, biofuels must be low-cost. Our benchmark
for success is USD 1 a gallon, so that the biofuels
we make can compete with oil without any
subsidy by 2022. Second, biofuels must be
low carbon. We anticipate producing biofuels in
the U.S. that meet the national goals of reducing
the GHG levels in transport fuels by over 60%
from current levels. Third, biofuels must be
scalable. There is no point in making boutique
biofuels. Only mass production and mass
distribution can turn the dial. Lastly, biofuels
must be sustainable. Sustainable from an
environmental, social and economic perspective.‖
(biofuelsdigest.com 24 June 2011)
AE Biofuels acquires Zymetis for renewable fuels, chemicals
AE Biofuels Inc. said it completed an acquisition
of Zymetis Inc., an industrial biotechnology firm
developing products for the renewable chemicals
and advanced fuels sectors.
The Cupertino-based advanced biofuels company
(OTC:AEBF) issued 667 3555 common shares to
Zymetis shareholders under the transaction, with
766 000 of the shares vesting over three years.
The nearly 100-employee company operates a
55 mio gallon ethanol plant in California and
received a USD 1.8 mio grant from the California
Energy Commission grant in April to accelerate
commercial implementation of its enzyme-based,
cellulosic ethanol production technology.
(Continued in next column)
AE Biofuels acquires Zymetis for renewable fuels, chemicals (Contd)
Maryland-based Zymetis is expected to operate as
a subsidiary of AE Biofuels.
Zymetis has patents and patents pending on the
Z microbe — a marine organism that consumes
plant cellulose.
The microbe naturally generates enzymes that
convert sugar, starch, and cellulose into useable
chemicals and fuels.
―Zymetis‘ technology has already demonstrated
the production of high-value chemicals to supply
multi-billion-dollar global markets, but we lacked
a commercialization platform,‖ said Zymetis
founder Dr. Steve Hutcheson in a prepared
statement. Hutcheson is expected to join
AE Biofuels‘ board of directors.
―The combination of AE Biofuels and Zymetis
enables the launch of new specialty chemical and
renewable fuels products at an accelerated rate
compared to the normal product development and
construction cycle of three years or more,‖ said
AE Biofuels CEO Eric McAfee, in the statement.
(bizjournals.com 06 July 2011)
Biofuels firm wins verdict over Colwich ethanol site
Abengoa Bioenergy is still eyeing a new ethanol
plant next to its existing one in Colwich as it
works through a series of stiff legal and economic
challenges.
Last week, a jury in St. Louis County, Mo.,
awarded Abengoa USD 48.4 mio for what it
decided was a 2006 mistake by Chicago Title
Insurance Co. that caused Abengoa to build in
Illinois rather than Kansas.
(Continued on next page)
June/July 2011 www.giract.com Page | 27
Starch Italics Starch Industry Overview
Bio-Fuels
Bio-Plastics
Biofuels firm wins verdict over Colwich ethanol site (Contd) Abengoa was seeking a rezoning for a plant site in
Colwich. The company hired Chicago Title to
research all the property owners legally required
to be notified for a rezoning by the city of
Colwich.
But Abengoa said in the suit that Chicago Title
left seven property owners off the list. Some of
the property owners used the mistake to challenge
the rezoning. That case was settled in favor of the
city in April, said Abengoa attorney Grant Davis,
when the Kansas Supreme Court elected not to
hear the case and let stand an earlier decision by
the Kansas Court of Appeals.
Because of the lengthy court case over the
rezoning, Abengoa built the plant in Granite City,
Ill., rather than Colwich. The decision cost
Abengoa USD 48.4 mio, Davis said, because a
plant in Colwich would have opened sooner and
been less expensive to operate. Chris Standlee,
executive vice president for Abengoa Bioenergy
U.S. Holding Co., said the company still likes the
Colwich site.
The company had planned to build a plant that
would produce up to 100 mio gallons of ethanol a
year and employ 78 people. But, Standlee said,
the company has no immediate plans to build. The
financial and ethanol markets have changed
dramatically since 2006 when demand for ethanol
was growing and financing was easy.( kansas.com
19 July 2011)
Corn ethanol subsidy to end
Last week, a bi-partisan coalition of senators
stunned ethanol producers with a 73-27 vote to
halt the 45 cents/gallon tax credit — billions of
dollars per year that have gone to producers of
blended ethanol.
(Continued in next column)
Corn ethanol subsidy to end (Contd)
That vote won't affect the two ethanol plants
planning to locate in Highlands County, BP's
Vercipia plant near Brighton, and Highlands
EnviroFuels, south of Lake Placid.
In Louisiana, BP Biofuels Americas president Sue
Ellerbusch said that the company's 36-mio-gallon
cellulosic ethanol project will break ground "early
next year" and will open in 2013.
"Any vote by Congress to eliminate the
Volumetric Ethanol Excise Tax Credit," the
ethanol blender's credit, "will not affect our
proposed ethanol plant in Highlands County," said
Bradley Krohn, president of U.S. EnviroFuels.
"Our business model is stand-alone and does not
require any government subsidies, tax credits, or
funding."
BP spokesman Tom Mueller agreed: "Congress
has not shown any indication that it is interested
in eliminating the production tax credit for
cellulosic biofuels." (highlandstoday.com
27 June 2011)
Plastic by Any Other Name
But despite all the buzz, Coca-Cola and PepsiCo's
plant-based bottles are still very much plastic. The
companies have merely replaced the fossil fuels
(petroleum and natural gas) traditionally used to
make their plastic bottles with ethanol from
renewable sources (plant waste in Pepsi's case and
Brazilian sugar cane in Coke's). (Continued on
next page)
June/July 2011 www.giract.com Page | 28
Starch Italics Starch Industry Overview
Bio-Plastics
Plastic by Any Other Name (Contd)
Though these initial inputs come from renewable,
lower-carbon sources, the resulting plastics are
chemically identical to the polyethylene
terepthalate, or PET, and high-density
polyethylene, or HDPE, that regular plastic bottles
are made of—a fact the companies acknowledge.
And once the inputs become plastic, they carry all
the same environmental impacts as plastic made
from fossil fuels: They don't biodegrade, they
pollute the world's oceans and soils, and still leach
potentially harmful chemicals into our food.
"They're just using plants to make the same
polymers you find in other plastics. It has zero
effect on plastic pollution," says Marcus Eriksen,
a marine expert who co-founded the nonprofit
5 Gyres a few years ago to study ocean
plasticization in areas like the Great Pacific
Garbage Patch.
