Hostname: page-component-cd9895bd7-gbm5v Total loading time: 0 Render date: 2024-12-18T10:00:03.706Z Has data issue: false hasContentIssue false
  • English
  • Français

Challenges to Producer Ownership of Ethanol and Biodiesel Production Facilities

Published online by Cambridge University Press:  09 September 2016

Phil Kenkel  and
Rodney B. Holcomb
Phil Kenkel
Affiliation:
Department of Agricultural Economics, Oklahoma State University
Rodney B. Holcomb
Affiliation:
Department of Agricultural Economics, Oklahoma State University
Get access Rights & Permissions [Opens in a new window]

Abstract

This study examines the rapidly expanding biofuels industry and identifies challenges for producer-owned biofuel projects. The U.S. ethanol industry has been growing rapidly, and biodiesel production is poised for similar growth. Producer involvement is driven by the desire to add value to farm commodities and the impact of biofuel projects on local grain prices. Local state and federal incentives have also stimulated producer interest. The long-run profitability of biofuel projects is driven by feedstock availability, access to market centers for biofuels, access to markets for coproducts, and utility costs and availability. The rapidly increasing size and scale of ethanol and biodiesel plants make it difficult for producers to fund these projects. Additionally, the development and adoption of new non-grain biofuel technologies may negate some comparative advantages of producers, such as feedstock cost and availability. The geographic expansion of biofuel projects into grain deficit regions will also create additional challenges.

Keywords

alternative energy biodieselethanolproducer-owned businessO13Q42Q55
Type
Invited Paper Sessions
Information
Journal of Agricultural and Applied Economics , Volume 38 , Issue 2 , August 2006 , pp. 369 - 375
Copyright
Copyright © Southern Agricultural Economics Association 2006

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Bothast, R.J. New Technologies in Biofuel Production. Presentation at the U.S. Department of Agriculture (USDA) Agricultural Outlook Forum, February 24, 2005.Google Scholar
Coltrain, D. Economic Issues with Ethanol, Revised. Kansas State University, September 2004. Internet site: www.agmanager.info/agribus/energy/ (Accessed December 15, 2005).Google Scholar
Cooper, G. An Update on Foreign and Domestic Dry Grind Ethanol Coproducts Markets. National Corn Growers Association. Internet site: www.nega.com/efhanol/pdfs/DDGSMarkets.pdf (Accessed December 15, 2005).Google Scholar
Crooks, A., and Dunn, J.. “Farmer-owned ethanol and the role of information technology.” Rural Cooperatives 72,5(2005):8–13.Google Scholar
Department of Energy (DOE). Transportation Sector Energy Consumption Estimates 2001. Internet site: http://www.eia.doe.gov/emeu/states/sep_sum/html/sum_btu_tra.html (Accessed December 15, 2005).Google Scholar
Dhuyvetter, K.C., Kastens, T.L., and Boland, M.. The U.S. Ethanol Industry: Where Will It Be Located in the Future? Agricultural Issues Center, University of California, November 2005.Google Scholar
Hansen, R. Ethanol Profile. Agricultural Marketing Resource Center, Iowa State University. Internet site: http://www.agmrc.org/agmrc/commodity/energy/ethanol/ethanol.htm.Google Scholar
Hettenhaus, J.R. Ethanol Fermentation Strains: Present and Future Requirements for Biomass to Ethanol Commercialization. Report to United States Department of Energy and National Renewable Energy Laboratory.Google Scholar
Kenkel, P., Holcomb, R.B., Dunford, N., and Dicks, M.. Economic Feasibility of a Producer-Owned Oilseed Processing Facility in Oklahoma. Stillwater, OK: Oklahoma State University, November 2005.Google Scholar
Markham, S. Distillers Dried Grains and their Impact on Corn, Soymeal, and Livestock Markets. Presentation at the USDA Agricultural Outlook Forum, February 25, 2005.Google Scholar
McNew, K. and Griffith, D.. “Measuring the Impact of Ethanol Plants on Local Grain Prices.” Review of Agricultural Economics 27,2(2005): 164–80.Google Scholar
Mielenz, J.R. “Ethanol Production from Biomass: Technology and Commercialization Status.” Current Opinion in Microb 4(2001):324–29.Google Scholar
Morris, D. “Do Bigger Ethanol Plants Mean Smaller Farmer Benefits?” Farmer Cooperative Magazine November-December 2005:20–22.Google Scholar
Nalley, L., and Hudson, D.. The Potential Viability of Biomass Ethanol as a Renewable Fuel Source: A Discussion. Staff report 2003-03, Mississippi State University, Department of Agricultural Economics, 2003.Google Scholar
National Biodiesel Board. Current and Proposed Biodiesel Plants, September 2005. Internet site: http://www.biodiesel.org (Accessed December 15, 2005).Google Scholar
Parrish, D.J., and Cundiff, J.S.. “Long-Term Retention of Fermentables during Aerobic Storage of Bulked Sweet Sorghum.” Atlanta, GA: Proceeding of the 5th Annual Solar and Biomass Workshop 1985:137–40.Google Scholar
Rains, G.C., Cundiff, J.S., and Vaughan, D.H.. “Development of a Whole-Stalk Sweet Sorghum Harvester.” Transactions in Agriculture 33,1(1990):56–62.Google Scholar
Renewable Fuels Association. Internet site: http://www.ethanolrfa.org/ (Accessed December 15, 2005).Google Scholar
Urbanchuk, J.M. The Impact of Growing Ethanol Byproduct Production on Livestock Feed Markets. Presented at the USDA Agricultural Outlook Forum, February 20, 2003.Google Scholar
Worley, J.W., and Cundiff, J.S.. “System Analysis of Sweet Sorghum Harvest for Ethanol Production in The Piedmont.” Transactions of the ASAE 34,2(1991):539–47.Google Scholar
Wyatt, V.T., Hess, M.A., Dunn, R.O., and Foglia, T.A.. “Fuel Properties and Nitrogen Oxide Emission Levels of Biodiesel Produced from Animal Fats.” Journal of the American Oil Chemists' Society 82,8(2005):585–91.Google Scholar