Some say the next generation of corn oil extraction must focus on oil quality and quantity, while maximizing DDGS value and consistency. Others say the time is right for dry fractionation, a capital-intense approach to diversifying ethanol plant product streams. Then there are those who bring to light new Food and Drug Administration regulations that will put extraordinary pressure on ethanol producers, since feed is ultimately food. Even though their agendas and messages were slightly different, one thing all of the speakers in the Coproducts/Product Diversification track at the FEW agreed on is that coproduct enhancement and diversity are critical to survival as a low-cost player in today&rsquo;s trying economical and sociopolitical environments.
Yhanhong Zhang, assistant director with the National Corn-to-Ethanol Research Center, presented survey results on DDGS contaminants. &ldquo;Mycotoxins are unavoidable,&rdquo; she said, &ldquo;they are weather related.&rdquo; Harold Tilstra with Land O&rsquo;Lakes Purina Feed, who spoke on the same panel titled Containing Distillers Grains Contaminants, further explained that some mycotoxins such as aflatoxins are associated with drought conditions while others, such as vomitoxins (also called deoxynivalenols) are brought on by wet weather conditions. Zhang said in 2009 predictions of greater vomitoxins present in corn were on the rise, which initiated interest at NCERC to conduct sample surveys of DDGS at various ethanol plants.
The DDGS survey took place between August 2009 and January 2011, so the corn used came from the 2008-&rsquo;10 growing season. Eight ethanol plants were surveyed every other month during the investigation period. The results showed that aflatoxins were found not to be an issue, but two of the eight plants sampled showed levels of vomitoxins well past the 5 ppm Food and Drug Administration advisory level. The samples showing the highest concentration of vomitoxins were taken during spring 2010, dying down after then. Fumonisin levels at three of the eight ethanol plants surpassed the FDA advisory level of 5 ppm as well. Zhang noted, however, that &ldquo;the plants with high vomitoxins were different than the plants with high fumonisin levels.&rdquo; None of the eight plants tested bimonthly during that period showed detectable levels of T-2 mycotoxins.
Zhang also shared data from DDGS produced with corn from crop years 2005-&rsquo;07. She said 235 samples were taken from 23 dry mill ethanol plants, and the highest aflatoxin levels were at 4 ppb, meaning none were higher than the FDA advisory level. No vomitoxin levels were higher than the advisory level either, but the highest fumonisin levels were at around 8.6 ppm, and 10 percent sampled showed levels of fumonisin greater than the 5 ppm FDA advisory level.
She explained how mycotoxin levels in corn get concentrated in DDGS. To prove it, she took paired samples from two ethanol plants in 14 consecutive days, and monitored the results. Enrichment of contamination in DDGS from mycotoxin-contaminated corn is roughly 3.5 times, she said, stressing that it is imperative to monitor levels of these contaminants in the incoming corn. New Regulations
The Food Safety Modernization Act is changing how ethanol producers do business, shifting focus on just being fuel producers that incidentally make a feed coproduct, to being fuel, and food, producers. &ldquo;Feed is food,&rdquo; said Matt Gibson, ICM Inc.&rsquo;s vice president of feed. Gibson directed anyone in the audience who wishes to learn more about the FSMA to search Public Law 111-353. The main points of the new regulation are to improve the capacity of ethanol producers to prevent problems, and to detect and respond to problems. &ldquo;It&rsquo;s not just about recalls or inspections,&rdquo; Gibson said. It&rsquo;s about a prevention mandate, and those who are noncompliant will be held accountable. Ethanol producers must register under the act beginning in 2012, and every other year thereafter. Having a Hazard Analysis and Critical Control Point plan &ldquo;is a big part of this,&rdquo; he said, and it needs to be implemented by July 4, 2012.
The FDA &ldquo;shall assess and collect&rdquo; for re-inspections, he emphasized. The frequency of facility inspections is based on risk, higher or lower, and Gibson noted that feed producers like ethanol plants are considered lower risk, but cooperation with the FDA is paramount.