Eriksen and his crew just finished exploring the
world's five major oceanic gyres (slow-moving
currents that create massive whirlpools where
plastic can accumulate). They've found "plastic
soup"—water thick with tiny bits of plastic—in
all five.
(Continued in next column)
Plastic by Any Other Name (Contd)
Eriksen's team and other researchers have also
found larger chunks of plastic on the various
islands scattered throughout the gyres, and in the
bellies of dead birds, fish, and animals who fill
themselves up with plastic bits that they mistake
for fish and eventually die because they can't
digest the stuff.
Likewise, plastic—plant-based or otherwise—
harms human health
The dangers of chemical additives commonly
used in plastic, such as BHT,* as well as chemical
compounds released by plastics, such as
acetaldehyde have been widely publicized for
their apparent link to various types of cancer.
"Some bioplastics formulations use the same
types of additives as petroleum or natural
gas-based plastics," acknowledges Melissa
Hockstad, a vice president at SPI, a trade
association for the industry. In other words, plant
plastics are not necessarily free of harmful
chemicals.
There's no way to know whether a particular
plant-based plastic bottle includes these
chemicals, since all plastic "recipes" are protected
as trade secrets. But since traditional PET and
HDPE manufacturers tend to use them to produce
the right level of pliability and clarity, there's a
very good chance that plant-based versions of
PET and HDPE contain them, too.
Hockstad says "some companies have been
working on the development of bio-based"
alternatives. But the key phrase is "working on the
development of," as in, those additives don't exist
yet and may never. That said, there's a kernel of
real progress amid the plant-plastic hype. The new
bottles reduce the use of fossil fuels and improve
recyclability. But there's a big difference between
"recyclable" and "recycled."
(Continued on next page)
June/July 2011 www.giract.com Page | 29
Starch Italics Starch Industry Overview
Bio-Plastics
Plastic by Any Other Name (Contd)
While all bioplastics are technically "recyclable,"
current recycling systems are not set up to recycle
those that don't mimic existing plastics. The most
common bioplastics include polylactic acid,
which is made from corn starch, tapioca, or sugar
cane. When these bioplastics arrive at a recycling
center, they are separated out as waste.
In this sense, Coke and Pepsi opting to create
plant-based HDPE and PET instead of other
bioplastics is applaudable. Unfortunately, people
still recycle only a small fraction of the plastic
bottles they use, regardless of how those bottles
are made.
(Manufacturers typically put the recycling rate for
PET at 27%, while recycling advocates suggest
it's more like 21%.) Most plant-based bottles,
sadly, will end up in landfills or along the side of
the road.
As such, it's crucial not to misread plant-based as
biodegradable. "As a recycler, I'm much happier
with the bioresins that we're able to recycle, but I
don't want it to turn into something where people
think because they're buying a plant bottle, they
can be wasteful," says Gerry Fishbeck, Vice
President of the United Resource Recovery
Corporation, a large recycling company that has a
partnership with Coca-Cola. Pepsi and Coke could do a greater environmental
good by focusing on recycling instead of on
making plant-based bottles. They could, for
instance, finally throw their support behind bottle
bills, state legislation that creates a deposit system
for beverage containers. In the 10 states where
they're enacted, bottle recycling rates range from
60% to 80%, dramatically higher than the national
average.
(Continued in next column)
Plastic by Any Other Name (Contd)
But so far Coca-Cola and Pepsihave balked at
bottle bills, claiming they create an unreasonable
business cost. (Under the bills, manufacturers are
required to set up the deposit systems as well as
arrange for the collection and processing of their
empty containers.)
They should also commit to using recycled
material in their packaging. In 2001, Coca-Cola
pledged to use 10% recycled plastic in their PET
bottles by 2005. It achieved that goal, promptly
dropped its commitment to using recycled
content, and now evades precise accounting with
statements like, "We are working to advance
technologies that allow us to use greater amounts
of recycled materials in our packaging."
The bottles currently produced by major bottling
companies use about 4% recycled content,
according to Susan Collins, executive director of
the Container Recycling Institute.
There's no question that setting up collection
facilities and integrating recycled material into the
production stream is expensive. But several
companies are already doing it, Collins says.
Naked Juice, Naya Water, Eldorado Water, and
Rainbow Light Nutritional Systems, for example,
are all using 100% recycled plastic in their
bottles. Meanwhile, Coke and Pepsi are spending
mio on a plant-based version of the same old
packaging and touting it as an environmental leap
forward. Don't be fooled: It's a sidestep at best.
(slate.com 14 June 2011)
Bio-plastic plant for JK grounded
Despite passing of two years, the Jammu and
Kashmir Government has failed to start work on
an ambitious project to manufacture bio-plastic
from organic material as an alternative for
polythene.
(Continued on next page)
June/July 2011 www.giract.com Page | 30
Starch Italics Starch Industry Overview
Bio-Plastics
Bio-plastic plant for JK grounded (Contd)
The JK Agro Industries Corporation Ltd had
signed a Memorandum of Understanding (MOU)
with an Italian Company Earthsoul Pvt. Ltd., on
August 4, 2009 to construct state-of-the-art plant
in Jammu for manufacturing the bio-plastic.
By virtue of the MoU, the mega plant estimated at
a cost of INR 5 crore, was to be set up at
Bari Brahmana. Having 60% share in the project,
the plant was to be developed, operated and
maintained by the Italian firm.
The plant had the capacity to produce 70 t of
bio-plastic from the Maize, Corn and Potato
starch, to replace the plastic based products.
Officials said all the technical assistance and
imported machinery was to be installed by the
Italian Company. However, despite passing of
two years, the project is yet to take off. Sources
said that the plant has been ―sabotaged‖ by a
lobby working at the instance of some politicians
and industrialists nexus who control the plastic
manufacturing sector in the State.
―The project has been derailed before its take off
as it harmed the interests of the big industrialists
dealing with polythene‖, said a senior bureaucrat
wishing anonymity. A senior official of the State
Agro Industries Corporation Ltd, however blamed
the Italian company for the delay.
―The company has not yet started the work on the
project without assigning any reasons,‖ he said.
However, highly places sources said that the
Government has deliberately put the project on
backburner. ―Manufacture of bio-plastics would
have drastically affected the plastic industry and
the people associated with it as their crores of
rupees are at stake‖ they said.
(Continued in next column)
Bio-plastic plant for JK grounded (Contd)
Pertinently, the High Court had banned the use of
polythene in Jammu and Kashmir a few years
ago. According to estimates 70% of the garbage
consists of plastic bags which choke the drains.
Experts said the bio-plastic can check further
deterioration of State‘s fragile eco-system.
