North Alabama Integrated Poultry And Ethanol Production (IPEP . - BR Bock
North AlabamaIntegrated Poultry and EthanolProduction (IPEP) Feasibility StudyFinal ReportforNRCS Grant Agreement 68-3A75-3-144Prepared by T.R. Miles Technical Consultants, Inc.B.R. Bock Consulting, Inc.September 2006
Feasibility of an Integrated System for Improving the Economicand Environmental Performance of Poultry and EthanolProduction in North AlabamaFinal ReportforNRCS Grant Agreement 68-3A75-3-144September 2006Prime Contractor: Thomas R. MilesT.R. Miles Technical Consultants, Inc1470 SW Woodward WayPortland, OR 97225tmiles@trmiles.comPhone:503-292-0107Fax: 503-292-2919Subcontractors: B.R. Bock Consulting, IncInforma Economics (formerly SparksCompanies)Energy Products of IdahoAuburn University Poultry ScienceDepartmentAlabama Mountains, Rivers and ValleysRC&D Council (formerly Tennessee ValleyRC&D CouncilSolicitation Number: USDA-GRANTS-031803-001Solicitation Title: Biomass Research and Development Initiative2003 Request for Proposal
CONTENTSI. Executive Summary . 1II. Introduction . 1A. Background . 1B. Approach . 2III. Summary of Corn Feedstock Resources inAlabama . 1A. AL Long-Run Trends in Corn Production . 3B. Regional Trends in AL Corn Production. 6C. County Trends in AL Corn Production. 9IV. Analysis of Corn Demand in Alabama . 1A. Catfish Demand for Corn. 1B. Dairy Demand for Corn . 3C. Hogs and Pigs Demand for Corn . 6D. Poultry Demand for Corn. 8E. AL Supply/Demand for Corn .12V. U.S. Corn Market Dynamics and Pricing . 1A. U.S. Corn Production and Consumption . 1B. Corn Pricing. 21. The Role of Futures in Corn Pricing and RiskManagement . 22. Corn Price Forecast . 4a. Agricultural Policy Foundation to the Forecast. 4i
b. The Role of the Ethanol Industry . 4c. Price Forecast . 5d. High and Low Price Scenarios . 6e. North Alabama Basis . 8f. Central Illinois Basis . 12VI. Distillers Grains Market and Pricing . 1A. Background . 1B. United States DDGS Supply and Demand . 1C. Markets Around North Alabama . 3D. DDGS Pricing. 71. Historical DDGS Prices. 72. Forecast DDGS Prices . 7VII. Assessment of Dry Mill Fractionation. 1A. The Potential Market for High Protein Distillers Grains . 2B. The Potential Market for Corn Germ. 4C. Conclusion. 6VIII. Ethanol Market Dynamics and Pricing . 1A. Primary Ethanol Market Analysis Report Findings. 2B. History and Background of U.S. Fuel Ethanol. 51. Ethanol’s History as a Motor Fuel . 52. Understanding Historical U.S. Ethanol Market Prices. 73. Itemization of Public Policy Support History (from1978 to present). 10ii
4. Enactment of the Federal Renewable Fuel Standard . 115. Definition of Historical Fuel Ethanol Demand Growth . 13C. Continued Growth Projected in Ethanol Demand,2005-2015 .141. Projecting Future Ethanol Demand: Baseline ForecastProjections. 152. Projecting Future Ethanol Demand: High-DemandScenarios . 163. Projecting Future Ethanol Demand: Low-DemandScenario . 16D. Liability Concerns & MTBE Bans Create New EthanolMarkets.17E. U.S. Fuel Ethanol Production and Capacity Outlook .17F. U.S. Fuel Ethanol Capacity Will Continue Expansion.19G. Congress and the President Extended Federal EthanolTax Credit.20H. Future U.S. Ethanol Prices Expected to Remain Strong .201. Defining Ethanol Plant Netback Prices . 21I. State Incentives for Ethanol Also Available .22J. Worldwide Growth Market Projected for RenewableEthanol .231. CBI Imports Remain Below Quota, May Face LegalChallenges . 24K. Strategic Location in North Alabama Benefits EthanolSales.25IX. Carbon Dioxide Market. 1A. Demand . 1iii
B. Supply . 1C. Price . 2X. Natural Gas Prices. 1A. Background . 1B. Price Projections . 2XI. Electricity Prices. 1A. Background . 1B. Historical Prices . 1XII. Siting Considerations and Transportation Costs . 1A. Siting Considerations . 1B. Transportation Costs . 8XIII. Fluidized Bed Combustion of Poultry Litter. 1A. Technical Assessment. 11. Technical Challenges and Solutions. 12. Technical Feasibility of the EPI Fluidized BedTechnology for Poultry Litter . 33. System Description. 3B. Economic Assessment . 91. Poultry Litter Energy System Costs . 92. Approach 1: Avoided Natural Gas Costs and FirstApproximation of Cash Flow. 143. Approach 1: Base Case Economic Projections Basedon Avoided Natural Gas Costs. 164. Approach 2: Process Heat Sold to Ethanol Plant at aCost Savings Relative to Using Natural Gas . 19iv
