Consumer Energy Report is now Energy Trends Insider -- Read More »

By Robert Rapier on Jun 6, 2011 with 42 responses

Taking Care of the Topsoil

Following my inclusion in the Top 10 list of ethanol enemies, I sought to Set the Ethanol Record Straight on my actual views on ethanol. I set out three broad tenets that shape my views. They are:

  1. Tenet One: We must transition from fossil fuels with a sense of urgency.
  2. Tenet Two: We need to develop systems and services with a much lower fossil fuel dependency.
  3. Tenet Three: We must take care of our topsoil.

The second and third tenets are where I usually run afoul of ethanol supporters, because I feel many of our ethanol policies simply maintain a high level of fossil fuel dependency. Further, the rush to turn corn into gold has led to practices that have depleted topsoil and aquifiers.

But my desire has never been to kill off the U.S. ethanol industry. To the contrary, I would like to see it grow along with the rest of the renewable energy sector, but grow in a way that is long-term sustainable, self-sufficient, and enhances U.S. energy security. That means producing and using ethanol as energy efficiently as possible, and taking care of the natural resources — like topsoil — that are required for ethanol production.

POET, the world’s largest ethanol producer, is engaged in an effort called “Project LIBERTY,” which plans to use biomass left over from corn production — corn cobs, leaves, husks, and stalks — to produce cellulosic ethanol. Of course biomass removed from the soil has the potential to negatively impact soil quality, so they have been conducting a study with researchers from Iowa State University and the USDA to examine potential changes in soil quality as some of the cellulosic corn by-products are harvested.

Here is an extended excerpt from their press release reporting on the study:

Data shows responsible biomass harvesting is part of good soil management

EMMETSBURG, IOWA (June 1, 2011) – POET’s contracted biomass removal rates with area farmers are conservative and consistent with good soil management, updated site data gathered by Iowa State University and USDA researchers indicate.

Iowa State University has completed analysis on data from the third year of an ongoing study for POET near Emmetsburg, Iowa to monitor how soil health is affected when crop residue is removed. POET’s planned 25 million-gallon-per-year cellulosic ethanol plant, dubbed “Project LIBERTY,” will use corn cobs, leaves, husks and some stalk to produce renewable fuel.

The newest data confirms previous assertions that removing about 1 bone-dry ton per acre (which is about 25 percent of the area’s above-ground crop residue) will not cause significant nutrient loss. In fact, corn yields continued to show no yield loss or moderate increases in fields with this rate of biomass removal.

“Based on this study, we conclude that 1½ to 2 tons/acre of corn stover can safely be harvested” from fields similar to those used in the study, according to the research summary prepared by Dr. Douglas L. Karlen with USDA-Agricultural Research Service and Dr. Stuart Birrell with Iowa State University. Appropriate removal rates will vary depending on how productive the soil is in a specific area.

The data also showed no significant difference in soil carbon after three years. That research will continue as well, including an analysis of deep core samples.

POET sent me the press release, which I found quite interesting and especially relevant to my core belief of taking care of the soil. So I followed up with a few questions, which they graciously answered. My e-mail to them:

I think this is good work; the kind of work that will blunt the sorts of criticisms you will encounter. However, I do have one question. I have frequently heard that we have overfertilized the soil over the years, leading to perhaps more than enough residual nitrogen. If that is the case, excess biomass might be removed for some period of time before yields started to decline. The press release says that there was no significant change in soil carbon. What about nitrogen? I presume this was monitored closely. Given that the recommendations don’t include nitrogen, I am assuming that nitrogen levels weren’t declining. But can you confirm?

I am also wondering whether soil erosion was monitored. That is another frequent criticism of corn ethanol in general, but will become a more significant issue as more biomass is removed.