―The bio-plastic products degrade in six months.
They gradually dissolve in soil and water without
leaving any toxic effect‖ they said.
Sources said that State Government had received
advance orders for bio-plastics from various
departments, NGOs and other agencies,
When contacted the Officiating Managing
Director JK Agro Industries Farooq Ahmad,
acknowledged delay in execution of the project.
―There has not been any substantial progress in
the project. I will soon identify reasons for the
delay so that work on the project starts,‖ he said.
(greaterkashmir.com 03 July 2011)
June/July 2011 www.giract.com Page | 31
Starch Italics Starch Industry Overview
Regional Language News
These are the news derived from regional
publications, translated using online tools,
hence the medium quality of translation.
China
The current dynamic market conditions Shandong corn
Dynamics of Corn market in Shangdong province
On June 20, the purchasing price of
Zhucheng,Xinmao, a corn deep processing
enterprise in Zhucheng of Shangdong province, is
RMB380/t up by RMB 10/t.
The purchasing price of corn of 14% moisture
content of Zhucheng Runsheng is RMB 2380/t.
On June 20, the purchasing price of
Shengtaiyaoye, a corn deep processing enterprise
in Lechang area of Shandong province, is
RMB 2 400/t, up by RMB 16/t, the purchasing
price of Yingxuan brewery with tax is
RMB 2 420, On June 20, the purchasing price of
Hengren, one corn deep processing enterprise in
Tengzhou area of Shangdong province, is
RMB 2 340, discount is 1.
On June 20, the purchasing price of Jinyumi, one
corn deep processing enterprise in Shouguang
area of Shangdong province, is RMB 2388/t,
down by RMB 10/t, the purchasing price of
Xinfengdianfen of corn of 14% moisture content
is RMB 2 384, down by RMB 8/t.
On June 20, the corn purchasing price is
RMB 2330/t in Zouping area of Shangdong
province. On June 20, the purchasing price of
medium quality of corn, produced from Dongbei
area, is RMB 2300t, in Qingdao area of
Shangdong province. (zglyfzw.com 24 June 2011)
Gansu Dingxi report on the development of the potato industry The development of market mechanism and the
implementation of brand strategy have been paid
off. Citywide, we have put in place four potato
wholesale markets in Lintao Kangjiaya, Longxi
Wenfeng, Anding Lujiagou, Minxian Meichuan,
of which, Lintao kangjiaya is identified as a major
national potato market by the Ministry of
Agriculture.
As a result, we have established a farm produce
wholesale and purchasing network, with the top
four markets at the core, supported by small and
medium-sized markets and open fairs, relied on
purchasing and transport units, and based on
purchasing stations.
In 2004, 1.1 mio t of potato in our city were
exported, among which, railway system exported
6006 railway carriages, or 360kt and organized 6
special trains/15 600 t of potato.
Thanks to the active market regulation by the
government, last year, the price of exported potato
witnessed a net increase of RMB 80t on average,
the purchasing price of processing enterprises in
the city was raised by RMB 30/t, effectively
adding to farmers‘ income.
(Continued on next page)
June/July 2011 www.giract.com Page | 32
Starch Italics Starch Industry Overview
Regional Language News
Gansu Dingxi report on the development of the potato industry (Contd) By now, we have developed, reviewed and
released 5 Gansu standards concerning
pollution free potato and registered 10 potato
brands. ―Weiyuan Potato‖ has obtained the
registration of geo indication of country of origin
by the General Administration of Quality
Supervision, Inspection and Quarantine.
―Lintao Potato‖ has won national Grade-A Green
Food Certificate and Anding Chaoxing Refined
Starch is applying for National Grade-A Green
Food Certificate. Lintao Tengsheng, Xingda,
Gansu Jindadi, Minxian Jindadi and Longxi
Qingji Companies are accredited as major
industry leaders in agriculture industrialization in
Gansu Province, of which, Lintao Tengsheng
Company is listed as a national level major
industry leader in agriculture industrialization.
Anding and Weiyuan are named as ―Hometown
of Chinese Potato‖ and ―Hometown of Chinese
Potato Fine Breed‖ by the Organizing Committee
of Hometown of Chinese Specialties respectively.
We have witnessed certain progress in the
development of the potato industry this year, but
due to many subjective and objective factors, we
are still faced with many difficulties and
challenges as follows:
To begin with, the replication and application rate
of fine special purpose strains is relatively low
and the production of detoxification potato seed is
struggling with capital shortage. Terminal market
research we carried out last year and the
production practice of refined starch in recent
years demonstrate that the replication and
popularization rate of fine strains suitable for
export is low, such as Xindaping,
(Continued in next column)
Gansu Dingxi report on the development of the potato industry (Contd)
D-1533, Feiwu Ruita; the application range of
imported strains which are suitable for processing
chips and whole powder is rather limited, such as
the Atlantic Ocean and Sheopody; Longshu No. 3
fit for fine starch production is in low
industrialization scale; at the same time, these
main planting strains, Longshu No. 3 and
Xindaping in particular, are in the grip of capital
scarcity in the expansion and multiplication links,
which leads to lower application rate of
detoxification potato seed and severe
degeneration of field strains.
Secondly, the production bases are from being
standardized, customized and scientific with small
fine varieties and large orders. Specifically, due to
the mixed varieties used for processing and
export, the quality of raw materials is unstable
and the quality of exported products is low, which
means small room for price increase.
Meanwhile, the scientific content of the bases is
rather low and with low level of input, the unit
yield level leaves room for further improvement;
the demand rate of most raw material orders is
poor; due to the constraint of capital in
mechanized production technology, the machine
availability is insufficient and the promotion scale
is limited.
Thirdly, the working capability and actual
production form a stark contrast and moreover,
the output and quality are far from being stable,
fine and further processing needs to be further
elevated. Last year, 22 fine starch enterprises
developed 250kt processing capacity, but they
only produced 100kt, largely as a result of short
processing time and insufficient stock and supply
of raw materials; in the meantime, mixed varieties
of raw materials and unstable quality triggered
diverse and poor quality of fine starch.
(Continued on next page)
June/July 2011 www.giract.com Page | 33
Starch Italics Starch Industry Overview
Regional Language News
Gansu Dingxi report on the development of the potato industry (Contd) II. Next steps and priorities
The municipal agricultural bureau, as the leading
unit, will pay attention to the following works in
the coming six months while centering around the
targets and priorities for potato industrial
development defined by the municipal
government earlier this year:
To do a good job in field management to prevent
and treat the late blight of potato. We are expected
to host a prevention and treatment spot meeting
recently, provide technical training, organize and
ship pesticides and equipment and enhance
technical guidance. Meanwhile, we need to focus
on intertillage earth up, weeding and topdressing
as a way to contribute to high yield of potato.
