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Renewable Energy Inservice Feed Potential of Biofuels Co-Products

Renewable Energy Inservice Feed Potential of Biofuels Co-Products. Harold Harpster Dairy and Animal Science Penn State. “DEALING” WITH $ 4 CORN and $10 BEANS !.

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Renewable Energy Inservice Feed Potential of Biofuels Co-Products

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  1. Renewable Energy Inservice Feed Potential of Biofuels Co-Products Harold Harpster Dairy and Animal Science Penn State

  2. “DEALING” WITH $ 4 CORN and $10 BEANS !

  3. The following is a completeupdated listing of cheap, easily managed alternativesfor corn for your livestock rations….

  4. Table 2. Comparison of Grain and Meals from Oilseeds. Grain Soybean Canola Sunflower Expected yield, lbs/acre 3000 3500 2500 Analysis, DM basis, % Crude Prot 39.2 20.5 19.2 Fat 19.2 40.5 41.9 TDN 101.0 127.5 122.0 Meal Soybean Canola Sunflower Analysis, DM basis, % Crude Prot 53.8 37.8 28.4 Fat 1.1 5.4 1.4 TDN 81.4 69.9 59.9 Lysine 3.32 2.14 1.27

  5. EVERYBODY IS TALKIN ABOUT CORN!! FROM • “ There won’t be any corn left to feed livestock”!! TO “ Half these new ethanol plants will be broke within 5 years” !!

  6. Economics are changing FAST!! YearDDGCorn Jan 2006 $122 /T $2.30 Jan 2007 $146/T $4.20 Oct 2007 $150- $ 4.00 $200

  7. Feedstuff • November 5, 2007 • “Tight Ethanol Margins Expected to Continue” • “Industry in “cooling off” period” • “Construction/expansion pullbacks” • “More ethanol supply then blender capacity”

  8. “35 billion gallons of alternative fuels in the next 10 years..”

  9. Ethanol?The original concept was really good….

  10. Now this is high tech !!! ( Probably got bottled !! )

  11. First US Study Distillers Grains fed to Cattle 1907!

  12. Dry Distillers YearMillion Tons 1998 1 2006 10 2010 16

  13. USE LEVELS

  14. Corn Distillers Grains Maximum Inclusion Levels* (% of DM) Beef 10-20 Dairy 20-25 Poultry 10-15 Swine 20-50 (gestation) Sheep 10-20 * See handout for more details

  15. CONCERNS Nutrient Composition

  16. Remember, when corn is fermented the starch is used and other nutrients are CONCENTRATED • Crude Protein- a good thing at proper levels • Fat -ruminants tolerate a total of about 7% • Phosphorus – Can lead to urinary calculi in males and land application problems in manure (nutrient management plans)

  17. Table 1. Comparison of Corn Grain and Corn Distillers Grains. Corn Distillers Analysis, DM basis, %Corn GrainGrain with Solubles Starch 70.0 4.0 Crude Prot 9.4 30.0 NDF 9.5 40.0 Phos 0.3 0.8 Fat 4.2 12.0 TDN 88.7 79.5

  18. CONCERNS Variability !

  19. DDGS varies in nutrient content and digestibility, color, and particle size among US sources

  20. Variation in DDGS Nutrient Composition* MeanAvg CVRange in CV Crude Prot 30.2 6.4 2.1-10.2 Fat 10.9 7.8 4.4-10.5 NDF 42.1 14.3 2.4-23.1 P 0.89 11.7 3.1-15.3 *12 samples; 10 distilleries. JAS 2002 80:2638

  21. DDGS Variability-Possible Solutions • Minimize excessive drying/heating • Dryer temperatures range from 260° F to 1100° F • Reduces amino acid digestibility • Develop and implement standardized production procedures for all plants within the company

  22. DDGS Variablity-Possible Solutions • Use defined quality criteria for screening corn • Minimize the number of corn varieties used • Blend a consistent amount of solubles with grains

  23. CONCERNS Handling Characteristics

  24. Flowability of DDGS

  25. Flowability of DDGS • Some sources of DDGS do not consistently flow through transport and feed handling systems • Problems worse in summer • Problem worse with higher moisture DDGS

  26. General Management: Wet Distillers • Within 100 miles of source • 1-2 week life “unprotected” • Bag it • Add preservatives • Ensile with other feeds

  27. CONCERNS Anti-Quality Factors

  28. Problems with DDGS • Mycotoxins • Main concerns • Aflatoxins-carcinogenic, regulated by FDA • Vomitoxin (DON)-feed refusal • Fumonisin-carcinogenic • Zearalenone-reproductive problems

  29. Problems with DDGS • Mycotoxins • If contaminated corn is used, mycotoxins are concentrated 3X in DDGS • ELISA tests for mycotoxins may give false positive results • Use HPLC for accurate quantification

  30. Problems with DDGS • Sulfur Content • Sulfur levels • Range from 0.31-1.93% • Variation partially due to use of sulfuric acid to clean fermenters

  31. Problems with DDGS • Sulfur Content • Sulfur levels • High levels of sulfur in DDGS with high dietary inclusion rate, high S forages/water • polioencephalmalacia in cattle • Affect on feed intake and palatability of DDGS at high levels

  32. ECONOMICS

  33. Distillers Grains Value • A specific least-cost formulation for a specific feeding situation always best • Shortcut based on ground corn grain and soybean meal: • Breakeven price of DDGS ($/ton) =(corn ($/bu) x 17.85) + • (SBM ($/ton) x 0.5)

  34. Distillers Grains Value (Oct 31 Chicago) Example: Corn grain- $3.62/bu SBM (48)- $271/T (3.62 x 17.85) + (271 x 0.5)= 200.12 - Breakeven 133/T - Market

  35. Wet Distiller’s Value? Start with DDG value and discount for: a. Dry Matter- Ex: wet= 35% dry=88 35/88=0.398 b. Nutrient Comp. - Avg 98% of dry value c. Shrink - Avg 0.85 d. Storage costs - Avg $5/T Source-Distillers Grains 2007 OSU

  36. Wet Distillers (200.12 x 0.398 x 0.98 x 0.85) - $5= $61.35/ ton delivered

  37. “Livestock producers shouldn’t expect cheap distillers as potential increases may occur to keep ethanol producers in the black” (as corn prices  and ethanol prices ).

  38. Distillers grains becoming more important in ethanol profit margins Current Dec. ’07 Dec.’08 Prices1 futures prices2 futures prices3 $/gal Ethanol returns 1.72 1.58 1.63 Distillers grains returns 0.38 0.34 0.39 Total returns 2.09 1.91 2.02 Feedstock variable costs 1.12 1.12 1.30 Other variable costs 0.62 0.62 0.65 Total variable costs 1.74 1.74 1.95 Returns over variable costs 0.36 0.17 0.07 1 Current prices based on $3.02/bu. Average corn prices in Iowa and $120 per ton distillers grains price. 2 December 2007 futures adjusted for Iowa basis implies $3.02/bu 3 December 2008 futures adjusted for Iowa basis implies $3.51/bu Feedstuffs, 2007 79:46:28

  39. Corn Distillers Grains for Cattle • Advantages • Dietary Inclusion Levels • Nutritive Value • Breakeven Pricing • Cautions • See Handout

  40. $$$$

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