Iowa Corn Farmers and Biofuels Producers Missing Out on Massive New Market Until Carbon Sequestration Projects Move Forward
Sustainable aviation fuel (SAF) could grow into the largest new market ever seen for U.S. farm commodities thanks to the start of production of SAF at LanzaJet Freedom Pines Fuels. Without low carbon ethanol, which requires carbon capture and sequestration (CCS), Iowa farmers could miss out on the chance to unlock this new market. No Iowa ethanol plant currently has a carbon intensity score low enough to qualify as a SAF feedstock. Only one plant in the U.S., using CCS, is currently producing SAF-friendly ethanol. By contrast, Brazil produces over 7 billion gallons of ethanol with a carbon score expected to qualify for SAF production.
“Today and every day going forward, American farmers and ethanol producers are losing demand until we get carbon capture and sequestration online,” stated Monte Shaw, Iowa Renewable Fuels Association executive director, who was in Georgia today to witness the LanzaJet grand opening. “LanzaJet is proving that SAF from ethanol is here today. Now it is up to us to produce a qualifying ethanol feedstock. Iowans need to realize that CCS is the key to the new market. Regardless of individual views on carbon policy, our business is making the products our customers want and right now we can’t do that.”
“LanzaJet Freedom Pines Fuels will use a variety of low carbon sustainable ethanol, making this an eye-opening experience to what Iowa corn farmers could expect to be a part of,” said Dan Keitzer, a farmer and Iowa Corn Usage and Production Committee Chair. “However, due to our inability to lower our CI score for ethanol plants here in the state, we will be missing out on a large market for the corn we produce, which is unsettling as we have had larger carryout numbers in recent years.”
The new SAF market is potentially massive according to a new study unveiled today by Decision Innovation Solutions (DIS), Iowa’s premier agricultural economic firm. The study found fully maximizing the potential of the SAF production in Iowa will have a generation impact. To meet the demand, DIS projects that Iowa would build:
- 11 new 200-million-gallon-per-year ethanol plants
- 5 new ethanol-to-jet SAF production facilities
- 3 new facilities that convert soybean oil, fats and greases to SAF.
“The construction and ongoing operations of these facilities hold the promise to fundamentally transform rural Iowa in ways even bigger than the current biofuels industry,” stated David Miller, DIS chief economist and report author. “We have the opportunity to set the stage for the next 25 years when corn production will rise to 20-21 billion bushels per year based on current acres. No other market but SAF can utilize that corn. If we do not embrace low carbon ethanol to unlock SAF, we are likely to lose 20 million acres of corn across the Midwest and the $10 billion in farm income those acres create. What will our legacy be?”
According to the study, while building out the SAF infrastructure will cover many years, the cumulative impact in Iowa will:
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