INDIANAPOLIS, Ind. — Four years ago, Indiana had one operating ethanol plant in South Bend, according to Vic Heinold, general manager of DDG (distillers dried grains) and Feed Ingredients for CGB Enterprises in Louisiana; today, he said the state has five running, with five more under construction.<br>
The former Hoosier and state senator spoke briefly on DDGs at the Mid-America Ag Show in Indianapolis earlier this month. Ethanol production is outpacing federal mandates, he said, which will eventually require around 5.5 billion bushels of corn, resulting in 15 billion gallons of DDGs (one-third of a bushel goes to ethanol, he explained, while the protein, fat, amino acids and minerals of corn go into the DDG byproduct).<br>
Heinold said the United States could reach an annual volume of 45 metric tons of DDGs and DDGSs (with solubles) to market in the next few years; approximately one-third of that much is produced now. Domestic consumption of these byproducts as feed, while high in the Midwest and central and southern California, he said, will not be enough to use all that should be produced.<br>
The U.S. Grains Council (USGC) is marketing American-produced DDGs and DDGSs overseas, and Heinold predicted a big climb in exports for 2008 – last year, he said they were just under 2 million metric tons, and are expected to be as high as 5 million this year.
According to the USGC and the Illinois Corn Marketing Board (ICMB), Egypt and Morocco are increasing their imports of U.S. DDGSs. Egypt quintupled its imports in just a year’s time – from 6,400 to 32,200 metric tons in the 2006-07 marketing year – and Morocco is currently importing 54,000 metric tons, with potential to multiply that significantly.<br>
“Illinois DDGS exports topped 1 million tons last year, and this is anticipated to double this year,” said Ron Gray, ICMB chairman. “ICMB is working hard on growing the export market, but also making DDGS more functional for the domestic pork and poultry industry.<br>
In addition, the USGC is trying to promote DDGs as poultry feed for farmers in Iraq and India. India presents a special problem, according to the USGC, because it has a 15 percent import duty, but the council is negotiating with the government to drop the tariff, and with end users to create enough demand for DDGs as feed to encourage abolition of the duty. USGC is also employing outreach and education with other potential customers.<br>
It isn’t just overseas where these groups want to create demand. “As ethanol production expands, DDGS will need to play a bigger role here at home,” Gray said. “ICMB will devote up to $500,000 this year, working in partnership with the livestock industry, to accomplish this task.”<br>