Here is some great info by Red Williams which he recently sent out in his weekly email from SAC inc.

Questions about Ethanol

It was almost inevitable that after the over blown enthusiasm about ethanol that there would be questions raised about its long term place in the economy. There is no doubt it will play an important role into the future but quite possibly it wont be such a huge part of the fuel industry as first imagined and mandated by President Bush.

The food-fuel debate may not be as defining a factor as some suggest but certainly there is a lot of adjusting in much of the grain and grain dependent industries that were not predicted in the early stages. As corn supplies were drained off for fermentation into ethanol the prices increased and acres were diverted from wheat and soy beans. The market spike in grain prices may or may not be sustainable if the building of ethanol plants slows. But in the meantime the beef and pork feeding industries are drowning.

One of my associates predicts that ethanol will continue to be competitive as a gasoline additive, but not as a gasoline replacement. A comment that bears some thought. Another scientist proposed to me that a serious debate is required on the efficiency of growing crops in the temperate zone for fermentation as opposed to being a source of high quality starches and proteins for food and other industrial processes.

As suggested, it is not surprising that many questions would be raised about the simplistic approach of substituting ethanol for gasoline. On the other hand, researchers are busy making improvements in producing ethanol, and also converting it to other energy materials. In the short term ethanol plants will be built, although more slowly than before, and the industry as a whole will take its place as a key value-adding opportunity.

C.M. (Red) Williams, President

Saskatchewan Agrivision Corporation Inc.