Drought forces ethanol firms to look elsewhere for corn.

The ripple effect of this summer's drought has reached ethanol production in Illinois.  The state produces about 1.5 billion gallons every year.  But now production in Illinois and across the nation is down 11 percent since June.  At least one plant, a dry mill facility in Pekin, has ceased operations temporarily as a result of higher corn prices and smaller yields.  A second plant in Granite City was off-line for a few months earlier this year.  As the drought progressed during the summer months, the price of corn jumped from about $5.00 per bushel up to more than $8.00.  Dave Loos, technology and business development director for the Illinois Corn Growers Association and the Illinois Corn Marketing Board, said the drought is the latest hurdle for the 13 Illinois ethanol plants - including one in Gibson City - already competing with each other for market share.  At the One Earth Energy ethanol plant in Gibson City the most pressing challenge this fall was finding the 36 million bushels of corn it needs to produce up to 100 million gallons of ethanol each year.  Starch in corn is a main component in creating ethanol, an alcohol-based alternative fuel that is blended with gasoline to increase octane levels and lessen harmful emissions.  Normally, One Earth sources its corn supply from elevators withing a 60 - mile radius.  This year the company had to purchase corn from Minnesota, which cost more to transport, said general manager Steve Kelly.  He declined to say how much more the company paid in transportation cost for corn from Minnesota.  Some nearby elevators, though, were able to supply the expected amount of corn.  Alliance Grain Co., a grain elevator company based in Gibson City, shipped its normal amount of corn to One Earth, one of several ethanol facilities it sells corn to in Central Illinois.  "The ethanol plant that we market to hasn't slowed down: it hasn't  impacted us," said Joe Thompson, general manager for Alliance, adding that up to 80 percent of the grain processed at Alliance is shipped to Central Illinois facilities that produce ethanol of other products.  Steve Dennis, grain department manager for Evergreen FS elevators agreed.  "The higher (corn) prices put a squeeze on the ethanol industry and that has a domino effect,"said Dennis.  "But we are in a sweet market.  We source to Aventine (ethanol plant in Pekin), One Earth and ADM in Decatur.  We sell a fair amount into ethanol."  Kelly said quality of corn grown in Central Illinois was another challenge this year.  "The quality of the corp that's been grown under stress is diminished," said Kelly.  "The plant doesn't  produce the same amount of starch: the potential isn't as good as we expect."  Aflatoxin, a green mold that prliferates under dry conditions, has become another source of concern, said Kelly.  The mold can be deadly to livestock when high levels are present in corn feed.  In order to safe-guard against the mold, One Earth with 49 full time employees, ha performed a lot more testing for the mold in grain.  But some of Kelly's concerns were offset by a surge in prices for the dried distiller grain, a byproduct of the ethanol plant that is used as feed for livestock.  Its price rose from $213 per ton in fall 2011 to $260 per ton this year.  That helped mitigate higher transportation costs, he said.  Bob Deneen, president and CEO for the Renewable Fuels Association, said while corn yields in Illinois and across the country were down, other countries saw record yields and are now benefiting.  Canada, Mexico and Argentina wer among the contries that saw bigger exports of thier corn into the U.S. market for ethanol plants and other industries that use corn, said Deneen.  'Central Illinois was one of the areas hardes hit and it wouldn't  surprise me in they (ethanol plants) have to source from a wider radius," said Deneen.  "But while this was a very  difficult year for corn in the U.S., around the globe it was a better year."  Overall, ethanol plants have become more efficient during the last few years, making it easier for them to adjust to changes in the market place, said Loos.  "When they get to a point when they are losing money, they can shut down temporarily and we/ve seen quite a few plants (shut) in 2012." said Loos.  Fred Hoyt, associate professor of business adminitration at Illinois Wesleyan university, saidthe looming question facing the industry is whether the area will receive enough rainfall to recover.  The overall ecomomy in Central Illinois suffers when companies have to stock corn from outside the area, said Hoyt.  "The serious question is whether this is a blip or a long-term trend," said Hoyt.  "The recovery depends on what happens in the future and the future is unforeseeable."  Thompson said one thing is certain.  "We need a good crop next year, that's for sure, " he said.

This article appeared in the Pantagraph  on December 16, 2012 and was written by  Karina Gonzalez.

On Thursday, November 15, 2012 One Earth Energy held a Mock Emergency Drill with members of the Gibson City Fire Protection District,Gibson Area Hospital Ambulance Service and the Gibson City Police Department.  The drill simulated an ammonia leak that affected two employees along with plant operations.According to  plant manager, Steve Kelly, a lift came down on a pipe carrying the ammonia, broke the pipe, causing a rupture in the line releasing ammonia into the atmosphere.  A briefing room was set up in the main office of the ethanol plant where five agencies were on the radio, outlining various procedures and precautions that needed to be taken in the drill.  Plant Manager Steve Kelly explained how the ethanol plant has included many safety precautions and measures to be included in its own facility to meet needs such as this mock drill. Plant Manager Steve Kelly said the plant has enough foam stored on site to fight an alcohol fire in the event that should ever happen.  The foam is stored in 10, 55 gallon drums on site.  The plant manager said some of his employees have taken hazmat training and know what to do in situations such as this one.  Once the area was made safe by the Gibson City Firefighters, employees rescued the victim from the lift and proceeded to wash him off with water.  He was then placed in the ambulance and taken to Gibson Area Hospital for further decontamination.  Plant Manager Kelly said the ethanol plant employs 49 full-time employees.  The plant produces 2.1 million gallons of ethanol a week.  Two percent of that product is taken out by truck while the remaining 98 percent is hauled by rail.  On a good day, the plant can handle 300 trucks a day delivering corn to the site.  In reflecting on the mock drill, Kelly said these types of exercises are important for everyone as it helps to keep them up on their skills in the event of a "real" disaster at the plant.

Article curtesy of Doris Benter at the Gibson City Courier

Note: Kent Daniels our Safety Manager put in many hours to get this mock drill completed, and he has done a wonderful job!

Corn Oil Extraction effective January 2012

GIBSON CITY, IL - One Earth Energy announced today that it received the Thoroughbred Chemical Safety Award for 2009 from Norfolk Southern in recognition of their safe handling of hazardous chemical products.

Given annually for 14 years, the award is earned by a company or facility that ships more than 1,000 carloads of hazardous material without incident for the year. One Earth Energy is among 38 corporations and eight plants that attained this achievement. In 2009, One Earth Energy shipped 1,671 hazardous carloads that safely traveled over 1.2 million miles.

"We are pleased to recognize these valued customers for their outstanding industry leadership in chemical safety," said Norfolk Southern CEO Wick Moorman. "By their unrelenting commitment to safe practices, they demonstrate on a daily basis the value of rail transportation as the safest, most reliable way to move their product. We salute these customers for partnering with us to make safety the No. 1 priority, and for their efforts to help make Norfolk Southern the safest railroad in North America."

One Earth Energy is a producer of ethanol and distiller's grain located in Gibson City, Illinois. The majority of the ethanol produced at the plant goes to the east coast with the co-product, distillers grain, marketed as feed for livestock.

Norfolk Southern Corporation (NYSE: NSC) is one of the nation's premier transportation companies. Its Norfolk Southern Railway subsidiary operates approximately 21,000 route miles in 22 states and the District of Columbia, serves every major container port in the eastern United States, and provides efficient connections to other rail carriers. Norfolk Southern operates the most extensive intermodal network in the East and is a major transporter of coal and industrial products.