&ldquo;There is whistleblower protection clearly in the law,&rdquo; he added. &ldquo;What does all this mean for me? In my opinion, you and I, and everybody, must be proactive. There&rsquo;s a big liability associated with this. Compliance must become SOP (standard operating procedure).&rdquo;
He advised ethanol producers to be on the lookout for new rules, and cautioned that all inputs must be feed grade or better. &ldquo;Assistance is available,&rdquo; Gibson said. Good Inputs, Good Outputs
Tara Vigil, a chemical process engineer with Katzen International, who spoke on the same panel as Gibson, uttered those same words: &ldquo;Feed is food.&rdquo; She said &ldquo;too many chemicals in your plant can destroy your coproduct,&rdquo; and rallied the audience of ethanol producers to &ldquo;make a better feed that ultimately ends up on your table.&rdquo;
&ldquo;Coproducts make the margin,&rdquo; she said, meaning a plant&rsquo;s profitability, or lack thereof, is often determined by the distillers grains sales. She highlighted the often-discussed drawbacks of distillers grains: inconsistency in moisture, fiber, grain size, fat content, sulfur and more. &ldquo;There&rsquo;s room for improvement,&rdquo; she said. &ldquo;The standard deviation is very great, and it can land on either side of the average, making a huge range.&rdquo;
What is done upstream affects results downstream. &ldquo;You get out what you put in,&rdquo; she said, &ldquo;or better yet, you don&rsquo;t get out what you don&rsquo;t put in.&rdquo; She also reminded the audience that, just like feedstock, chemicals and yeast, &ldquo;operations is another input.&rdquo;
She detailed how design of an ethanol plant&rsquo;s milling, piping, equipment, automation, cooling, dryer designs and DDG handling all have profound effects on distillers grains quality. Milling is important as it determines particle distribution in the plant and the size of material in DDGS, so a plant needs the right hammers, screens and so forth to optimize particle size. The right piping can minimize chemical inputs, reduce or eliminate sulfur and minimize caustic consumption. &ldquo;No dead legs,&rdquo; she said, meaning a plant shouldn&rsquo;t have any areas in its configuration of piping where mash sits and doesn&rsquo;t move, for that only leads to a place where bacteria and sugar concentrate, which have to be mitigated with chemicals. Also, Vigil pointed out that something as simple as pipe welds can have a big impact on bacteria growth. &ldquo;Smooth welds give no place for bacteria to grow,&rdquo; as opposed to jagged welds with pockets for bacteria infiltration. She said heat exchangers should be designed with biology in mind so they can be easily drained. Higher temperature cooking can help kill bacteria that would otherwise get recycled through the backset, and if the bacteria is minimized or eliminated through high-temperature cooking, so too is the need for antibiotics. Automation can greatly increase a plant&rsquo;s consistency.
Plants also must consider dryer capacity, and a plant may require spare capacity in order to run consistently on a day-to-day basis. &ldquo;Size matters,&rdquo; she said, referring to dryer capacity. &ldquo;Dryers become bottlenecks, so when the drying temperature is raised&rdquo; to push more product through, this adversely affects lysine levels, dropping the presence of the critical amino acid. It also increases VOC emissions. Another point to think about, Vigil told the audience, is that improper cooling leads to product bridging. Backset is good because it decreases the amount of fresh water needed to make ethanol, but it increases viscosity and enzyme usage, and it increases the potential for contamination as well as produces more nonfermentable solids circling around the plant. Vigil cautioned managers to maintain consistent operator schedules. &ldquo;The importance of shift uniformity is key, especially if the plant is not automated.&rdquo; Finally, Vigil noted that the very most important thing to monitor in an ethanol plant is fermentation.&nbsp; Dry Fractionation 
Integration of front-end fractionation technologies has long been discussed as an opportunity for ethanol producers to diversify their product streams and add to their bottom lines, but years of anticipation have given way to little acceptance from dry mill plants at best. Pete Moss, vice president of marketing for Cereal Process Technologies, gives good reasons why this may finally change.