And their response back to me from Matt Merritt, POET’s Media Relations Specialist:

Robert,

I think your question can be answered in the research summary. Here’s an excerpt:

“The middle three columns (Table 4) show the average additional amount of N-P-K that is removed when the stover is harvested. The important information from this data is that although there is an increase in nutrient removal when stover is harvested, the grain is still the predominant removal mechanism for N and P. For K, however, stover removal roughly doubles the amount of K removed and this will cause the soil test K values to fall if they are not monitored routinely. Finally, the last two columns in Table 4 show that soil-test values for P and K, when averaged across all treatments and years, did decline. We conclude that these soil-test changes confirm that higher rates of fertilizer should have been applied and that the decline in soil-test was caused more by soil variation across the field than by the stover harvest treatments.”



The recommendation was that no significant increase was needed for Nitrogen or Phosphorus (beyond normal fertilizing rates). Potassium was about 15 lb per acre additional replacement for these fields. If you look at the table, you see that the stover has significantly less Nitrogen per pound than the grain. That was for at our removal rate. At some of the higher removal rates, more N was required.

Dr. Karlen said they actually might have been too conservative on fertilizing the fields in general; there was a year-to-year decline in all nutrients for the conventional field and the biomass-harvested fields, which is addressed in those last two sentences.

As for erosion control, that’s not the limiting factor in how much biomass can be removed, from what they’ve told us. The photo I attached shows that there’s still a lot of material on the field after biomass harvest.

POET is to be commended for doing this work. The last thing we want to do is to replace unsustainable fuel sources with other unsustainable fuel sources. I think everyone would agree that fuel that results in degradation of the topsoil is not a desirable source. Thus, research should certainly be done to determine the potential impact of biomass harvesting on soil quality — and act upon those findings as necessary.

But I don’t believe that sustainable corn ethanol has to be an oxymoron, any more than I believe that sustainable forestry is an oxymoron. I have this conversation frequently about forestry; there are good practices and bad practices. We have to weed out the bad practices and encourage the good practices. Forestry can be used to decimate a landscape and erode away the soil, or it can be used responsibly to arrest erosion and actually improve the soil quality over time. Studies similar to the one POET is undertaking have shown the way toward better forestry management.

No matter the source of our energy, there are going to be trade-offs. There is no perfect energy solution. But as we strive to replace fossil fuels, we must avoid trading one set of problems for another that is as bad or worse. The way to do that is to continue to do the sort of work that POET has reported on here.

Additional Resources

Stover Harvest Report – Summary by Dr. Douglas Karlen and Dr. Stuart Birrell for POET of three-year soil data from Emmetsburg, Iowa

Biomass Baling – A slide show recap of the learning process for farmers during the first large-scale biomass harvest in Emmetsburg, Iowa

  1. By Bioblogger on June 6, 2011 at 11:23 am

    Anyone who thinks you are an “enemy of ethanol” don’t like to have their prejudices challenged. You make me think and I appreciate that.

    For the sake of the economic sustainability and global energy security we need biofuels, including ethanol, because they give us options that decrease our dependence on oil, build local markets, and provide choices at the point of consumer purchase.

    As a cellulosic ethanol proponent – which has been much slower to develop than originally projected – I regard corn ethanol in the U.S. to be like sugarcane ethanol in Brazil. For all its warts, it is doing a good job of enabling the building of demand, infrastructure, standards, best practices, and FFV vehicles for a multiple fuel market. Gotta have chickens if you want the eggs.

    For the sake of environmental sustainability we need to take a good look at the cultivation, aggregation, production, distribution, and emissions of the alternatives. One reason we find fossil fuels such a large component of the production of biofuels is we’ve never had reasonable alternatives! I think POET is finding ways to change that in addition to the soil studies and Project Liberty you cite.

    Regarding forestry, your readers might like to read a recent USDA Forest Service study that finds that industrial timber use can make forestry MORE economical and sustainable ( http://bit.ly/lkjdAM ). Some of these findings sound counter-intuitive but the reality is that use of a resource increases the vested interest in it and provides the capital to better research and manage it. It also protects it from being regarded as lower value. For instance, in spite of best intentions to “preserve and protect” soil or timberlands, if unused they then become uneconomical to manage it could result in their being lost to catastrophe (wildfire, bug infestations, wind erosion, etc.) or, more permanently, sold off to housing developers.

