LANSING, Mich. — More than 200 industry leaders, agri-professional, educators and others joined Michigan’s first ever Bio-Economy Summit to learn about the potential of biotechnology to make Michigan a leader in a high-tech 21st Century economy.

During the two-day conference, Sept. 20-21 at the Lansing Center in downtown Lansing, participants heard about topics ranging from ethanol and biodiesel production and marketing to commercial development opportunities and scientific discussions about the emerging bio-economy sector.

With the nation’s ethanol industry booming, the dramatic increase in corn use for ethanol production has some wondering if there’s enough of the raw product to satisfy all the needs – animal feed, human consumption and export markets as well as ethanol production.

In 2005 the industry produced nearly 4 billion gallons of ethanol – nearly twice the amount produced in 2002. Production in 2005 consumed more than 1.4 billion bushels of corn, or about 13.6 percent of total corn use in the nation. In 2006 ethanol production is expected to hit 5 billion gallons and experts say it will triple by 2015.

National Corn Growers Assoc. CEO Rick Tolman said that corn research and new technology are continuing to increase corn yields, which in turn will help close the gap in demand of corn for ethanol production.

“Ethanol has not caused a corn supply-demand imbalance,” Tolman said.

During the production process, about two-thirds of the corn goes into ethanol while the remaining one-third is a by-product, known as distillers grains, that go back into the animal feed channels.

These distillers grains are expected to increasingly displace corn in beef and dairy rations and eventually in poultry and swine rations. Industry experts project that distillers grains will displace more than 1 billion bushels of corn for feed per year by 2011.

Tolman said continued advances in corn varieties that are resistant to insects and herbicides are giving growers “a plant that’s more resistant to adverse weather conditions,” which lends to “better yields and starch traits.” Both are key for ethanol production.

“There’s a lot of research going into corn that is unlocking all kinds of traits and secrets for the potential of corn,” Tolman said. “This will allow us to expand the industry very dramatically and still have enough corn for our needs.”

In addition to ethanol production, heating with corn is another emerging use for the commodity that is gaining momentum nationally.

The prices of crude oil, natural gas, propane, heating oil and other fuels are “very erratic and steadily increasing,” said Dr. Chris Schilling, Ph.D., professor and chairman of engineering with Saginaw Valley State University. But, he said the potential to save on home and commercial heating expenses is tremendous with flex fuel furnaces that burn corn, cherry pits, wood chips or biomass pellets.

A one-year heating bill comparison presented by Schilling for a 2,000-square-foot home that considered heat content of the fuel, furnace efficiency and fuel prices showed corn as the least expensive option at $521 per year, while electricity topped the scale at $2,550 per year. Other popular choices included propane at $2,138, cordwood at $1,800, heating oil at $1,732 and natural gas at $1,172.

Schilling said a key to success with alternative fuels is to “create markets.” He discussed business opportunities, citing services in Europe that deliver the fuel source and haul away ash.

“People don’t have time or they don’t want to get their hands dirty,” he said.

“How do we make jobs in Michigan? You have to think out of the box in a number of ways,” he said.

Michigan’s agricultural biotechnology sectors currently account for more than $60 billion in economic output and one million jobs annually. New ventures, many related to the bio-economy and especially new facilities to produce renewable fuels, are expected to create $1 billion more in revenue and up to 23,000 more jobs a year. Ethanol production alone has the potential to generate $400 million in annual revenue.

Raw materials from farms also can be used for manufacturing. From paint to plastics and car parts to glass, crops grown by Michigan farmers will be a necessity for future production.

Dr. Mary Beth Stanek, director of strategic initiatives with General Motors, said the automobile industry is working feverishly to promote E85 with its dealers and the public.

A key, she said, is to continue to develop an infrastructure to deliver E85 to consumers.

“We (GM) believe ethanol is powerful because it’s renewable,” Stanek said. “We can really displace a lot of petroleum over time.”

Stanek said GM is working with business and industry leaders to make alternative fuels such as ethanol and biodiesel “accessible” to consumers. She said GM researchers estimate that by 2020 nearly 40 percent of the nation’s dependence on foreign oil could be offset by a shift to bio-fuels.

Education is another key factor in the change. General Motors now offers 17 flex-fuel models, up from nine models just two years ago. To educate consumers, the Big Three automaker equips each vehicle with a bright yellow fuel cap with a reminder that the vehicle will run on ethanol or gasoline.

“Consumers have to know what they’re buying and what to do with it,” she said.

“Thanks to our strong agricultural sector, Michigan is in a great position to become a leader in the new bio-economy,” said Jim Byrum, president of the Michigan Bio-Economy Consortium, a sponsor of the program.

“Agricultural crops are the foundation for new ethanol and biodiesel plants and are helping us produce plastics and other components for the manufacturing sector.

“By working together and embracing these new technologies we can truly turn our agricultural land into major suppliers of raw materials for a 21st Century bio-based economy,” he said.

This farm news was published in the Sept. 27, 2006 issue of Farm World, serving Indiana, Ohio, Illinois, Kentucky, Michigan and Tennessee.