Moss says the 15 billion gallon cap on corn ethanol in RFS2 is one reason fractionation will finally come to the dry mill corn ethanol industry. Corn ethanol plant projects not grandfathered into RFS2 will be forced to incorporate advanced technologies to move forward. The U.S. EPA dictates that advanced ethanol technologies that can be&nbsp; incorporated at dry mills include both corn oil fractionation and back-end extraction, Moss said, and to be considered advanced, the plant must achieve an annual average rate of 1.33 pounds of oil per bushel of corn. &ldquo;By 2022, the technology will be there,&rdquo; he added.
In addition to the 15 billion gallon cap, Moss said the other driving factor that will finally enable ethanol plants to move toward the capital-intense fractionation process involves consolidation in the industry. &ldquo;What we&rsquo;re seeing today is more capable [companies] with bigger balance sheets,&rdquo; he said. Companies with deeper pockets can either absorb the higher capital expenses to outfit a plant with front-end fractionation capacity or finagle investors to shell out the money.
&ldquo;We are moving from being a subsidy-driven industry to being an RFS2-driven industry,&rdquo; Moss said. He added that in order to make this work, some plants will have to &ldquo;team up with others&rdquo; in order to take full advantage of the value, which he said can lead to four times the net income of an ethanol plant producing just fuel, carbon dioxide and distillers grains. Instead, the plant can produce industrial- or food-grade corn oil with low free fatty acids, de-oiled germ, bran, white fiber, fuel, high-protein feed and more. Oil Extraction, Biodiesel 
ICM announced at the FEW it has obtained signed contracts for installation of its patent-pending Advanced Oil System at four plants. The company is calling AOS the next-generation oil extraction system. &ldquo;Most oil extraction providers use a combination of centrifugation and chemical additives to extract corn oil; however, extraction rates can be limited by emulsification,&rdquo; the company stated. AOS uses an emulsion-breaking approach to deliver a much higher conversion rate than is currently possible with first-generation oil recovery technology, and consists of separate skid-mounted units that can be installed at plants without oil extraction technology, or a modified version of the technology can be installed at plants that have already invested in ICM&rsquo;s first-generation oil separation equipment.
Despite ongoing patent infringement litigation, Greenshift Corp.&rsquo;s Chief Technology Officer David Winsness shared the stage with Brock Beach, capital sales manager for oil separation solutions for ICM Inc., one of several litigants in the lawsuit, where the two answered audience questions about their companies&rsquo; differing oil extraction methods. &ldquo;I believe we have the pioneering patent on the extraction process,&rdquo; Winsness said. &ldquo;We don&rsquo;t use a tricanter, we use a disc stack centrifuge. There&rsquo;s more G-force there while consuming less horsepower.&rdquo; Beach responded, saying that ICM uses a tricanter made by Flottweg, another litigant in the patent infringement case, because &ldquo;tricanters are designed for heavy solids,&rdquo; and the material will ultimately &ldquo;spend less time in a tricanter&rdquo; than in a disc stack centrifuge. On the unit&rsquo;s power, Beach said, &ldquo;We don&rsquo;t see the need for more G-force.&rdquo;
Winsness said at 30 cents a pound, extracting a half pound a bushel, a 110 MMgy ethanol plant that processes 20 million bushels can add $6 million to its bottom line. The capital costs for extracting a half-pound per bushel is about $500,000, Winsness said, adding there&rsquo;s a one-year return on that investment.