To work to make orders possible. We will
mobilize leading enterprises to improve order
contracts and increase the contract fulfillment
rate. Meanwhile, we work to replicate the order
stock mode of Anding Chaoxing by combining
the development of depot system.
To make every endeavor to increase processing
quantity and product quality. Firstly, we will
encourage processing enterprises to speed up
technical transformation and expansion, overhaul
equipment in advance, and improve technologies
and techniques as well as expand processing and
improve quality. Second, we work to accelerate
the schedule of newly-added processing projects
to make them up and running as soon as possible.
Third, we will coordinate financial departments to
help processing companies apply for loans as a
way to ensure the availability of purchasing
capital. Fourth, we will stimulate processing
enterprises to promote order stocks.
(Continued in next column)
Gansu Dingxi report on the development of the potato industry (Contd) Fifth, we will invite potato processing experts
from the Netherlands to hold a seminar in
September to provide training for staffs working
at potato processing enterprises.
To do more to market potato. The total potato
output in our city this year is expected to amount
to more than 5.5 mio t. Apart from processing and
stock, more than 1 mio t will be exported. In this
connection, the export work is faced with new and
severe challenges.
For that end, we will, firstly, open green passage
in the city to ensure smooth traffic flow from
July 1 to late December according to the
requirement of the provincial department; second,
we will contact the railway department at an early
stage to compete for railway carriages.
We will continue to replicate the method of
railway and land transport and forming joint
transport office we used last year to dispatch and
allocate railway capacity. Our goal is to use
10 000 railway carriages and 10 large and special
trains for potato export; third, we will coordinate
with financial departments to make working
capital accessible to leading transport units and
associations; fourth, we will suggest provincial
agricultural department to make the potato fair to
be held in Dingxi this year a provincial meeting
which will be organized by the provincial and
municipal departments.bn (jastkj.com 02 June
2011)
Corn prices of Hebei province on June 10, 2011
On June 10, the price of corn increase slightly in
Xingtai area of Hebei province.
(Continued on next page)
June/July 2011 www.giract.com Page | 34
Starch Italics Starch Industry Overview
Regional Language News
Corn prices of Hebei province on June 10, 2011 (Contd)
News form Hebei Xingtai area The purchasing
price of corn of trader in Xingtai area is
RMB 2180/t, ex-works price is RMB 2 200/t, is
higher than prior period. As of stock is limited,
the market is defined by appropriate price yet no
transactions, but majority of deep processing
enterprises have signed the contacts with local
granaries.
On June 10, the corn purchasing price of 14%
moisture content of Renqiu Granary of Cangzhou
city in Hebei province is RMB 2 200/t but the
corn have not been processed On June 10, the
purchasing price of corn of 14% moisture content
of vendors in Handan cixian of Hebei province is
RMB 2 160/t, the corn has been processed. The
purchasing price of corn of 13% moisture content
of Handan guantaoxian in Hebei province is
RMB 2 220t, at present the corn price remain
stable.
On June 10, the purchasing price of corn of
Xiwangsiliao of luquan city of Hebei province is
RMB 2 180/t, the corn has been processed,
moisture content is 14%. The corn purchasing
price of 14% moisture content of Deruidianfen of
Xinji city in Hebei province is RMB 2 220/t. The
purchasing price for bulk buying in Shijiazhuang
city of Hebei province is RMB 2 200/t, the corn
has been processed and the moisture content is
14%.
On June 20, the corn purchasing price increased
slightly. And the latest news from one trader of
Hebei langfang that the purchasing price of corn
is RMB 2 200/t, is a little increase than previous.
Because the stock is limited, the purchasing price
is slightly higher. (aptc.cn 10 June 2011)
Starch Sugar prices to settle and general sales in June 17 2011
The upstream raw material:
This week intervals to discuss a little corn starch
market moving up, traders appear intent of getting
goods cheap, but the overall trading volume is
limited, with most still get-go based. As of Friday
(6.17), the mainstream range of uplift in the range
of around RMB 20-75/t range. Reference range in
the RMB 3150-3250/t East China, high-end
market continued to hold up to RMB 3 300/t in
the vicinity, and more to the downstream. South
China Resources in 3200-3250/t, slightly higher
RMB 50/t, part of the implementation of large
customer orders. Other North area or different,
reference to RMB 50-75/t; Northeast slight
RMB 20-30/t lift, but there is still the high initial
price of the manufacturers to maintain the original
price, watching the market.
The sugar areas: This week sales areas outside the spot price of
sugar by the strong support, showing a steady
firmer trend, the current stock market trend has
dominated this week, more rain because the
Yangtze River region, Shandong Province has
now entered the wheat harvest, the market
Guangxi Sugar reluctant to sell the more serious,
the amount of sugar in Yunnan began to slowly
decrease in overall sales volume is not ideal,
inventory is very weak, most of the downstream
sugar companies are now taken with, the market
outlook stay on the sidelines, despite spending a
few days ago has entered the peak season, The
reservoir will gradually throw sugar
normalization, but the dominance of spot prices
are still determined by the large domestic sugar
mills, sugar prices will remain strong in the case
of Fortune is expected to post price or the spot
will show a steady trend firmer.