    [link]      
  2. By Rufus on June 6, 2011 at 1:15 pm

    Good job, Robert. You did good. :)

    [link]      
  3. By Steve Funk on June 6, 2011 at 1:15 pm

    A basic organic gardening principle to maintain soil fertility is that you should maintain roughly a 30 to 1 carbon to nitrogen ration. Carbon is the basic building block for humus. Nitrogen facilitates its transformation from raw organic matter to humus. The big problem with removing the stalks is the carbon removal, not the nitrogen removal.

    [link]      
  4. By Rufus on June 6, 2011 at 3:38 pm

    Due to horrific drought, ;and harvests all around the globe last year, corn is selling at close to record highs, and yet Wholesale Ethanol (before the blender’s credit is applied) on the CBOT is still selling for $0.35/gal less than wholesale gasoline.

    http://news.ncgapremium.com/in…..subtype=25

    By the time corn gets back to a more reasonable $4.50/bu, or so, by this fall ethanol will, likely, be selling for over a Dollar (unsubsidized) less than gasoline.

    It’s very likely that the Oil Exporters will never again be able to price gasoline less than ethanol.

    [link]      
  5. By paul-n on June 6, 2011 at 5:07 pm

    Well, it’s good to see such a measured approach from POET here.

     

    On the topic of potassium removal, there must be some ash/residue from their cellulosic process, which would contain the K and some of the P and N.  Assuming it is not used as animal feed, this could go back the fields from whence it came.

     

    Steve Funk is on the money about soil carbon – if you have decreasing levels, then you are losing fertility, regardless of other nutrient levels.  If you remove too much biomass and leave the soil exposed to direct sunlight for extended periods, the soil bacteria go into overdrive and start eating the humus (after they have eaten everything else) – you may end up with decreasing soil carbon, even though you are not “removing” anything.  

     

     

    [link]      
  6. By thomas398 on June 6, 2011 at 2:39 pm

    Its generally agreed that peak corn ethanol is an E20 to E30 mandate or about a third of the nation’s cars on E85.  The use of diesel fuel in the production and nationwide distribution of ethanol lowers its impact on oil imports. Combine this with the ability of oil exporters to keep the price of oil just below that of corn ethanol (and the consumer’s preference to choose the cheapest fuel), and it becomes clear this is more about farming (USDA) and less about energy.   Corn ethanol has never been nor will  it ever be a viable consumer fuel alternative to gasoline.  This is simple “bring home the bacon” politics. Let’s cut the subsidies and give consumers choice at the pump (including E0).   We will see the real demand for ethanol.

    [link]      
  7. By mac on June 6, 2011 at 3:05 pm

    Dirt ! The Movie (2009).

    Here is an Interesting, even fascinating look at the “skin of the earth”, it’s importance to us and what sometimes happens when we don’t take care of the “dirt under our feet.” Narrated by Jamie Lee Curtis. 1 hr 20 min.

    http://www.hulu.com/watch/1916…..-the-movie

    Movie trailer for Dirt!
    http://www.youtube.com/watch?v…..8_dN5YWnyc

    [link]      
  8. By thomas398 on June 6, 2011 at 7:05 pm

    Rufus said:

    Due to horrific drought, ;and harvests all around the globe last year, corn is selling at close to record highs, and yet Wholesale Ethanol (before the blender’s credit is applied) on the CBOT is still selling for $0.35/gal less than wholesale gasoline.

    http://news.ncgapremium.com/in…..subtype=25

    By the time corn gets back to a more reasonable $4.50/bu, or so, by this fall ethanol will, likely, be selling for over a Dollar (unsubsidized) less than gasoline.

    It’s very likely that the Oil Exporters will never again be able to price gasoline less than ethanol.


     
     Rufus:
    That would break the long term trend.  See http://e85prices.com/.  Ethanol prices have tracked ,in good years and bad, those of gasoline.  Remember, everyone in the ethanol supply chain wants to sell their product for the highest price the market will bear.   But at any price its not a national solution.  We’re still taking the height of a horse jockey.

