WHERE DOES ILLINOIS CORN GO?

If you’ve driven through Illinois, you’ll remember fields and fields of corn along our (sometimes dilapidated) scenic interstates and highways.  It’s true, corn is a very popular crop in our state and one that supports the Illinois economy in many ways.

For a moment, let’s review that the corn you see growing in Illinois is not sweet corn.  Sweet corn, bred for its sugar content, is the corn you enjoy off the grill, out of a can, or frozen from the grocery store.  But this corn makes up less than 1% of the corn grown in Illinois.  Most of the corn is field corn or dent corn, bred for its starch content, and used to make corn meal (rarely), to feed livestock, and to fuel our vehicles.

So where does all this corn grown in Illinois go?

Well, according to the best available data we have on the 2016 crop – data from the 2017 crop isn’t finalized yet – most of that corn is exported out of Illinois and likely used to feed livestock.

To be fair, we can’t know exactly what the corn is used for once it leaves our state, but we do know that 41% of the corn grown in Illinois is exported.

Why is export the largest market in our state?  Because we have a unique position on the Illinois and Mississippi River that gives us very competitive access to transportation to get that corn out of the country.  Buyers and get our corn delivered to them more cheaply, so they tend to buy from us instead of from other states.

If a semi load of corn in Illinois isn’t leaving the state, it’s probably being used for ethanol production.  Thirty-one percent of the corn grown in 2016 ended up at an ethanol plant and became the cleanest burning fuel option American’s have.

Interesting to note, much of the ethanol produced in Illinois also leaves the state for other countries.  Those rivers, man!  They are a BIG advantage.

The rest of the corn is used for processing (23 percent) and livestock feed (5 percent).  Livestock feed is an easy one to understand.  Five percent of the corn grown in Illinois is fed to livestock living in Illinois.

But this 23 percent processing number is more complex.  It basically includes everything else that we use corn for.  This is where the human food use for field corn is (cornmeal, tortillas), but also where all the industrial uses are lumped.  Corn is used to make diapers, gum, lollypops, crayons, and many, many more products!  So many that 23 percent of Illinois corn goes into those markets.

Here’s the shocker though – fifteen percent of the corn harvest in Illinois is sitting unused in a pile or in a bin somewhere.  We grow more corn than we can use!  This is why we are always looking for innovative ways to incorporate corn into our lifestyles to make our products better.  And this extremely versatile crop delivers!!

Lindsay Mitchel
ICMB/ICGA Marketing Director

ETHANOL & YOUR CAR: A PRIMER

Have you ever stopped to think about the science that goes behind the gasoline that drives your car? If you’re anything like me- gears, engines, and any sort of chemistry don’t make the slightest bit of sense. When I go to the gas station, I swipe my card to get my ‘fuel points’, then always get the gas that is the cheapest. But, I’ve never really sat and thought about what makes up gasoline. How does this make my car run?

We’ll start simple. Corn is fermented to create a gasoline mixture. This is called ethanol. Most gasoline is made of 10% ethanol, and the majority of US cars can run on this amount. But, some cars are now being produced that can run on 100% ethanol fuel, which is better for the environment and uses less energy. Ethanol is a renewable source, unlike regular gasoline.

PEMBROKE PINES, FL – NOVEMBER 15: Gas pumps with a sign indicating the gas is containing up to 10 % ethanol are seen at Victory gas station on November 15, 2013 in Pembroke Pines, Florida. Today, the federal Environmental Protection Agency announced a proposal to ease an annual requirement for ethanol in gasoline. (Photo by Joe Raedle/Getty Images)

Ethanol is also known to have high amounts of octane. Octane is the power that makes your car go. The more octane you have, the more power there is for your car to run. Higher blends of ethanol offer more octane for the same amount of money. The Department of Energy states that having higher octane fuels are required for larger engines or ones that use more force.

The oil companies obviously want you to pay the ‘big dollars’ for high-dollar ‘aromatics’, which is a petroleum-based synthetic octane enhancer. They increase the octane, but are extremely harmful to the environment and are very expensive.

But, this is why we have ethanol.

The higher the ethanol content in your gasoline, the higher the amount of octane you have. This increases the power in your car, while also helping the environment. If car manufacturer increases the engine capacity of cars to be able to handle more ethanol content in cars, this can really help our environment. We can stop unnecessary greenhouse gas emissions and increase the efficiency levels in our vehicles.

