Farmers prepare to meet biofuel demand
DANVILLE – This year, farmer Greg Learnard intends to plant more corn than he usually does, because he's anticipating an increased demand from local ethanol plants.
Learnard of Catlin normally plants 1,000 acres of soybeans and 1,000 acres of corn, but this year, he'll plant an extra 100 acres of corn and only 900 acres of soybeans.
Learnard said other farmers are planting more corn, too, and he's excited about the potential that proposed ethanol plants pose for agriculture.
"It's been a while since we've seen $4 corn, so it's hard not to be excited about all this," Learnard said, referring to current corn prices that have increased recently on speculation of future demand for corn because of construction of ethanol plants.
Local farmers filled the Vermilion County Farm Bureau's auditorium Tuesday night to hear about two renewable fuel projects in East Central Illinois that will rely on soybeans and corn from local farms.
Mark Burke, president of Biofuels Company of America, discussed the biodiesel plant that's under construction at Bunge of North America in downtown Danville. It's a $50 million investment in a facility that will use the soybean oil currently generated at Bunge to make 45 million gallons of biodiesel fuel.
Reg Ankrom of Illini Ethanol LLC talked about the ethanol plant being built near Royal in Champaign County. That $200 million facility will produce 100 million gallons of ethanol and use about 38 million bushels of corn per year.
Last year, Champaign County farms yielded 49 million bushels of corn, and Vermilion County farmers produced about 39 million bushels. Both counties ranked in the top 10 of all Illinois counties for corn production.
Ankrom said the high density of local corn production is a major reason for building the ethanol plant here.
"We will be buying a lot of your corn, and we look forward to buying your corn," Ankrom said.
The biodiesel plant at Bunge is scheduled to begin production in February 2008, and the Royal ethanol plant should be producing later that year.
Between now and then, Learnard plans to seek out more specific information about how the plants will buy local crops. He questioned how much corn the ethanol plants will actually need, whether the demand will be spread throughout the year and whether the corn will be trucked in to the plants.
In addition to the Royal plant, two more ethanol plants have been proposed in Vermilion County and another in Champaign County, which would increase the demand for local corn. Those three projects are moving toward the final steps in the Illinois Environmental Protection Agency's permit process.
Other farmers who attended Tuesday's informational meeting had some of the same questions as Learnard.
Burke said the Bunge facility is already producing the necessary amount of soybean oil needed to make the biodiesel product, and that methanol, which is used in the biodiesel process, cannot be replaced with ethanol. Burke said he wishes ethanol could be used, but only methanol will work.
The market for biodiesel, he said, is in bus fleets and utility company fleets – mostly for use in over-the-road vehicles like semitrailers.
About 200 million gallons of biodiesel were sold last year, and that number is expected to increase to 600 million gallons or up to 1 billion gallons in the next five years, Burke said. The biodiesel plant will operate 24 hours a day and employ 15 people.
The ethanol plant in Royal, Ankrom said, will create a year-round demand for corn, because the plant won't take its entire 38 million bushels all at harvest time. It also will be a large user of water – about 1.2 million to 1.3 million gallons of water per day, Ankrom said, but 75 percent of that will be recycled and very little wastewater will be produced.
Initially, only corn will be used to produce ethanol at the plant, but Ankrom said the plant will be designed to allow for ethanol production from other crops, such as switchgrass. But he assured Tuesday's audience that the technology for that is still several years down the road.
Ankrom also assured his audience that Illini Ethanol intends to develop good relationships with its local grain suppliers and local communities, because the company intends to be producing ethanol for many years to come.
"We want to be good neighbors," said Ankrom, who explained that the Royal facility is one of seven ethanol plants the company is planning to build. "We want to contribute to the local economy and be good corporate partners for a long time."