Add a Pinch of Sugar, Rice, and Wheat to Your Tank

April 1, 2008

WASHINGTON (Apr. 1, 2008)—In April 2002—as Congress was struggling to pass a farm bill-CNN ran a story about high oil prices.

Oil futures in New York were $27.38 a barrel at the time of this story, which proclaimed, “[T]he impact of rising wholesale prices since September has already spilled over at the pumps…there appears to be little let-up for consumers.”

Fast forward to April 2008. Congress is again grappling with a farm bill and CNN’s predictions are coming true. Oil prices now hover near the $110-a-barrel price.

This sudden run-up in oil price has hit all Americans in the wallet. From the farmer who pays more to produce our food and clothes to the soccer mom who forks over more to get the kids to and from practice, oil costs have helped bring the U.S. economy to the brink of a recession.

President Bush pinpointed the problem during his 2006 State of the Union speech. “America is addicted to oil, which is often imported from unstable parts of the world,” he said.

As part of his plan to curb this addiction, the President announced increased support for a ethanol production in America, not just from corn, but cellulosic ethanol made from agricultural wastes and other feedstocks.

The agricultural community has been leading efforts to expand the selection of feedstocks for the ethanol industry for a number of years. For example, some in the wheat industry invested in studies to learn how to turn wheat straw-the stuff left over after harvest-into fuel.

Partnering with the National Renewable Energy Lab and IOGEN, a Canadian firm that makes cellulosic ethanol in a demonstration-sized facility in Ottawa, wheat growers in Idaho have worked to attract a cellulosic ethanol plant to their area. IOGEN hopes to break ground there soon.

And wheat is not alone. The rice industry and sugarcane industry are also taking a long look at using crop byproducts to power vehicles.

“Raw sugar prices have remained relatively flat for 23 years, while our input costs are soaring. We’ve got to figure out how to increase the farmer’s per acre return if we have any hope of surviving,” explained Louisiana sugar farmer Mike Robichaux.

He said sugarcane growers are currently exploring how to generate energy from post-harvest residue and from cane stalks after the sugar has been extracted.

“If we’re ever going to break our foreign oil addiction, it’s going to take the collective efforts of farmers from numerous crops, not just corn,” said Gerald Tumbleson, a corn grower from Sherburn, Minnesota. “Ethanol from cellulose will be key to that effort and corn ethanol will continue to bridge the gap until we get there.”

Exactly when cellulosic ethanol will be ready on a large scale is still uncertain.

“We’re not quite there yet, but we are on the cusp of something really great,” explained Duane Grant, an Idaho wheat farmer who was at the forefront of the industry’s cellulosic ethanol endeavors. “We just need a little push to get over the finish line.”

That’s exactly what Congress hopes to give the budding cellulosic industry in the new farm bill.

The bill includes proposals to provide funding for biomass research, establish a production tax credit for cellulosic ethanol and create incentives to produce, store, and transport new bio-based ethanol feedstocks.

But, as Grant pointed out, the farm bill is currently stalled, and many fear the bill will die unless Congress acts soon.

“This is a lot more than a farm bill; it’s a fuel bill and it’s critically important to the future of this country,” said Grant. “It should be Congress’ top priority when they return from Easter recess.”