(Continued on next page)
June/July 2011 www.giract.com Page | 35
Starch Italics Starch Industry Overview
Regional Language News
Starch, sugar prices to settle and sales in general June 17, 2011 (Contd) The price list:
Region Product Price (RMB
/ton)
Zouping region Crystalline
glucose
4100
Maltodextrin 3950
Texas Dingli Jujube
Industry
Crystalline
glucose
4150
Luzhou Bio-Chem
Technology
Crystalline
glucose
4200
75% maltose 2950
Fructose syrup
F42
3300
Fructose syrup
F55
4000
Zhucheng
Dongxiao
Crystalline
glucose
4300
75% maltose 2950
Maltodextrin 4400
Qingyuan Group 75% maltose 2920
Maltodextrin 4000
Qingzhou Huakang Crystalline
glucose
4100
Weifang Shengtai Crystalline
glucose
4300
Shandong Dezhou
in the Valley
Liquid glucose 3050
Into force the earth 75% maltose 2850
Tianli
Pharmaceutical
Sorbitol
pharmaceutical
grade
4300
(Continued in next column)
Starch, sugar prices to settle and sales in general June 17, 2011 (Contd)
Region Product Price
(RMB
/ton)
Sorbitol 3900
Hebei Jianmin
starch sugar
Crystalline glucose 4150
Qinhuangdao
Hua Li
Crystalline glucose 4200
Henan dragon Crystalline glucose 4150
Henan
Mengzhou
King Corn
Maltodextrin 3900
Hubei De
Sugar House
75% maltose 3000
80% maltose 3200
Fructose syrup F42 3100
Jingzhou Han
Bioscience
Fructose syrup F42 3100
Hubei Wuhan
Bao
Liquid glucose 3050
Hubei
Nanyang
biological
Fructose syrup F42 3000
Shanxi Xin
Hong
75% maltose 2800
80% maltose 3050
Shanxi
Changzhi
Kanazawa
Crystalline glucose 4150
Shaanxi
Luzhou
Branch
75% maltose 3200
80% maltose 3400
(Continued on next page)
June/July 2011 www.giract.com Page | 36
Starch Italics Starch Industry Overview
Regional Language News
Starch, sugar prices to settle and sales in general June 17, 2011 (Contd)
Region Product Price
(RMB
/ton)
Sichuan Lili 80% maltose 3400
Sichuan Quanta 75% maltose 3250
80% maltose 3400
Four
Chuanluqing
state biological
Fructose syrup F42 3650
75% maltose 3250
80% maltose 3500
Chongqing
Department of
Biology East
80% maltose 3500
Fructose syrup F42 3600
Anhui Jintai Fructose syrup F42 2950
Anhui Youyong 75% maltose 2950
Xi'an next shop 75% maltose 3200
80% maltose 3400
Guangdong
Shantou
83% maltose 3650
Crystalline glucose 4300
Changchun
Dorsett
75% maltose 3000
Crystalline glucose 4250
Maltodextrin 4050
Zhangzhou,
Fujian
Fructose syrup F42 3500
Fructose syrup F55 4200
75% maltose 3800
(Continued in next column)
Starch, sugar prices to settle and sales in general June 17, 2011 (Contd) The market brief: This week "plasticizer" storm did not stop, the
mainland is very strict food safety inspections,
including Jiangsu, Henan, Anhui, Chongqing and
other provinces, check the larger effort, affected,
most small and medium enterprises in Henan has
been discontinued wait, the downstream decrease
in the amount of food processing enterprises, the
majority of the downstream sugar business
outlook on the sidelines.
Crystalline glucose by food safety inspection, this
week prices were steady weakening trend,
Shandong offer crystalline glucose maintained at
RMB 4 100-4 200/t, Hebei crystalline glucose
mainstream in RMB 4 100/t, Henan offer
mainstream crystalline glucose.
In RMB 4 150/t; some small manufacturers by
RMB 50/t, the situation is still not optimistic
about the shipment, market sentiment remained in
the doldrums, demand is relatively weak on the
other hand, is at wheat harvest this week, part of
the factory shutdowns, workers leave busy,
creating a market decline in capacity utilization,
factory inventory level is incomplete, and the
downstream impact of food businesses subject to
inspection, with the use of mining, the market
outlook to wait and see attitude, the overall
turnover of the main light.
Maltose syrup, the weak market demand, food
safety inspection by the rising costs of raw
materials and factors, some manufacturer‘s cut-off
to be sold. Most cookies, cakes sell for companies
today to adopt the way, wait and see attitude on
the market outlook, the overall turnover of the
main light;
(Continued on next page)
June/July 2011 www.giract.com Page | 37
Starch Italics Starch Industry Overview
Regional Language News
Starch, sugar prices to settle and sales in general June 17, 2011 (Contd)
Fructose syrup prices steady run, downstream
juices, cold drinks, beer business needs has been
launched, the market is relatively active turnover
of enthusiasm to be heating up, the whole
shipment was acceptable;
Maltodextrin, the various regions of the country
offer slightly lower this week, market sentiment is
more deserted, lower procurement requirements in
general, there is no market in the whole state.
Anticipation of Market
Later, with the shopping season starts, summer
beer, cold drinks, carbonated drinks, juice drinks,
milk drinks needs to gradually increase. In
addition, the spot price of sugar by sugar prices
strong outside support, is now in the state steadily,
sugar from sugar and starch analysis of
substitutability, Zhuo record that the business
outlook bullish for more post-market or remained
stable firmer trend.(aptc.cn 19 June 2011)
Vietnamese
Cassava exports increase as China prices surge
Viet Nam exported USD 638 mio of cassava in
the first five months of the year, nearly equal to
110t of the entire export revenue of last year,
according to the Ministry of Agriculture and
Rural Development. Although the domestic price
has risen to VND 5 800/kg, cassava is still
exported to China in large quantities because it
can fetch higher prices.
In recent years, exports to China accounted for
about 5 mio t annually.
(Continued in next column)
Cassava exports increase as China prices surge (Contd)
In recent years, exports to China accounted for
about 5 mio t annually. Viet Nam has about
510 000ha of cassava planted, with an annual
output of nearly 9 mio t.
The ministry estimates the country's domestic
demand for cassava this year will be 8.12 mio t.
Of that figure, 1.89 mio t are used for producing
ethanol, and the remaining volume for animal
feed and confectionary products.
Pham Duc Binh, deputy chairman of the Vietnam
Animal Feed Association, said cassava accounted
for 30-40% of input materials in animal feed
production. However, cassava is also exported so
domestic animal feed plants have not been able to
buy enough for production, Binh told Viet Nam
Economic Times.
Le Khac Triet, director of the Vietnam Cassava
and Cassava Starch Club, said since 2009 cassava
had become an agricultural plant with high
economic value. The price of cassava has
increased to VND 5 700-6 000/kg, compared to
just VND 200-500/kg in 2007-08 and
VND 4 000/kg in 2010.
Farmers in central provinces have expanded the
area under cassava cultivation, raising concerns
among local authorities about forest protection
and transferring to cassava cultivation. In Quang
Ngai Province's Son Ha District, for instance,
farmers have cleared protective forests upstream
of the Thach Nham River to grow cassava.
Ta Tien, acting head of the Son Tra District Forest
Protection Bureau, said this situation had
happened over the past few months.
(Continued on next page)
June/July 2011 www.giract.com Page | 38
Starch Italics Starch Industry Overview
Regional Language News
Cassava exports increase as China prices surge (Contd)
In 2006-10, Quang Ngai had planned for
13 500ha of cassava in 2010, but the area had
increased to 21 000ha in 2010, and is continuing
to rise. In Ha Tinh Province, hundreds of
households in Ky Anh District had also destroyed
protective forests to grow cassava. Triet warned
that cassava had become a hot product and when
output exceeds demand, the price could drop as it
did in 2007-08. At that time, it would be difficult
for farmers to switch to other crops because the
fertility of the soil would be eroded after three to
four years of growing cassava, he said.