    [link]      
  9. By Rufus on June 6, 2011 at 8:01 pm

    The good news is: Corn is a C4 Plant. It fixes Carbon.

    Also, I think I read somewhere that something like 90% of the corn plant is below the surface. So when you take a 1/3 of the above ground plant you’re taking a very small percentage of the plant as a whole.

    http://users.rcn.com/jkimball……lants.html

    [link]      
  10. By walter-sobchak on June 6, 2011 at 11:32 pm

    Poets are the unacknowledged legislators of the world.

    “A Defence of Poetry” by Percy Bysshe Shelley

    ==========================================

    “Build Soil: A Political Pastoral” by Robert Frost

    Let none assume to till the land but farmers.
    I only speak to you as one of them.
    You shall go to your run-out mountain farm,
    Poor castaway of commerce, and so live
    That none shall ever see you come to market–
    Not for a long, long time. Plant, breed, produce,
    But what you raise or grow, why, feed it out,
    Eat it or plow it under where it stands,
    To build the soil. For what is more accursed
    Than an impoverished soil, pale and metallic?
    What cries more to our kind for sympathy?
    I’ll make a compact with you, Meliboeus,
    To match you deed for deed and plan for plan.
    Friends crowd around me with their five-year plans
    That Soviet Russia has made fashionable.
    You come to me and I’ll unfold to you
    A five-year plan I call so not because
    It takes ten years or so to carry out,
    Rather because it took five years at least
    To think it out. Come close, let us conspire–
    In self-restraint, if in restraint of trade.
    You will go to your run-out mountain farm
    And do what I command you. I take care
    To command only what you meant to do
    Anyway. That is my style of dictator.
    Build soil. Turn the farm in upon itself
    Until it can contain itself no more,
    But sweating-full, drips wine and oil a little.

    “A Defence of Poetry” by Percy Bysshe Shelley
    Poets are:
    The hierophants of an unapprehended inspiration;
    The mirrors of the gigantic shadows which futurity casts upon the present;
    The words which express what they understand not;
    The trumpets which sing to battle, and feel not what they inspire;
    The influence which is moved not, but moves.
    Poets are the unacknowledged legislators of the world.

    [link]      
  11. By paul-n on June 7, 2011 at 2:57 am

    Rufus,

    The 90% figure is nowhere near reality – except perhaps if you are talking about potatoes or the like.

    It will come as no surprise to find that there have been lots of (government funded) studies about corn growing, and the root mass, called the root:shoot ratio.

    This paper about corn and other crops in the midwest explains it in far more detail than you will eveer want to know, but can be summarised as;

    the ratio of corn grain to total above ground biomass, the “harvest index”  is averages 0.53:1, but can be higher for some varieties.

    The ratio of below to above ground biomass is about 0.17

     

    So for every ton of corn produced, there will be about 0.9 tons of stalks and cobs, and about 0.33 tons of root biomass. 

    But most of the biomass that gets left behind, gets “eaten” by soil bacteria, and typically only 5-10% goes into soil organic carbon (SOC).

    A very good rough indicator of soil fertility, and water holding capacity is the SOC –  if you don’t have much of it  - all you have is dirt!

     

     

     

    [link]      
  12. By DGH on June 7, 2011 at 6:30 am

    The missing question is what can be done with the waste product left over from turning corn stover into ethanol.

     Can it be treated and mixed into compost or fertilizer or do the chemicals make it unusable.

     If it can the loss of chemicals becomes negligible.

    [link]      
  13. By Kit P on June 7, 2011 at 8:12 am

    “Poets are the unacknowledged legislators of the world. ”

     

    Apparently not very good sailors.

     

    “This paper about corn and other crops in the midwest explains ”

     

     

    “We studied crop harvested yield, as recorded in national agricultural statistics,”

     

    Yes, another debate about Midwest farming by people who are not either farmers or from the Midwest.