He acknowledged that removing too much oil from distillers grains can have negative impacts on the quality of the feed supplement and its going rate. &ldquo;If you keep taking out the fat, it will impact the feed,&rdquo; he said, adding to keep the protein-to-fat ratio in mind. &ldquo;For every 3 percent of the oil you remove, you increase the protein by 1 percent.&rdquo;
Joe Riley, general manager of FEC Solutions, said there should be a premium for high-fat distillers grains, so if the demand for inedible corn oil from the biodiesel industry goes away, the markets won&rsquo;t crash and ethanol producers will still be able to retain some of that value. &ldquo;Today there&rsquo;s not much price difference&rdquo; between high-fat and de-oiled DDGS, Riley said. Soybean meal goes for $330 a ton and &ldquo;we should shoot for that,&rdquo; he said, admitting, &ldquo;Yes, the amino acid profile is different.&rdquo;
&ldquo;Find diverse homes for your oil,&rdquo; Riley said. &ldquo;The last thing you want to do is have a load of corn oil come back into your plant.&rdquo; He said the low-hanging fruit at an ethanol plant is still from beer column on, and that the next generation of corn oil extraction will need to focus on oil quality, quantity and, finally, maximizing DDGS quality.
Riley was asked by an audience member if the oil extracted from the backend of ethanol plants is &ldquo;good enough for the biodiesel industry.&rdquo; He responded, &ldquo;There are a number of different biodiesel technologies out there&rdquo; to handle the material. &ldquo;Good enough is difficult to say.&rdquo; Biodiesel producers found the oil to be &ldquo;good enough&rdquo; to make up slightly less than 10 percent of the U.S. feedstock supply in 2010, according to Dave Elsenbast, vice president of supply chain management for Renewable Energy Group Inc. The National Biodiesel Board reports only 315 million gallons of biodiesel was produced in the U.S. last year, so roughly 31 million gallons of U.S. biodiesel manufactured in 2010 were derived from corn oil. He said about 35 percent of U.S. ethanol plants implement corn oil extraction, adding that he expects that number to double within a couple of years.
While use of 31 million gallons of corn oil for biodiesel production is encouraging, Winsness said the U.S. EPA projects 680 million gallons of corn oil will be needed to meet the RFS2&rsquo;s biomass-based diesel targets. He mentioned the 2011 diesel requirement of 800 million gallons, next year&rsquo;s 1 billion gallon mandate, and EPA&rsquo;s proposed volume for 2013, 1.28 billion gallons. &ldquo;We&rsquo;ve got 500 million gallons to make up in three years,&rdquo; Winsness said.
Talk of co-locating biodiesel processing units with ethanol plants has been around since these oil extraction technologies emerged, but the model of selling the oil to offsite users through marketers has dominated the scene. Now Winsness says he thinks a number of ethanol companies will finally come around to processing their corn oil into biodiesel onsite. One big reason is, as he said, &ldquo;There&rsquo;s plenty of opportunity to sell 100 percent of the biodiesel locally.&rdquo; The combined on- and off-road local demand would soak up locally available biodiesel. He said Greenshift has a pending patent application for a blender pump so ethanol producers with biodiesel manufacturing onsite could maximize sales of biodiesel locally, and with the high price of biomass-based diesel RINs and the $1 per gallon federal blenders tax credit in play, they can pass the higher blend savings to the customer locally. &ldquo;The first movers have the advantage here,&rdquo; he said.
&mdash;Ron Kotrba

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DDGS Study: Yhanhong Zhang, assistant director with the National Corn-to-Ethanol Research Center, said mycotoxins are unavoidable, they are weather related.

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SOP Compliance:  Matt Gibson, vice president, feed, for ICM, said with whistleblower protection in place, everyone must be proactive and compliance with regulations must become standard operating procedure. 

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Expanding Revenue Streams: Ethanol producers are keen to learn more about expanding ethanol coproducts beyond DDGS to include corn oil. New synergies with biodiesel are being explored.

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The next generation of corn ethanol coproducts is here

2011 FEW Review - Track 3 Coproducts/Product Diversification: Enhancement & Diversity

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