To resolve the cassava material shortage, the
cultivation area should not be increased, but
measures should be taken to increase productivity,
Triet said. Farmers in some countries have
harvested cassava output of 40 t/ha a year while in
Viet Nam output is only 17.2t/ha. Measures to
increase cassava productivity include applying
advanced farming techniques and finding
high yield cassava strains, he said. He added that
his club had found new cassava strains with a
high yield of 40 t/ha a year.
(vietnamnews.vnagency.com.vn 20 June 2011)
Portuguese
U.S.: Ethanol Gasoline Futures Plunge the Hold Steady, Corn Advances Ethanol futures in Chicago unchanged were
declined on the gasoline demand and concerns on
corn gained that inclement weather slowed
planting. The biofuel was to steady crude oil and
gasoline plunged after ADP Employer Services
said employment rose by 38 000 in May, the
smallest gain since September and below an
estimate in a Bloomberg News survey of 175 000.
The Government report Showed about 86% of the
corn crop was planted as of May 29, behind the
five-year average of 95%.
"Basically Ethanol was caught in the middle,"
said Matt Janney, a trader at Citigroup Global
Markets Inc. in Chicago. Denatured ethanol for
June delivery settled unchanged at USD
2 642/gallon on the Chicago Board of Trade.
Prices have increased 11% this year. In cash
market trading ethanol in New York dipped 1
cent, or 0.4%, to USD 2 725/gallon and in the
U.S. Gulf the additive lost 2 cents, or 0.7%, to
USD 2 765, According to data compiled by
Bloomberg.
Ethanol in Chicago Declined 2 cents, or 0.8 %, to
USD 2 635/gallon and on the West Coast the
biofuel slid 3.5 cents, or 2.1%, to USD 2.78. Corn
futures for July delivery rose 11 cents, or 5.1%, to
USD 7 585 a bushel in Chicago. The grain has
more than doubled in the past year. Crude oil for
July delivery declined USD 2.41, or 3.2%, to
settle at USD 100.29 a barrel on the New York
Mercantile Exchange. Gasoline for July delivery
fell 7.3 cents, or 3.2%, to settle at USD 2.9773 a
gallon in New York. Futures Declined 9.1% last
month. (udop.com 04 June 2011)
June/July 2011 www.giract.com Page | 39
Starch Italics Starch Industry Overview
Regional Language News
Ethanol corn leaves 17% more expensive The U.S. Government subsidies to ethanol may
have already inflated by up to 17%, so artificial,
corn prices in 2011. The estimate appears in a
study that the International Centre for Trade and
Sustainable Development (ICTSD, its acronym in
English) released this week, days after the
U.S. Senate approved an amendment that would
extinguish the incentive of USD 5 bio to the
sector. Currently, producers who use the blend of
ethanol receives a tax credit of USD 0.45/gallon.
The ICTSD, a "think tank" based in Geneva,
estimates that the high gas prices stimulated
consumption of ethanol, creating a backdrop of
tight domestic supply of corn. "Under these
conditions, the incentives for mixers have a
significant impact on prices of grain," says
Bruce Babcock, a Professor at Iowa State
University and author of the study, said in a
statement. For him, the U.S. policy for the sector
could be more flexible in times of shortage of raw
material.
The use of corn for ethanol production more than
tripled since 2004 from 36 mio to nearly
130 mio t - the amount corresponds to almost all
Brazilian production of soybeans and corn
expected this year. The supply has not kept pace
with demand, and participation in the allocation of
biofuel crop nearly quadrupled during this period.
From each collected 10 sacks on American soil,
some distillers will supply 3.8, according to the
Department of Agriculture (USDA). As a result,
Americans now use corn to make ethanol than the
fuel feed to meat production.
If U.S. production of ethanol levels had been
maintained in 2004, the study suggests ICTSD,
corn prices in 2009 would be approximately 21%
lower than those recorded.
(Continued in next column)
Ethanol corn leaves 17% more expensive (Contd)
During the period, commodity prices more than
tripled amid not only the growth of biofuels, but
the demand for food in developing countries. The
weakening dollar and rising flows of hot money
into the commodities futures markets also
contributed to the shift in prices.
Although they have fallen nearly 12% last week,
corn futures prices traded on the Chicago Board
of Trade soared nearly 85% in the last 12 months.
On day 9, reached a history of highs after the
USDA lowered its forecast by 22% for local
stocks passing the 2011/12 harvest. The expected
volume is the lowest in 15 years.
The adjustment reflects the impact of severe
rainfall on crop yields, especially in Ohio. World
stocks were also reduced by 13% to its lowest
level in five years - largely a result of increased
consumption in China. In Brazil, harvesting of the
winter harvest is delayed, due to the delay in
planting. According to report released yesterday
by the consulting Céleres, only 2.5% of the crops
were harvested until last Friday, up 9.7% over the
same period of 2010.
The concern with the level and volatility of
agricultural prices should dominate the agenda of
the agriculture ministers of the G-20, who meet in
Paris (22 June 2011)
Agreement in the U.S. can benefit Brazilian ethanol
U.S. Senate leaders reached an agreement to end
the import tariff on Brazilian ethanol in the United
States and reduce subsidies to American
producers. The agreement aims to reduce by the
end of the month subsidies for ethanol production
in the U.S., where it is made from corn.
(Continued on next page)
June/July 2011 www.giract.com Page | 40
Starch Italics Starch Industry Overview
Regional Language News
Agreement in the U.S. can benefit Brazilian ethanol (Contd) It is a shorter period than previously thought
possible until a few weeks ago and a sign of how
tax policy can change quickly in the face of a debt
of USD 14.29 trillion.
Senator Dianne Feinstein, a Democrat, of
situation, said in a statement that it had reached an
agreement with other senators of the party under
which a tax of USD 0.45/gallon (3.7854 liters) of
ethanol in the mix gasoline expire on July 31. But
the tax of USD 0.54/gallon of imported ethanol
also expire at the end of the month.
The deal should benefit especially the Brazilian
ethanol industry, which has struggled to gain
access to a large scale in the U.S. market because
of the rate of USD 0.54/ gallon.
If it goes ahead, the deal could generate about
USD 1.33 bio in savings to reduce the U.S. debt.
And one-third of these savings would be used to
extend tax credits, including tax credits for the
distribution infrastructure for alternative fuels
such as ethanol pipelines that ethanol producers
hope to build.