     

    “A very good rough indicator of soil fertility, and water holding capacity is the SOC –  if you don’t have much of it  - all you have is dirt! ”

     

    If all you have is dirt, then soil erosion becomes a major environmental problem. You may want to try to explain this to farmers Paul. Be prepared to get an earful. Every farmer that I have know can explain how they farm to reduce the environmental impact of natural geological forces.

     

    “Can it be treated and mixed into compost or fertilizer or do the chemicals make it unusable. ”

     

    Anaerobic digester make a fine organic fertilizer and produce biogas which can be used to provide process heat and electricity for ethanol plants. Such good and proven engineering processes are capital intensive. Incentives need to be proved to switch from coal or NG.

     

    “If it can the loss of chemicals becomes negligible. ”

     

    Thus reducing the environmental impact of farming and making chemicals.

    [link]      
  14. By Matt Merritt on June 7, 2011 at 9:24 am

    Just want to mention this from the info, relayed in the article:

    “The data also showed no significant difference in soil carbon after three years. That research will continue as well, including an analysis of deep core samples.”

    [link]      
  15. By Wendell Mercantile on June 7, 2011 at 11:15 am

    The 90% figure is nowhere near reality – except perhaps if you are talking about potatoes or the like.

    Perhaps Rufus has confused corn plants with icebergs.

    [link]      
  16. By Wendell Mercantile on June 7, 2011 at 11:32 am

    Very nice essay RR. Two points to add:

    1. It took nature tens of thousands of years to build up the thick layer of fertile soil that runs through the heartland, and that soil is a natural resource, just as oil, natural gas, and the aquifers. For decades, all but the most enlightened farmers simply “mined” that soil, as one would mine a copper or iron mine.

    Some farmers continue to be “stewards of the soil,” but far too many continue “mining” the soil, as they mine the Ogallala Aquifer.

    2. There is a very good word that describes the health of a soil — tilth. I was expecting to see that word in your essay and surprised to see it didn’t surface.

    [link]      
  17. By Douglas Hvistendahl on June 7, 2011 at 11:59 am

    Anyone near a city, interested in truck gardening, and not afraid to work might look up: “How to grow more vegetables than you ever thought possible on less land than you can imagine.” by John Jeavons. High production gardening – you need to use hand tools but the return per hour spent is as high as that with mechanized truck gardening. Starting cost is much lower. I’ve been using this for about thirty years for my home garden – the soil becomes very rich! For those with grass eating livestock, subscribe to “The Stockman Grass Farmer.” This management intensive grazing increases the carrying capacity of most pastures while building up the soil at the same time.

    Chemicals – this area is phosphate short, but there are forms of phosphate that are effective without the problems of the usual fertilizers. They break down slower, but our pasture roughly quadrupled the blades of grass per square foot in a few years, while carrying more head/acre. There will be other area specific needs. Recycling from POETs plants to replace chemicals makes sense. They seem to be taking their time and doing it right.

    [link]      
  18. By rrapier on June 7, 2011 at 12:59 pm

    Douglas Hvistendahl said:

    Anyone near a city, interested in truck gardening, and not afraid to work might look up: “How to grow more vegetables than you ever thought possible on less land than you can imagine.” by John Jeavons. High production gardening – you need to use hand tools but the return per hour spent is as high as that with mechanized truck gardening. Starting cost is much lower. I’ve been using this for about thirty years for my home garden – the soil becomes very rich!


     

    I have that book, and it made a tremendous impact on how I think about the soil. Jeavons’ techniques are the basis of my own gardens.

    RR

    [link]      
  19. By paul-n on June 7, 2011 at 2:02 pm

    If all you have is dirt, then soil erosion becomes a major environmental problem. You may want to try to explain this to farmers Paul. Be prepared to get an earful. Every farmer that I have know can explain how they farm to reduce the environmental impact of natural geological forces.

    Yes most farmers know this, including this one who grew up on a farm in country that has the lowest SOC soils of any continent on the planet.  However, not everyone who reads this blog is a farmer, or has regular contact with them.

