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Ethanol instead of exports: New use for Michigan corn
By KEVIN WALKER
Michigan Correspondent

ALMA, Mich. — Michigan’s ethanol industry seems to be running full speed ahead with several construction projects underway, as well as a proposed new plant to be located in Alma and run by Liberty Renewable Fuels (LRF).

There are currently four ethanol plants under construction in Michigan. These include The Andersons Albion Ethanol, located in Albion; Midwest Grain Processors in Blissfield, often referred to as Great Lakes Ethanol in Riga Township; U.S. Bio-Energy in Lake Odessa; and Marysville Ethanol in Marysville.

The Albion plant is close to completion, and is scheduled to be dedicated on Saturday, Aug. 5.

David Skjaerlund, president and chief operating officer of LRF, told the Michigan Farm Bureau recently that the company has reached an agreement with several local elevators to receive grain and transport it to the new ethanol plant.

“We have partnerships with elevators in Oakley, Hemlock, Saginaw, Auburn, Shepherd, Rosebush and Delwin,” Skjaerlund said.

There’s one plant now operating in Caro, Mich., called Michigan Ethanol. That plant was completed in 2002, and was built by the Broin Companies.

“Those ethanol plants are really going to mean a lot to those rural communities,” said Jody Pollok, executive director of the Michigan Corn Growers Assoc.

In addition to plants under construction and the proposed plant in Alma, rumors frequently float around about other locations for new ethanol plants.

“It changes almost daily,” said an official with the Michigan Department of Agriculture (MDA) who’s familiar with the ethanol industry. He didn’t want to be named for this article.

The official said that Flint, Detroit and Traverse City have been named recently as possible sites for new ethanol plants.

Pollok, however, said all the plants so far are being built in rural areas close to where the corn is grown.

“People need to develop sound business plans,” the MDA official said. “People need to develop feasibility studies.”

Pollok agreed with this, saying that producers “are aware they are looking at the market.”

According to the official with the MDA, if the number of ethanol plants continues to grow, at some point there could be a problem with having enough corn to supply the facilities. The official said there’s enough supply for what is being built now, plus one or two more plants. Pollok seemed less concerned.

“We’re looking at a pretty good carryover,” she said, referring to unused corn from the previous year. “We’ve exported in the past 40 percent of the harvest.”

According to Pollok. 80-100 million bushels of corn are exported out of Michigan each year. At this point, 15-17 million bushels of corn a year will be put into each ethanol plant in Michigan.

If these exports were needed for ethanol production, it would be less expensive for producers to make their corn available for that purpose, Pollok said.

Pollok also pointed out that one-third of corn that’s used for ethanol production comes out as distillers grain, which can be used for livestock feed.

On the retail side, Michigan continues to add E85 fuel pumps so ethanol can find its way into cars. So far, there are 16 E85 pumps in the state, and more are being added all the time.

The Meijer Co. has plans to add 20 E85 pumps in Michigan, and just installed one in Warren, Mich. last week.

In addition, the Corn Marketing Program of Michigan has joined with eight other Midwestern states to apply for a grant from the U.S. Department of Energy for the purpose of installing more E85 pumps in the state. Under the Midwest E85 Corridor Program, Michigan has applied for 20 new E85 fueling sites along the major corridors of the state. Michigan could receive as much as $200,000 in matching funds to retrofit current sites or install new E85 facilities.

7/26/2006