Issues and Opportunities Related to the Production and Marketing of Ethanol By - Products

Fuel ethanol production is one of the fastest growing segments in American agriculture. Currently, there are 83 ethanol plants in production, with an additional 16 ethanol plants under construction. These ethanol plants have production capacity of 4.3 billion gallons of ethanol per year (Renewable Fuels Association, December, 2004). Approximately 40% of fuel ethanol is produced by wet-mills, and these plants produce wet or dried corn gluten feed, corn gluten meal, and corn germ meal as the primary byproducts. Dry-grind ethanol plants represent the fastest growing segment of the fuel ethanol industry in the U.S., and produce the majority (60%) of fuel ethanol. By-products from dry-grind ethanol plants include wet and dry distiller’s grains, wet and dried distiller’s grains with solubles, modified “wet cake” (a blend of wet and dry distiller’s grains), and condensed distiller’s solubles. Of these dry-grind ethanol plant by-products, distiller’s grains with solubles is the predominant by-product being marketed domestically. Several relatively new ethanol plants were designed and built without dryers. As a result, approximately 40% of the distiller’s grains with solubles is marketed as a wet by-product for use in dairy operations and beef cattle feedlots. The remaining 60% of distiller’s grains with solubles is dried (DDGS) and marketed domestically and internationally for use in dairy, beef, swine and poultry feeds. More than 7 million metric tonnes of DDGS will be produced in the year 2005. Some industry experts are predicting that DDGS production will reach 10 to 14 million metric tonnes within the next few years. Corn is the primary grain used in wet mills and dry-grind ethanol plants because of its high fermentable starch content compared to other feedstocks. However, some ethanol plants use sorghum, or blend corn with barley, wheat, or sorghum to make ethanol and distiller’s grains with solubles, depending on geographical location, cost, and availability of these grains relative to corn. The beverage alcohol industry also produces grain by-products in the form of DDGS (whiskey distilleries) or brewer’s grains (beer manufacturing). All of these by-products are nutritionally different from each other and have different economic value in various types of animal and poultry feeds. There are a wide variety of ethanol by-products available to livestock and poultry producers, but they vary in nutrient content, quality, and feeding value.