    And I am happy for you that all the farmers you know are good soil stewards, but that does not mean that all the other ones are.

      Consider this USDA map;

     

     

    The dots represent land above the “tolerable erosion rate”, and from the USDA descrioption 

    A total of 108 million acres are eroding excessively resulting in 1.3 billion tons of erosion.

    So, erosion is clearly happening, however, the rates of erosion, and the areas of land affected by it, have been decreasing over recent decades, due to improved land management, like no till farming methods, and the Conservation Reserve Program.

    The fact that the CRP exists shows that not all farmers were  managing their soil properly.

     

    [link]      
  20. By Rufus on June 7, 2011 at 2:55 pm

    Yeah, I was probably remembering something I read about switchgrass, or miscanthus. Good info, Paul; thanks.

    [link]      
  21. By Wendell Mercantile on June 7, 2011 at 4:22 pm

    Rufus~

    How is the tilth of the soil in Tunica County? I’m still puzzled that the the counties in the Delta can have such fertile soil, but yet be continually considered as some of the poorest counties in the United States.

    Does the Delta have stewards of the soil, or have they been “mining” the soil of its nutrients for too long?

    [link]      
  22. By Rufus on June 7, 2011 at 4:58 pm

    Wendell, the Delta is “river-made” land. Well, the levees were built a long time ago, and the river ain’t doing much “making’ anymore. The dirt’s okay, but it’s not Iowa. You need a big operation, with big equipment to make it work. Big equipment doesn’t need many “workers.”

    There are still a lot of low-skill, poorly-educated people “hanging on” down here. Many of them are of the “older” variety.

    BTW, it’s mostly cotton, and soybeans (some rice over on the East side) in Tunica County. However, I’m seeing a Lot of Corn this year. I passed a field, yesterday, that, I swear, was up to my belly button (I’m 6’3″.)

    [link]      
  23. By Wendell Mercantile on June 7, 2011 at 5:15 pm

    Well, the levees were built a long time ago, and the river ain’t doing much “making’ anymore.

    Ah, the rivers play a role in making soil fertile. Who’d a thunk it? I thought the Egyptians figured that out 4,000 years ago when they looked forward to the annual flooding of the Nile to give life to their soil and increase yields. (A lesson they then forgot when they built the Aswan Dam, which is causing the Nile to silt up.)

    One of the unintended side benefits of opening the Morganza spillway into the Atchafalaya basin a few weeks ago is that it will restore soil nutrients.

    Perhaps they need to let the Delta flood once in awhile instead of just dumping on synthetically-produced fertilizers.

    How much chemical fertilizer, pesticides, and fungicides does that bean farmer close to you use each year?

    By the way: How’s the well water in the Delta? When I lived in Mississippi, I remember it didn’t taste very good.

    [link]      
  24. By Rufus on June 7, 2011 at 5:23 pm

    He uses just as much as he needs to. Just like those farmers in Iowa.

    Some iron. Some sulfur. All the good stuff. :)

    [link]      
  25. By Rufus on June 7, 2011 at 6:39 pm

    People overlook that Agriculture/Forestry/Fishing/Hunting are only 3.5% of Iowa’s Gross State Product.

    On the other hand Manufacturing is 22.9% of Iowa’s economy.

    http://en.wikipedia.org/wiki/F…..s_2006.jpg

    A state must have a diversified economy to be successful. “Farming,” alone, isn’t enough.

    [link]      
  26. By Wendell Mercantile on June 7, 2011 at 11:54 pm

    A state must have a diversified economy to be successful. “Farming,” alone, isn’t enough.

    Why doesn’t Mississippi have a more diversified economy? Casinos and farming aren’t enough. All you really have is the shipyard at Pascagoula and a handful of military bases.

    Is the lack of diversification still a carryover from King Cotton and the slave era?

    [link]      
  27. By Rufus on June 8, 2011 at 12:52 am

    It’s just a backward state, Wendell. I suppose it’s a bit of a carryover from the “Plantation” era.

