The U.S. animal agriculture industries began 2004 with the cloud of a positive bovine spongiform encephalopathy (BSE) case. This fueled export repercussions for both meat and animal by-products and triggered reaction by numerous regulatory agencies, all of which are not yet finalized. These uncertainties as always precipitated discussions as to the alternative utilizations of animal by-product ingredients to include both protein and fats. These alternatives always include their use as energy sources. Fortunately, the year ended with the confirmation of nearly all past risk assessment studies that document that if BSE is present in the United States, it is at an extremely low incidence. As of this writing, the intensified surveillance program has resulted in over 160,000 examinations of high-risk bovine animals since June 2004 without a single confirmed case. Further, the risk of amplification, due to the “firewalls” implemented in North America since 1986, is also at an extremely low probability. Thus there was no major domestic need to amplify the usage of animal by-products as fuel sources for energy except for the continuing opportunity that biodiesel and biofuel possesses for the fats and oils industries.
There were instances in Canada in which animal protein ingredients were used as solid fuel sources. The recent Canadian government proposed regulation that bans animal specified risk materials from livestock feed, pet food, and fertilizer (see “Canada Proposes Further Feed Controls, page 24) will require alternative processing for these tissues that will undoubtedly require systems for combustion. The Canadian regulation, when finalized, as well as the results of the advanced notice of proposed rulemaking by the United States, provides concern for a pretty amazing 2005.
It may seem that the relationships of BSE and biodiesel are extremely remote, but first we must be reminded that both are extremely important issues to America’s agriculture industry and the economic stability of the country. Bioenergy, biofuels, and biodiesel are terms that only recently have begun to appear in dictionaries. All are now commonly referenced words and much more emphasis in both research and policy is being placed on the resources of agriculture-derived feedstocks.
Bioenergy is a term now commonly used to differentiate those energy sources derived from organic matter that is available on a renewable or recurring basis. Renewable is in contrast to the petroleum-derived or fossil-formed energy sources that are not readily replenished when extracted and combusted. The persistent challenges the United States and the world have experienced in meeting the ever-increasing demand for energy have brought a new meaning to bioenergy. Biodiesel has been an emerging bioenergy resource contributed by the fats and oils industry. During the last decade, biodiesel has grown from a concept into a recognized commercial industry with expanding production capabilities, an infrastructure in which the universal availability of biodiesel pumps is becoming reality, and its accepted importance in policy, legislation, and tax incentives are increasingly evident. Biodiesel has been merged into an enterprise very similar and compatible with ethanol.
Probably most notable of all biofuels is that of ethanol produced primarily from corn although other grains and biomass can be used for its production. The success that ethanol has acquired during nearly three decades has been phenomenal. The industry produced more than 3.3 billion gallons last year. This volume was an increase from the 2.81 billion gallons in 2003 and exemplifies the annual exponential recent growth of the industry. Production is expected to exceed four billion gallons in 2005. The actual number of ethanol producing facilities is debatable, but up to 84 are reported with 14 plants cited as being under current construction. The industry now utilizes over one billion bushels of domestic corn, which represents approximately 15 percent of annual production. It has been projected that the addition of 10 percent ethanol in all of the gasoline used in the United States annually would require 50 percent of the corn crop for the required fermentation processes.
The dry milling process for producing ethanol results in the production of distillers dried grains with solubles (DDGS). Similarly, the wet milling process results in the by-products of corn gluten feed, corn gluten meal, and corn germ meal. Though these by-products are somewhat different in their nutrient composition, they are all used primarily by the feed industry for livestock and poultry production. Thus they are all competitive feed ingredient sources to the animal protein and soybean meal ingredients. Industry experts have projected that seven million metric tons of DDGS will be produced and available for livestock and poultry feeds in 2005, double the amount produced in the year 2000. The significance of these facts is the emerging interactions that the bioenergy production sources is having and will continue to have on animal agriculture.
