Ethanol: cattle love leftovers
When Commercial Alcohols' Chatham plant starts producing ethanol later this year, it will also be cranking out distillers grains, about 127,000 tonnes a year.Dried distillers grains are an excellent protein source for both the beef and dairy feeding industries. It's the equivalent of about five million bushels of corn, says Doug MacKenzie, Commercial's president
Graeme Hedley, Ontario Cattlemen's Association executive vice-president, doesn't see the ethanol plant bringing about a major change in the structure of the beef feedlot industry in Ontario. "Chatham isn't the heart of the feedlot industry," he says. And a beef ration can't be based entirely on distillers.
For now, Commercial will be selling its production to Europe, and hoping that eventually distillers grain will find a home in feedlots and dairy barns here in Ontario.
Leftover grains come out of the distilling process at about the same consistency as soup. To be useful as feed, distillers must be dried to about 70 per cent dry matter, like corn silage.
Commercial already has the technology in place to dry the distillers. This is critical to trucking the product any distance, says OCA's Hedley.
Jack Rodenburg, Ontario agriculture ministry livestock specialist based in Woodstock, says the on-farm use of dried distillers will depend on the price that is charged for it.
"It's very palatable and a nice little fat source and has some good bypass protein value," says Rodenburg. Nutritionally, it is worth about the same as one ton of half soybean meal-half corn on a dry matter basis, he says, and expects the dried distillers will find a ready home in Oxford county, the heart of Ontario's dairy industry, a 150 km truck haul from Chatham. - DS
© copyright 1997 Agriculture Publishing Company Limited.
backBy ROBERT IRWIN
On a crisp November morning, seemingly endless hordes of Canada Geese head south over a weed covered 27 acre parcel of vacant land in Cornwall's industrial park - much as they did last year.It wasn't supposed to be that way this year. Honking trucks, not honking geese, were to be providing the scene's soundtrack, unloading corn at a $40-million ethanol plant pumping out 55 million litres of various kinds of alcohol annually for Seaway Valley Farmers Energy Co-operative and Seaway Grains.
Despite an unprecedented share sales drive, which Seaway president Bud Atkins estimates raised $10 million from the community, Seaway was delayed by a problem familiar to many Canadian farmers over the years: Bankers wouldn't buy their idea.
But that's changed now, according to Atkins. "We've got two banks that have indicated that they want to move ahead rapidly and finance the plant."
He won't name them, but says the banks are "foreign." According to Atkins, Seaway has been the victim of a malicious letter-writing campaign by a competitor.
He says the disinformation soured lenders and turned up the heat with the Ontario Ministry of Finance and the Ontario Securities Commis-sion. Roger George, then president of the Ontario Federation of Agriculture, and Terry Daynard, Ontario Corn Producers Association executive manager, came to the rescue and the regulators were appeased with a new offering statement.
The Laframboise Group from Cornwall, once highly touted in Seaway news releases, was to have built the plant. It parted company with Seaway earlier this year in what Atkins describes as a dispute over construction costs.
When the idea for an ethanol plant was first hatch-ed, local farmers were excited by the prospect of selling their corn to a new market. However, with last year's high corn prices, only 46 per cent of Seaway members responded to a request for information about supplying corn.
Now broker Parrish and Heimbecker will supply corn and hedge plant requirements on the Chicago Board.
Another change for this year: All alcohol produced will go to E D & F Mann, a long-established international alcohol marketer.
"We have come to realize we are little guys playing in a big boys' game," says Atkins, who makes no secret it's been a tough job and he's had to deal with lots of rumours.
"I've heard everything from we're shutting down to we've sold our investment in the project." Despite this, he says the community has stood behind him, and none of the approximately 2,400 investors has cashed in their shares.
Ontario Agriculture Minister Noble Villeneuve, a neighbour of Atkins', came up with a $3-million grant for the plant soon after the Harris government began the cuts that saw groups across the province lose government support. Still solidly behind Seaway, he notes the province is short of ethanol and results at Commercial Alcohol's Tiverton plant show ethanol is a good market for low-quality corn.
"Here in eastern Ontario we always have that one year every now and again that the corn gets finished off. [Seaway's] a home for it. That's important," Villeneuve says.
Atkins still hopes plant construction will get underway before the last southbound goose disappears across the St. Lawrence River this fall.
© copyright 1997 Agriculture Publishing Company Limited.
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Wheat plant westbound?
The future of Ontario's wheat ethanol industry should be decided this month.Metalore Resources Inc., a natural gas and mining company based at Simcoe, is expected to announce the location of an 80-million-litre facility this month. And the plant that was originally to be built in the Brant county area could be heading West.
Metalore president George Chilian says "we have several sites that are alternative sites, and they vary from places in Ontario to places in Alberta.
"We may have decided in the back of our minds, but we're not willing to tell you yet."
Chilian says financing for the plant is already in place. He refuses to name the backers, referring to them only as "a very large agri-industry partner that operates in both the United States and Canada." Construction of the plant could start this fall, and production is expected to start in late 1998 or early 1999.
While Chilian hasn't ruled out the possibility of the plant coming to Ontario, he says a western province such as Alberta, with abundant, cheap natural gas to power a distillation plant and lots of spring wheat, has a definitive advantage.
Chilian points out that Ontario wheat, mainly of the soft winter variety, has lower protein than the Prairie product, which is a key factor in determining the quality of the gluten product.
"In this process, the ethanol is the byproduct because the wheat products alone are worth more than the ethanol," Chilian says. There is a "substantial advantage" to using wheat because it has several high-value coproducts.
An important aspect of the Metalore business plan is its newly-patented "debranning" technology that shaves off and separates the seven outer layers of a wheat kernel. Separating the outer two layers, which contain up to 80 per cent dietary fibre, will allow Metalore to produce a fibre-rich product. - BT
© copyright 1997 Agriculture Publishing Company Limited.
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Gearing up for gas
Most of the ethanol produced from the Commercial Alcohols plant will end up in cars, trucks and tractors across the province.Sunoco Inc. has been anticipating increased ethanol supply for several years and will purchase most of the corn-derived additive to supply its own stations as well as United Petroleum Inc. (UPI) and Pioneer outlets.
Sunoco currently offers ethanol-blended fuel at 75 of its stations across the province, and is expected to make the product available at 270 of its stations in 1998.
"UPI will have ethanol-blended gasoline everywhere," says UPI president and CEO Robert Sicard. "Right now, we use five million litres of ethanol. Within a year, we'll be using 16 million litres and that's without increasing our customer base," he says.
UPI will now be able to add ethanol to gas delivered to both farm and commercial clients. Sicard says his company can also increase the amount of ethanol blended with its gas from between five and six per cent to eight per cent.
Currently, 50 per cent of the gas UPI sells contains ethanol. "In the next 12 months all of the gasolines that I sell will be ethanol blends," Sicard says. - BT
© copyright 1997 Agriculture Publishing Company Limited.
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