    [link]      
  28. By Mark on June 8, 2011 at 8:49 am

    Sugar cane harvesting removes the whole top of the plant from those tropical soils. Where’s the evidence of a big problem with that? Concerns with corn stover removal is just another example of alarmism. Corn for silage provides a ready model for corn stover removal, as do stover for fodder. No problems with that.

    Stover can be harvested in the spring after the potassium has leached out and the hemicellulose has degraded naturally.

    [link]      
  29. By takchess on June 8, 2011 at 11:22 am

    a book recommendation that you may enjoy and he argues against some of the techniques in intensive farming (jeavons book ) as overkill. I’m reading it now and find it very interesting. Hows that for timing. 8)

    http://books.google.com/books/…..ohaJCxFnAC

    [link]      
  30. By rrapier on June 8, 2011 at 12:39 pm

    Mark said:

    Sugar cane harvesting removes the whole top of the plant from those tropical soils. Where’s the evidence of a big problem with that?


     

    That situation has been studied as well. Sugarcane doesn’t pull as many nutrients out of the soil (hence is less fertilizer intensive than is corn).

    I disagree that it is alarmism. It is something that has to be studied, unless we are prepared to look back later and say “Oops, we really screwed that up.” As the POET study indicates, the potassium levels have to be managed. The only way to know that is by doing these sorts of studies, or by learning the hard way as yields plummet.

    RR

    [link]      
  31. By OD on June 8, 2011 at 2:01 pm

    CNBC just all but said peak oil might be here ‘production might be the highest it can go and prices will just keep going up’, uh-oh.

    RR – what is your take on the OPEC meeting? Apparently it was pretty horrible.

    [link]      
  32. By mac on June 8, 2011 at 2:40 pm

    Takchess and RR,

    Thanks for bringing up the subject of the soil, gardening and so on. A bit of relief from constantly fretting about “what’s coming next” on the energy front. Also enjoyed Sobchak’s poems from two pretty good poets, Frost and Shelly. Perhaps Robert should include a few quotes from Shakespeare in his essays from time to time. (Just kidding, Robert)

    [link]      
  33. By biocrude on June 8, 2011 at 6:21 pm

    Obama administration is about to blow it.  This is not what the SPR is for…  From OPIS today:

     

    2011-06-08 02:15:51 EDT

    ***WHITE HOUSE REITERATES THAT SPR COULD BE TAPPED IF
    OPEC DISAPPOINTS

       The White House
    confirmed today that President Obama is still mulling whether tapping the
    strategic petroleum reserves might be necessary if worldwide demand and tight
    supply leads to higher prices.

     

       White House
    Press Secretary Jay Carney told reporters that “We believe we are in a
    situation where supply is not reaching demand,” and reiterated that lots
    of options, including tapping the SPR are under consideration. The comments
    came on a day where OPEC met, and left in disarray with no formal production
    increases within a sharply divided cartel.

     

      NYMEX crude oil
    futures backed off substantially from morning highs, thanks in part to the
    White House comments, but also in reaction to reports that some OPEC members
    would hike output and ignore ceilings. July WTI at one point flirted with $102
    bbl but the contract was at $100.49 bbl, up $1.40 bbl with some fifteen minutes
    left in the trading day. Volume was especially brisk with

    400,000 July contracts exchanging hands by press time.
    Brent crude was up just 84cts bbl at $117.62 bbl late in the trading day.

     

       Refined products didn’t get the same intraday
    lift, and RBOB futures looked like they would close lower. July RBOB was down
    1.19cts gal at $2.98 gal with a short span left in the formal session.

    [link]      
  34. By rrapier on June 8, 2011 at 9:06 pm

    OD said:

    CNBC just all but said peak oil might be here ‘production might be the highest it can go and prices will just keep going up’, uh-oh.

    RR – what is your take on the OPEC meeting? Apparently it was pretty horrible.


     

    OPEC is going to slowly strangle us if we let them. Saudi is losing control to Iran and Venezuela. Not good for the U.S.

