Monday, February 28, 2011

US Ethanol Production

This post updates some statistics on US ethanol production.

The first graph (below) shows total production of ethanol in the US (almost of all of which is from corn).  The data are from the Renewable Fuels Association - yearly through 2008, then monthly, with Dec 2010 and Jan 2011 being averages of the weekly data for those months:

You can see the steady rise through the eighties and nineties, then the big take off as oil prices shot up in the 2000s and both policy and commercial advantage dictated converting more of the corn crop to ethanol. Things have slowed down a little bit in 2010, but ethanol production is still growing.  We are now approaching a million barrels/day of ethanol production.  However, recall that ethanol only has about 2/3 the energy content of oil products like gasoline, so we are at about 0.6mbd in an energy equivalent basis.  This can be compared to US crude oil production of about 5.3mbd in 2010, and US consumption of about 18.8mbd of oil products in 2009.

The next graph shows the total potential ethanol production if the entire US field corn crop had been converted to ethanol (pale pink - methodology here).  Also shown in the darker tones are the production capacity of ethanol plants in production, and under construction:

Clearly, more and more of the crop is being converted to ethanol.  You can see the big surge of plants under construction during the 2005-2008 oil shock, and how the expansion has slowed down since - however, production has not declined.

Finally, we see the estimated fraction of the corn crop devoted to ethanol (based on actual production data, not plant capacity):

We are now at almost 40% of the crop being devoted to fuel, rather than food.  Furthermore, the fraction still appears to be growing.

Clearly, this has got to be a significant contributor to food prices.  I will try to quantify that a little more in coming posts.


Kamil said...

Does this imply a social unrest in the near future in USA?

Benno said...

Not meaning to be flippant but 900K barrels of ethanol is about what you need to serve all 6.7 billion of a us a drink (skimping a bit). Certainly everyone world-wide over legal US drinking ago could be accommodated, many with a double.

But more seriously....much of that ethanol wouldn't exist without central planning. Almost 1/2 the US corn crop so allocated!

Benno said...

Not meaning to be flippant but 900K barrels of ethanol is about what you need to serve all 6.7 billion of a us a drink (skimping a bit). Certainly everyone world-wide over legal US drinking ago could be accommodated, many with a double.

But more seriously....much of that ethanol wouldn't exist without central planning. Almost 1/2 the US corn crop so allocated!

Black Lizard said...
This comment has been removed by the author.
Black Lizard said...

Regarding food for poor, there is some new stuff going on behind the scenes:

From the Globe and Mail:

Canada ‘in position to be listened to’ in secretive world food-aid talks

WwoofBum said...

What is your take on the EROEI for corn ethanol?

Stuart Staniford said...


I think it's a little above 1. However, it turns out not to be the most interesting question about ethanol. The key issues are it's financial profitability (positive when oil prices are high enough), it's political traction (appeases farm state senators - works as a form of price support for farmers), and it's impact on food prices (the main downside).

KLR said...

Looks like these guys missed their mark back in 2007: Ethanol to take 30 pct of U.S. corn crop in 2012: GAO | Reuters. Their projections didn't take cellulosic into account, if I'm reading the article correctly - it mentions Executive and Legislative branches being gung ho on wood chips etc of course, but nothing stating that the GAO thought cellulosic would take up any slack - the RFA expected "Renewable," "Advanced," and "Celluosic" ethanols to provide 86.84%/13.16%/3.29% of total 2012 production. Dunno why the GAO would get the % of crop so wrong - perhaps they were expecting tech to improve? Or your figures are wrong. What's the source for the % of crop dedicated to ethanol? I used to visit this simple link from the CattleNetwork website but that's three years out of date now. A ticker for the % would be nice, like those widgets that show how much CO2 is in the atmosphere.

This bit from Reuters says projection for the marketing year that begins - began? - Sept 1, is 5 billion bushels out of 13.73, i.e. 36.4%. Your graph suggests ca. 38% for 2010, so there's a slight discrepancy here.

KLR said...

Reuters article from the 25th: U.S. has foot on the gas on ethanol: Vilsack | Reuters.

Greg said...

The joys of extrapolation: the slope of the log of the "first graph", i.e., the continuous growth rate, is 11.334%.

If in 2010 36% of the corn crop was used for ethanol, and growth continues on trend, we reach 100% of the crop in 2019 - 2020. (Whether it's 36% or 38% doesn't change this result significantly.)

This gives us 2.27 million barrels per day (volume of ethanol - in energy terms, much less than the same volume of oil).

Corn production would need to quadruple in 13 years after that to maintain the rate of growth.

Of course, none of this will happen. The corn price will rise and ethanol demand will fall. Increasing the subsidies can put off the adjustment, but not for long.

In the mean while, we are getting a demonstration of how the market system supplies demand, not need.


KLR - Robert Rapier (i-r-squared) has written several times about the failed promise of cellulosic ethanol. Gasification of cellulosic biomass followed by Fischer-Tropsch to produce diesel looks much more viable, IIRC. I haven't bookmarked anything relevant, but I'm sure you'll be able to find plenty of commentary on cellulosic ethanol on Robert's blog.


I encourage any reader who hasn't done so to read Stuart's post on "The Oil Drum" in 2008, "Fermenting the Food Supply - Revisited".

This chart from that post shows the problem in a nutshell. Scary! (In fact, I had a nightmare about that chart. But I'm strange that way.)

Greg said...

Reading the Reuters article that KLR links to above, one thing sticks out, some attempted reassurance that we can have our corn and ferment it too:

"This year's corn crop is projected for a record 13.73 billion bushels, up 10 percent from last year."

As I said in my comment above, ethanol production has been growing at 11.3% continuous (that's 12% year-on-year) over the period 1980-2010.

What I didn't say above is that the rate seems to have increased, possibly due to higher oil prices. The 1997-2010 growth rate is about 18.8% continuous, equal to 20.7% year-on-year. That is the trend.

How reassuring is that "corn crop up 10 percent from last year" now?

KLR said...

The RFS says "Renewable" biofuel is set to plateau at 15 billion bushels in 2015, up from 12 billion for 2010, so in theory it won't be a problem. In theory. We max out at ca. 45-50% of the total.

My hunch has always been that in a pinch we'll relax tarrifs and import progressively greater amounts of sugar cane ethanol from the tropics; last year the EPA or Dept of Ag or whoever changed the definition of Advanced Biofuel to include cane ethanol, reinforcing my ill informed speculation. It only makes sense, from a purely economic standpoint that is. From an ethical or sustainability standpoint it's quite grotesque.

I see we're at record low reserves (surpluses) of corn, too.

Plan is for 2.5 times as much cellulosic this year. Is that 2.5 * 0 = 0? ;) Wonder if anyone's still around to dump grass clippings into retorts.

Yves said...

What is the current status regarding subsidies for corn ethanol in the US ?