The agreement is important because the senators
involved are defenders of U.S. ethanol producers
who were trying to keep the federal government
support to the sector. (wsj.com 08 July 2011)
The development of bioethanol production is possible only in case of cancellation of excise duty USDA
At the moment in Russia there is no official
statistics on production, consumption and trade of
biodiesel fuel and bioetanolovym. According to
various sources, the share of biofuels in total
energy production in the country is about 1.3%.
(Continued in next column)
The development of bioethanol production is possible only in case of cancellation of excise duty USDA (Contd) According to experts of the USDA, ethanol
production in Russia will become profitable only
in the event of cancellation of excise duty. High
excise taxes on alcohol have a negative impact on
the production of fuel.
Russian law does not distinguish ethanol from
alcohol for the production of alcoholic beverages.
In many other countries, such a distinction exists,
and excise duties on fuel ethanol is absent, which
promotes the development of the biofuel industry.
The development of biofuels is not provided by
the National Project "Development of
agriculture", and without appropriate government
support attempts to create a self-defeating. The
reasons for low-interest government to industry
are the high cost of biodiesel, a mixed-existent
policies on bio-fuel producers, low domestic
demand and the unsuitability of vehicles to use
biofuels. Negative impact on the profitability of
its production has increased prices for wheat and
oilseeds.
Recently, the head of the state corporation
"Russian Technologies" Sergey Chekmezov
announced the start of construction of the first
large-scale plant to produce biofuels, which will
be built in the Irkutsk region, Tulun. The main
raw materials are used waste wood.
(proagro.com.ua 18 July 2011)
June/July 2011 www.giract.com Page | 41
Starch Italics Starch Industry Overview
Regional Language News
Spanish The U.S. Senate vote to end subsidies for ethanol A majority consisting of U.S. senators from both
parties voted to end more than three decades of
subsidies for ethanol, pointing out that other
programs are often viewed as untouchable could
be cut at a time when Democrats and Republicans
are negotiating a broad agreement deficit
reduction.
These exemptions, which currently costs
USD 6 000 mio/year is often viewed as
untouchable because of the power of voters in
farm states and their legislators.
Presidential candidates often make their
pilgrimage to Iowa every four years, to promise to
keep the exemptions, tariffs and other support to
maintain the production of fuel ethanol from
corn.This year, however, some Republican
candidates have refused to support these tax
breaks.
Vote is not the end of federal support for ethanol
industry. It is believed that the House of
Representatives rejected the bill arguing that
changes to the tax code, according to the
U.S. Constitution, must originate there and the
White House has said that rejecting the law would
be too abrupt. But the vote of 73 27 indicates that
in times of fiscal pressure as the current programs
that eventually were impregnable now could be
vulnerable.
(Continued in next column)
The U.S. Senate vote to end subsidies for ethanol (Contd) The vote was prompted by a coalition of
lawmakers from the left and right who want to
end subsidies for wealthy interest groups rather
than reducing social assistance programs. The
opposition consisted of a block of legislators from
farm states seeking to halt the project.
The Senate measure would also open the door to
attacks on other tax breaks, such as those that
benefit the oil companies, in the interest of
reducing the deficit. Republicans have been
reluctant to do so, but 33 Republicans joined
40 Democrats and independents to support the
bill, which has the effect of raising taxes on oil
refineries.
However, Republican leaders have so far not
shown signs that they are open to other tax
increases and have insisted that these are not
negotiable in the budget discussions.
The political climate has changed rapidly. Just in
December, Congress voted to extend the ethanol
subsidy for another year. But ethanol is under
increasing pressure from various groups,
including the food industry concerned about the
rising cost of corn and environmentalists who had
concluded that corn ethanol was an effective way
to reduce emissions of greenhouse gases.
Currently, much of the gasoline sold at service
stations in the country contains up to 10%
ethanol, in part because federal rules require. The
government of President Barack Obama has
proposed that the mixture is limited to 15%,
despite the objections of automakers worried that
higher levels of ethanol will damage engine
components in cars.
(Continued on next page)
June/July 2011 www.giract.com Page | 42
Starch Italics Starch Industry Overview
Regional Language News
The U.S. Senate vote to end subsidies for ethanol (Contd) Automakers design cars many so-called "flexible
fuel" to operate on ethanol blends up to 85%.
But few stations outside the central U.S. offer
such fuels. The ethanol industry and its
supporters have been preparing for the end of the
tax exemption, criticized the vote. "We need an
easy path, not a cliff, so the only alternative to
oil," said Sen. Amy Klobuchar (D-Minnesota).
"We're talking to stagger to an industry that
provides 10% of the country's fuel supply."
Supporters of repeal said the subsidy of
USD 6 000 mio a year represents a waste to
support a fuel whose promises of cost savings,
less pollution and energy efficiency have not
materialized. "This industry has been receiving
corporate benefits for too long," said Sen. John
McCain (Republican, Arizona), who has been
fighting for years against subsidies.
(online.wsj.com 29 June 2011)
Indonesia
EPA mandate to reduce its cellulosic ethanol again for 2012 Remember five years ago, when cellulosic ethanol
will fill our tanks without eating into food crops?
Environmental Protection Agency did not,
because it must continue to roll back the
minimum renewable fuel standards put in place
by the part of the 2005 Energy Policy Act (SDM.
6). 2012 will be no different from the last two
years, when the EPA backed cellulosic ethanol
target of 100 mio gallons in the tank for 2010 and
250 mio gallons in 2011, to reduce those numbers
only 6.5 mio gallons for the second year . EPA
has proposed a regulation in 2012 the
requirements in 12.9 mio gallons .
(Continued in next column)
EPA mandate to reduce its cellulosic ethanol again for 2012 (Contd) Part of the problem, the EPA says, is that the
supplier does not create biorefineries and thus not
produced the projected production volume in
2005 as HR. 6 signed by then president George
W.Semak. "What bear?" asked the representatives
of Lee Terry of Nebraska. "I would expect mass
production now" he commented at the hearing in
May. In March, President Obama shows
willingness to get four new cellulosic ethanol
refinery up and running by 2013.
Under the original plan contained in HR. 6, the
United States must use one bio gallons of
cellulosic ethanol in 2013, the numbers are also
likely to be rolled back due to lack of fuel
available in the market, although the EPA said it
will continue to evaluate the market and remain
optimistic that celluloic ethanol will play a bigger
role in the mix fuel the nation .
EPA reduces the cellulosic ethanol mandate that
again for 2012. (7x69.com 28 June 2011)
Belarussian
Corn, Soybeans Fall on Speculation of China to raise rates ; Wheat Advances
Corn and soybeans dropped on speculation that
China may tighten monetary policy to contain
inflation , decline in demand for commodities .