    [link]      
  35. By rrapier on June 8, 2011 at 9:44 pm

    Biocrude said:

    Obama administration is about to blow it.  This is not what the SPR is for…  From OPIS today:

     

    2011-06-08 02:15:51 EDT

    ***WHITE HOUSE REITERATES THAT SPR COULD BE TAPPED IF

    OPEC DISAPPOINTS


     

    I continue to wonder about Ed Markey’s sanity. In a story today:

    “OPEC, led by Iran and Venezuela, has snubbed its nose at the United States and the rest of the Western nations addicted to OPEC oil,” Markey, the top Democrat on the Natural Resources Committee, said in a release.

    And how does he propose to address that addiction? By feeding it:

    U.S. Representative Edward Markey, a key Democrat, said the United States must prepare to use national emergency oil reserves after the Organization of the Petroleum Exporting Countries decided on Wednesday to not boost crude production.

    [link]      
  36. By Wendell Mercantile on June 8, 2011 at 11:16 pm

    Obama administration is about to blow it. This is not what the SPR is for…

    Biocrude~

    Correct, the SPR is for when the oil stops flowing — not as a way to manipulate market prices.

    But I imagine the White House is starting to run scared thinking about the 2012 election, and is no longer thinking rationally when it comes to the economy and the effect oil prices might have.

    [link]      
  37. By paul-n on June 9, 2011 at 1:07 am

    Maybe I haver missed this minor detail discussions about the SPR, but assuming they do this as a market response (as opposed to some military thing) whom, specifically does the gov “release” to, and at what price?

    If they sell it at less than market price, how do they ensure the oil co’s don’t just sell it at market price and pocket the difference?

    If they auction it off, as would seem to be the best option, the bid prices would likely be close to the market price.

     

    Is this an oil version of “quantitative easing”?  should it be called “lubrication”

    [link]      
  38. By Mark on June 9, 2011 at 6:19 am

    That situation has been studied as well. Sugarcane doesn’t pull as many nutrients out of the soil (hence is less fertilizer intensive than is corn).

    The important nutrient is the carbon. The cane is the equivalent of stover. Well-managed corn for silage, where the whole plant top is harvested, provides a ready model for stover removal. Ethanol production does not consume the NPK in the stover but rather processes it into a ready fetilizer. Future processes will most likely capture the nutrient values as actual feedstuffs, with the animal manures being returned to the fields, just as vinasse and some manure is returned to sugarcane fields.

    As for carbon values, cover crops, fertilizer crops and rotations including perennials such as alfalfa can be used. State of the art rural bioenergy calls for state of the art agriculture methods already being used by some farms.

    [link]      
  39. By OD on June 9, 2011 at 1:31 pm

    I don’t think they’ll tap the SPR. It seems they always threaten to, in hopes of spooking the market into lower prices. Sort of like when central banks put out the word they’ll raise interest rates, but never do. We’ll see.

    [link]      
  40. By Wendell Mercantile on June 9, 2011 at 1:42 pm

    I don’t think they’ll tap the SPR.

    Would be folly if they did.  We’d just fritter away the oil we’ve been building up in the SPR for no good purpose. It’s there for an emergency — a real emergency.

    [link]      
  41. By russ-finley on June 25, 2011 at 11:20 am

    How does one stop a farmer from maximizing profit by selling as much subsidized stover as he can and replacing it with higher levels of fossil fuel based fertilizer? In the end, the problem usually boils down to economic incentives.

    [link]      
  42. By paul-n on June 25, 2011 at 3:17 pm

    I don’t think you can – you have to rely on the farmer being a good steward of their soil.

     

    Unfortunately, with the increase in corporate and leased land farming, the far away management of the company is tryiong to maximise this year’s earnings, and aren;t too concerned about long term viability – it is very easy for them to mine the soil.

    One way might be to make sure there is no bailout mechanism for this situation, but then you might end up with depleted, abandoned land being eroded etc.

    No easy answer to this one.

    [link]      
Register or log in now to save your comments and get priority moderation!