This only goes to show that agriculture really does “drive” everything forward. Ethanol is cheaper than gasoline, so why not try to produce more vehicles that have the capacity to not only help the environment but help us save some money at the pump every week.

Ashley Hauptman
Illinois State University

ALL WE WANT FOR CHRISTMAS: RVP WAIVER

[Originally posted December 15, 2016]

This Christmas list item gets complicated, so bear with me.

A RVP waiver – Reid Vapor Pressure waiver – is what Americans really need to use more renewable fuels and capitalize on the domestic, clean-burning fuel we have right at our fingertips.

SANTA, BRING THAT WAIVER FOR E15!

The back story on this request is that when it’s really hot, bad stuff (emissions) evaporate from your fuel (evaporative emissions) and can cause summertime air pollution.  The EPA doesn’t want that to happen.

They measure the evaporative emissions using the Reid Vapor Pressure (RVP) standard.  The higher the RVP of a fuel, the worse its emissions are.

The RVP of pure ethanol is 2.  The RVP of gasoline can range from 7 to 15.

But when blended, the RVP of an ethanol/gasoline blend can exceed the RVP standard.  The RVP of a 10% blend of ethanol into gasoline (the standard fuel today) is about 10.

In 1990, Congress amended the Clean Air Act to allow E10 a waiver – in other words, Congress gave EPA the authority to allow the use of E10 during the summer months.  But we’re still waiting on the waiver to allow E15 in the summer months, and the absence of that waiver is what makes E15’s movement into the marketplace so complicated.

By the way, the RVP of E15 is actually lower than E10 and straight gasoline.

So, Santa, I’m not sure if you understood all this, but we could really use that waiver in our hands on Christmas Eve.  The world stands to benefit from cleaner air, and consumers will definitely enjoy the extra cents per gallon in their pockets.

Mitchell_LindsayLindsay Mitchell
ICGA/ICMB Marketing Director

WIN FREE FUEL

You can win free fuel by reporting fuel prices of E85 and other ethanol blends on e85prices.com.

All you have to do is download the app, create an account, and start reporting the prices of the ethanol blended fuel in your area or wherever you find yourself during your scheduled summer driving.  Each time you report a price (you can report multiple prices per day) you are entered to win $50 in free fuel!

Winners are drawn every single day from Memorial Day through Labor Day and announced every two weeks.

For full contest details, click here.

ALL WE WANT FOR CHRISTMAS: RVP WAIVER

christmas-listThis Christmas list item gets complicated, so bear with me.

A RVP waiver – Reid Vapor Pressure waiver – is what Americans really need to use more renewable fuels and capitalize on the domestic, clean burning fuel we have right at our fingertips.

SANTA, BRING THAT WAIVER FOR E15!

The back story on this request is that when it’s really hot, bad stuff (emissions) evaporate from your fuel (evaporative emissions) and can cause summertime air pollution.  The EPA doesn’t want that to happen.

They measure the evaporative emissions using the Reid Vapor Pressure (RVP) standard.  The higher the RVP of a fuel, the worse its emissions are.

The RVP of pure ethanol is 2.  The RVP of gasoline can range from 7 to 15.

But when blended, the RVP of an ethanol/gasoline blend can exceed the RVP standard.  The RVP of a 10% blend of ethanol into gasoline (the standard fuel today) is about 10.

In 1990, Congress amended the Clean Air Act to allow E10 a waiver – in other words, Congress gave EPA the authority to allow the use of E10 during the summer months.  But we’re still waiting on the waiver to allow E15 in the summer months, and the absence of that waiver is what makes E15’s movement into the marketplace so complicated.

By the way, the RVP of E15 is actually lower than E10 and straight gasoline.

So, Santa, I’m not sure if you understood all this, but we could really use that waiver in our hands on Christmas Eve.  The world stands to benefit from cleaner air, and consumers will definitely enjoy the extra cents per gallon in their pockets.

Mitchell_LindsayLindsay Mitchell
ICGA/ICMB Marketing Director

NEW REPORT KNOCKS THE STUFFING OUT OF ‘FOOD VS. FUEL’ TURKEYS

Some interesting data on the correlation between increasing amounts of corn used for ethanol and food prices.  You may remember that corn was blamed for the increase in food prices several years ago and the ag industry responded that food prices were much more tied to fuel prices than commodity corn.  

Turns out, we were right.

