Dairy farmers pleased with drop in ethanol prices
By Seth Nidever
snidever@HanfordSentinel.com
Ethanol producers facing the current depressed market yearn for the good old days when demand was high.
But dairy producers who watched their feed prices soar during the corn-based ethanol boom are relieved there is less call for the clean-burning fuel additive.
“It hurt the consumer in general because their fuel cost more, their food cost more and it was a totally wrong direction,” said Rod Kamper, whose dairy milks 1,700 cows in Riverdale.
“They really put a monkey wrench in a lot of other things,” Kamper added.
The ethanol explosion of a few years ago — driven by federal clean-air mandates and rising oil prices — made the corn dairy operators’ feed their cows climb to more than $300 a ton.
That, in turn, drove up the price of alternative feeds as people began switching from corn.
Now, the whole situation has changed.
Thirty-five-dollar-a-barrel oil prices make ethanol production — which is questionably efficient at best — unprofitable.
Plans for two ethanol plants in Kings County announced in 2007 have gone into hibernation.
In early 2008, Great Valley Ethanol received a conditional use permit to build a plant in south Hanford.
No building plans have been submitted, said Kathy Cain, city planner.
Great Valley officials could not be reached for comment..
Pacific Ethanol had plans to put a 60 million-gallon-a-year facility on the north side of Kansas Avenue between 11th Avenue and the BNSF railroad tracks, but abruptly withdrew them in March 2007 and hasn’t been heard from since, according to Bill Zumwalt, director of community development for Kings County.
Pacific Ethanol officials also couldn’t be reached for comment. The company suspended operations at its Madera plant earlier this month.
The result of the ethanol woes: corn prices have been cut in half since reaching a high last July, said Joel Karlin, product manager at Western Milling.
Dairy producers say that speculators betting on the ethanol boom helped drive up prices.
“People who are buying corn now need corn,” said Dino Giacomazzi, who runs a dairy east of Hanford.
The current market is making Rod Kamper think more about cellulosic ethanol, which is produced from grasses, wood chips and ruffage.
Since such by products are inferior sources of food for dairy cows, it wouldn’t drive up feed prices the way the demand for corn-based ethanol does, Kamper said.
But the conversion technology is still unproven, and the skittish economy is slowing research into cellulosic biofuel.
The reporter can be reached at 583-2432.