Biodiesel is not immune to these interactions. Biodiesel is defined as a monoalkyl ester of long-chain fatty acids that are derived from animal fats, vegetable oils, or recycled cooking oils/restaurant grease. The most commonly referenced feedstock has been soybean oil but production technology is currently available to utilize a variety of fats and oils and even a blend of such in producing quality biodiesel. Thus there must be a synergism among the feedstock resources for the industry to sustain its momentum. The current U.S. total production of fats and oils is approximately 35.5 billion pounds. Approximately two-thirds is derived from plant sources of which soy oil represents approximately 75 percent (18.4 billion pounds) and the remaining one-third is derived from animal or recycled fats and oils. For the biodiesel industry, soy oil is essentially a by-product of producing soybean meal of which nearly 85 percent is used for livestock, poultry, and other animal protein feed ingredients. Therefore the interdependence among the North American biofuel feedstocks becomes even clearer, but the potential competition for a place in the market exists on both the feed ingredient side of the equation as well as feedstock sources for bioenergy.
Currently the principle market for ethanol by-products is animal feed ingredients. Ruminant rations have been targeted in the past but research efforts to position their use in swine and poultry is abundant. The dry ethanol milling process, which is becoming the predominant process, concentrates the protein, fat, and minerals by approximately three times that contained in the corn grain, placing its nutrient content into a real competitive position with soybean meal and animal by-products. The plant-derived feed ingredients of both soybean and corn production still relies predominantly on the animal production industries for the disappearance of their commodities. It is that circle of interrelationship that will either foster the continued growth of both ethanol and biodiesel or conversely self-serving interests can create road-blocks that hamper the realization for the potential that all agriculture derived biofuels could provide.
The relationship circle extends well beyond the boundaries of the United States and even North America, as the global market for feedstocks as well as biofuels must be considered. Certainly there has been great change in the soybean complex. The trend is evident that primary production and processing of soybeans is shifting from North America to South America. Soy oil production in the United States has doubled in the past decade, but during that same period South America has increased their production to the extent it now exceeds that of North America by some 18 percent. The world market is still dominated by soy oil, accounting for 82 percent of total vegetable oil, but palm oil is rapidly catching up. The palm oil demand has been driven by both competing with tallow in animal feeds as well as oleo chemical uses and with soy oil on the basis of its alleged health benefits of being lower in transfatty acids.
The current unresolved threat of soybean rust throughout the world is also an influence to monitor. Just as the adversaries immediately challenged the health threats for the use of tallow as biofuel feedstocks because of BSE, inquires as to the potential for the fungal infections of soybeans having associative health effects on its oil and meal have also been received. Research has been published to arrest any relationships of BSE with biodiesel and the probability of any concerns for soybean rust interactions with biodiesel seems extremely remote. But the marketplace, both domestic and global, is abundant with features and benefits that are not founded on scientific documentation but intended to influence demand and trade.
Biodiesel is on the move. The infrastructure is developing rapidly. It has the recognition of the policy and legislative bodies. It has the image and the appropriate reasons for being the right thing to do. Society has an almost universal belief that our country cannot continue its dependence on foreign oil sources. The concern for the need to protect our environment for our children and grandchildren is evident. As a result, the timing is right for biodiesel attention and expansion.
During this past decade, the rendering industry has accepted the challenge to be an integral force in committing to biodiesel commercialization. Today there are numerous renderers both in the United States and Canada producing biodiesel and several more with facilities in planning or under construction. The rendering industry has cooperated with the primary organizations and technology resources in research and development of quality fuel production and distribution. The Fats and Proteins Research Foundation (FPRF) has been an inaugural member of the Soydiesel Development Board, which later became the National Biodiesel Board (NBB) in 1992. Currently, a number of FPRF members are also members, directors, and officers of NBB. FPRF has likewise developed an excellent and cooperative relationship with the Biodiesel Association of Canada. The foundation and Clemson University are participating in a biodiesel safety and environmental impact study conducted by Advanced Technologies and Fuels Canada, Inc. A report on the project is scheduled for the first quarter of 2005. The rendering industry, as the primary collector and processor of used cooking oils and greases, is a major supplier of feedstock to biofuel facilities.
Biodiesel will be a most important part of the energy solutions for the United States. Rendered sourced feedstocks and the rendering industry will be a major contributor in bringing biodiesel as a routine component of all diesel fuels in the next decade. Biodiesel is on the move but biodiesel will require the resources and the harmonization of the entire agriculture community in meeting the demands that new alternative fuels must endure.
Tech Topics - February 2005 Render