New Report Knocks the Stuffing out of ‘Food Vs. Fuel’ Turkeys

Millions of Americans preparing for Thanksgiving next week are undoubtedly noticing that dinner will cost less than it did a year ago. According to the U.S. Department of Agriculture, overall grocery prices are roughly 2% lower than at this time last year, and prices specifically for poultry products — like turkey — are down 1.5% compared to last fall. Meanwhile, the amount of corn used for fuel ethanol is primed to set a new record in 2016, up roughly 3% from last year.

The Renewable Fuels Association (RFA), which released an independent analysis today on the impact of ethanol on food prices, says the current collision of falling food prices and record ethanol production should end the contrived “food vs. fuel” debate once and for all.

The new statistical analysis, conducted by Informa Economics IEG, retrospectively examined the effect of ethanol expansion on food prices, concluding that “…retail food prices were not impacted in any demonstrable way by expansion of U.S. grain ethanol production under the Renewable Fuel Standard (RFS) over the past decade.” In fact, the study finds that food price inflation has actually slowed during the “ethanol era.”

The analysis shows that growth in food prices slowed cons10% ethanoliderably after passage of the RFS2, with prices for groceries advancing at roughly half the rate seen prior to the program’s adoption. “Prior to the passage of RFS2, food away from home [e.g., restaurants] grew at an average of 3.4%, versus 3.2% for food at home [e.g., groceries]. After RFS2, food away from home grew at 2.6%, versus 1.8% for food at home,” the study found. “The increase in the food [consumer price index] actually decelerated as the usage of corn in ethanol production increased dramatically.”

The study also examines the impact of ethanol on corn prices, and in turn the impact of corn prices on retail food items. While the authors conclude that corn prices were positively impacted by ethanol expansion, higher corn prices did not necessarily translate into higher consumer food prices.  “Statistical analysis shows that the link between corn prices and overall food prices has been weak,” according to the report, adding that changes in food prices are primarily driven by “…the costs of transforming farm products to retail grocery products, along with transportation and distribution at various levels of the supply chain.” The analysis shows that only 19% of consumer spending on food pays for the value of the farm commodities, with the remaining 81% paying for “…post-farm-gate activities (e.g., transportation, processing, marketing).”

Other factors that drive farm commodity and retail food prices were examined, with Informa concluding that core inflationary pressures, weather events (e.g., flooding and droughts), exchange rates, and energy prices all impacted commodity and food prices over the past decade. In fact, from 2009 to 2014, the impact of crude oil prices on consumer food price inflation was nearly nine times greater than the impact of corn prices.

View the analysis here.

EVERYTHING YOU WANTED TO KNOW ABOUT CORN IN ILLINOIS

1. Illinois corn farmers are growing field corn, not sweet corn.

I know this is confusing – but 99% of the corn grown in Illinois is not the corn you eat on your dinner table.  That corn is sweet corn, bred for its sugar content so that it tastes so amazing!  The corn we grow in Illinois is field corn (or dent corn) that is bred for starch.

Field corn is a grain.  Sweet corn is a vegetable.

2. Illinois planted 88 million acres of field corn and 555,000 acres of sweet corn.

We also grew 13.6 billion bushels of field corn compared to 137 million bushel equivalents.(Equivalents because sweet corn is weighed still on the cob so we have to remove the cob to make them comparable.)  And the crop value of Illinois field corn is $49 billion – considerably more than sweet corn’s $1.02 billion value.

field-corn-sweet-corn3. The two plants even look completely different in the field.

Sweet corn is shorter, has larger tassels visible, and is often a lighter green.  Field corn is taller, has smaller visible tassels, and is darker green.  We harvest sweet corn in the milk stage in the middle of summer.  We harvest field corn in the fall when the plant starts to die and the corn kernels dry up.

4. Illinois is in the top five states in ag cash income and crop cash receipts.

In English, this is code for the Illinois economy is built on ag.  It’s one of our top industries.  Illinois is the number 2 corn producer (behind Iowa), the number 3 ethanol producer, number 2 in pork production, and the largest exporter of corn in the country!

5. Most of the corn grown in Illinois is exported out of the state.

where-does-corn-goIn Illinois, 47 percent of the corn is exported out of the state.  Of the remaining corn, 27 percent is made into ethanol, 21 percent is used for processing (corn plastic, high fructose corn syrup, etc), and 5 percent is used to feed cows, pigs, and chickens.

Of that 27 percent used for ethanol, 1/3 is sold as a by-product of ethanol production that makes an excellent livestock feed.  So some of the ethanol corn is actually used twice – by the ethanol industry and the animal agriculture industry.

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