Farming and your freedom: Will sugar sweeten ethanol’s economic clout for awhile?

by Peter Graham, Columnist

Sugar based ethanol is little known in the United States, although our competitor, Brazil, has been involved in it for years. Now, the USDA has made available tons of surplus sugar left over from providing producer price supports.
An often idled plant in Aurora, NE is using it to ramp up for more ethanol production. The Pekin, IL-based Aventine Renewable has purchased some of the USDA surplus and begun production of sugar-based ethanol at Aurora.
According to The Kearney (NE) Hub, the government occasionally makes price support surplus sugar available on the open market. Aventine bought some and production is underway. Todd Sneller, administrator of the Nebraska Ethanol Board told The Hub the purchase was probably the first commercial use in Nebraska. “The liquidation of sugar stocks by the commodity program at USDA provides a means of diverting the U.S. sugar inventory into a market where it will disappear without distorting or competing with conventional table sugar markets,” Sneller told The HUB.
Sugar-based ethanol is common in many places, such as Brazil, which uses sugar cane to produce the product. In the U.S., sugar comes from sugar beets. The use of sugar may disappear in August when producers switch back to corn-based production, so sugar may be a blip on U.S. ethanol’s production map, or it could be a harbinger of things to come.
Aventine CEO Mark Beemer said 52 people are now working at the formerly shuttered plant and 25 more may be employed soon. The Hub said the wildcard in the ethanol industry will probably be played next month when the U.S. Environmental Protection Agency (EPA) rules on how much ethanol will be required for motor fuels across the country.
The EPA proposed last year that the renewable fuels mandate be cut by nearly nine percent to only 13 billion gallons due to lower gasoline consumption. That, the agency said, makes it impossible to blend more ethanol without using higher octane fuels, such as E15 ethanol.
Beemer figures that no matter the outcome of the renewable fuels standard battle, there will be litigation from all comers in the fight, including Big Oil. That could make for a summer of fun for farmers and ethanol production folks.
I’ll see ya!