Corn for March delivery lost as much as 0.9% to
USD 5.6925 a bushel on Board of Trade
adsotkavo and WAS at USD 5.72. Soybeans for
January delivery fell as much as 0.8% to
USD 12.8525 a bushel and last traded at USD
12.8875. (Continued on next page)
June/July 2011 www.giract.com Page | 43
Starch Italics Starch Industry Overview
Regional Language News
Corn, Soybeans Fall on Speculation of China to raise rates ; Wheat Advances (Contd) China Bureau of Statistics has put forward the
release in November of economic data, including
inflation and retail sales in December 11,
increasing speculation the central bank will raise
interest rates this weekend. Consumer prices were
4.4% in October, fastest pace in two
years, because of higher food prices. The country
is the largest importer of soybeans in the world.
"Corn and soybeans have been under downward
pressure from speculation about interest rate
increase of China, "Toshimitsu Kawanabe, an
analyst at Tokyo-based commodity broker central
to Sit , said today. Overall trading was thin before
the U.S. . Department of the global supply and
demand report tomorrow Agriculture he said.
In China, some soybean crushers to stop
production for profit plunge in the price-control
measures of the government have stalled sales of
soybean oil and meal, the China National Grain &
Oils Information Center said in an e-mailed
statement.
Delay Delivery
Chinese buyers also delayed soybean supplies
some shipments originally scheduled for arrival in
February-April, as slowing sales of soybean meal
caused them to cut production, says researcher
Grain.gov.cn .The demand for protein food falls
as the country's cattle inventory is reduced
researcher wrote in an e - mail a daily report.
Higher profits in the last two months have
prompted farmers to sell animals earlier than
usual , he said.
China's soybean arrivals may begin to fall in
February, after an average of 5 mio t in November
and January, the researchers say. Commercial
soybean inventory China is about 6.5 mio to
7 mio t at the present time, he said.
(Continued in next column)
Corn, Soybeans Fall on Speculation of China to raise rates ; Wheat Advances (Contd)
U.S. Department of Agriculture tomorrow may
forecast that world maize stocks would be
128.7 mio t in September . 30, less than
129.1 mio t estimated last month , according to a
study Bloomberg News, with 17 analysts. Global
stocks of soybean can be 60.5 mio t in September
. 30, compared with 61.4 mio in November .
World wheat stocks will be 171.3 mio t in
May 31, less than 172.5 mio t projected U.S.
Department of Agriculture last month , according
to the survey .
Wheat Revenue
Wheat for March delivery rose 0.7% USD 7895 a
bushel in Chicago and last traded at USD 7 885.
Cost touched USD 8:11 for December 7, its
highest level since August . Sixth
United States, the largest shipper of wheat in the
world, may not have the material and technical
capacity to meet rising global demand , after rains
to reduce the quality of the harvest in Canada and
Australia , the United Nations said .
How many 8 mio t of wheat crop in Australia may
be reduced due to excessive rains and the release
of Canada has suffered from wet weather,
pressing importers to seek alternative suppliers
,said Abdolreza Abbassian , economist at the UN
Food & Agricultural Organization , in an
interview, citing estimates government .
Dry weather in Russia can keep the country from
the export market for another year, and he can
count on Kazakhstan and the Ukraine to meet
domestic shortages of grain, he said.
"If that is the case, we can see the grain prices to
soar again , "Ker Chung Yang , an analyst at
Phillip Futures Pte., said in an e-mail today.
(Continued on next page)
June/July 2011 www.giract.com Page | 44
Starch Italics Starch Industry Overview
Regional Language News
Corn, Soybeans Fall on Speculation of China to raise rates ; Wheat Advances (Contd) Futures rose to their highest in nearly two years in
August, after a severe drought in at least half of
the century in Russia led the third-largest
producer of wheat last year to ban the export of
grain. (news.isc.vn 27 July 2011)
Brazil
Sale of ethanol in jobs fell 8.5% in 2010
The ethanol sales in Brazil fell 8.5% last year
compared to 2009. It was the first decrease in
demand recorded in the last seven years. In 2010,
there were sales for resale 15.1 mio cu m of fuel,
compared to 16.5 mio cu m in 2009.
The information contained in the "Annual Report
of Retail Fuel - 2011", released, 26 days, by the
National Federation of Trade Fuels and
Lubricants (Fecombustíveis). "Considering the
country's economic momentum, the result is bad,"
says the document, which holds that "2010 will
definitely not go down in history as a good year
for the ethanol market."
The technical director of the Union of Sugarcane
Industries (UNICA), Antonio de Padua
Rodrigues, said in a speech during the ceremony
to launch the publication, which has no fault
alcohol because sugarcane to produce ethanol.
Rodriguez showed pessimism about the prospects
for this year, since the estimate is a production
similar to that of 2010, around 25.5 bio liters of
ethanol.
That's because there will be an entry in the
country of 3 mio vehicles - added.
(Continued in next column)
Sale of ethanol in jobs fell 8.5% in 2010 (Contd) In 2010, the fuel sector as a whole grew 8.4%
over 2009. The growth exceeded the 7.5%
expansion of the Brazilian economy in the period.
With the growth of industry, retail grossed over
12% compared to 2009, then computed the
marketing of gasoline, diesel, ethanol and LPG.
Revenue last year was RUSD 223.1 bio against
RUSD 199.3 bio in 2009. The value of revenues
in 2010 is 5.4% of GNP. With this, the
government raised taxes on a total of
USD 64.2 bio in 2009 while revenues reached
RUSD 57.5 bio.
The Fecombustíveis expect a less vigorous growth
in fuel consumption in Brazil this year. The most
pessimistic forecast is credited to the federal
government's decision to put public finances in
order and ward off the threat of runaway inflation,
with a cut of USD 51 bio in federal budget this
year.
"They must have a direct impact on economic
activity and sales of cars that are going to grow,
but at a slower rate than found in 2010," predicts
the annual report.
Cartel
Fecombustíveis's president, Paul Miranda Smith
denied that the industry is cartelized. There is no
villain to rising prices. It is the structure of the
country. You need to rationalize the tax. The tax
burden is high - said Smith
At times, according to Borg, the dealer gives up
his profit margin to sell the fuel in amounts
similar to the nearby competitor. And this
neighbor does not always pay taxes - Smith noted.
According to the executive, the Fecombustíveis
not encourage, participate and do not agree with
the combination of prices. Each one puts the price
you want, he said.
(canalrural.com.br 03 June 2011)