5. Sensitivity Analyses for Projected Returns vs. KeyVariables . 24C. Conclusion. 27D. References. 27XIV. Poultry Litter Supplies and Prices for AlternativeUses . 1A. Amount of Poultry Litter Produced in NorthAlabama . 1B. Environmental Concerns Associated with Current PoultryLitter Practices . 2C. Regulatory Constraints on Land Application of PoultryLitter . 5D. Projected Poultry Litter Prices. 9E. Conclusions. 11F. References.13Attachment A: Summary of Poultry Grower and WasteVendor Surveys .15XV. Fertilizer Nutrient Value of Poultry Litter Ash . 1A. Market Niches for Using Poultry Litter Ash in Fertilizers . 1B. Net Return from Poultry Litter Ash Used inFertilizers . 31. Total P2O5 and K2O in Laboratory-Generated Ash . 52. Expected Reduction in Total P2O5 Due to Use of PhytaseEnzyme in Poultry Feed. 53. Nutrient Dilutants in Process Ash . 54. Percent of Total P2O5 and K2O That can be Claimed on aFertilizer Label . 8v
5. Wholesale Price of Fertilizer Nutrients Displaced byAsh. 86. Discount Relative to Wholesale Price of FertilizerNutrients Displaced. 97. Ash Transportation Costs . 98. Parametric Estimates of Net Return from PoultryLitter Ash. 9C. Physical Properties of Poultry Litter Ash .126. Bulk Density. 127. Particle Size . 13D. Environmental Considerations for Trace Metals inPoultry Litter Ash .13E. References.18XVI. Nutritional Value of Poultry Litter Ash Fed toBroiler Chickens . 1A. Executive Summary . 1B. Objective . 2C. Introduction . 2D. Materials and Methods. 21. Evaluation of Poultry Litter Ash. 22. Experiment 1. 23. Experiment 2. 34. Experiment 3. 35. Processing and Yield Determination. 46. Statistical Analysis. 47. Facilities . 5vi
E. Results and Discussion. 5F. Economic Evaluation of Poultry Litter Ash . 7Appendix A.17XVII. Economics of Corn Ethanol: North Alabama IPEPvs. Traditional North Alabama and Central IllinoisScenarios . 1A. Baseline Comparisons . 11. Economic Tradeoffs. 12. Financial Projections . 3B. Sensitivity Analyses .16C. Conclusions. 20XVIII. Fuel-Cycle Fossil Energy Balance and GreenhouseGas Emissions: IPEP and Traditional Ethanol vs.Gasoline . 1A. Energy Balance . 1B. Greenhouse Gas Emissions. 5C. References. 7XIX. Economic Comparison of IPEP vs. OtherAlternatives to Local Land Application of PoultryLitter . 1A. Long-Distance Transport of Unprocessed Litter . 1B. Pelletizing and Transporting Poultry Litter. 6C. Composting .10D. Electricity Production . 13E. Process Steam for an IPEP Ethanol Plant .19vii
F. Summary and Conclusions . 201. Long-Distance Transport of Poultry Litter. 202. Pelletizing Poultry Litter . 203. Composting . 214. Electricity . 215. Process Steam for an IPEP Ethanol Plant . 21G. References.23XX. Conclusions. 1XXI. Publications . 1XXII. Outreach. 1viii
TablesChapter III.Table 1. AL corn, regional production (bushels). . 7Table 2. AL, area by region, square miles. . 7Table 3. Al corn, production density by region, bushels per square miles. . 7Table 4. AL corn, regional production trend by percent share of total. . 8Table 5. AL corn, regional production, percent change . 8Table 6. AL corn, production by top counties, percent of total. 10Chapter IV.Table 1. Catfish sales, number weight and value for all foodservice. . 1Table 2. Estimation of AL catfish consumption of corn, 2002. . 2Table 3. AL dairy production and marketings. . 4Table 4. Estimation of AL dairy consumption of corn, 2002. 5Table 5. Estimation of AL hogs/pigs consumption of corn, 2002. . 7Table 6. Commercial broiler production, disposition and value. . 10Table 7. Estimation of AL poultry consumption of corn, 2002. 11Table 8. Estimate of total AL livestock (by major category) consumption ofcorn in 2002. . 12Chapter V.Table 1. U.S. corn supply and demand. . 2Table 2. Baseline, low, and high forecasts of futures corn prices(Aug.-Sep. crop year). . 7Table 3. Baseline, low and high forecasts of futures corn prices(calendar year). . 8Table4. Summary of Decatur, Alabama cash and CBOT futures corn prices. 11Table5. Summary of Pekin, IL cash and CBOT futures corn prices. 13Chapter VI.Table 1. DDGS, maximum potential domestic consumption, AL. . 4Table 2. DDGS, maximum potential domestic consumption, GA. . 6Chapter VII.Table 1. Example value of corn oil extraction. . 5Chapter VIII.Table 1. Historical U.S. fuel ethanol prices: yearly averages. 9Table 2. RFS renewable fuel annual ethanol sales volumes. . 12Table 3. Current U.S. fuel ethanol production capacity. . 18Table 4. Ethanol plants under construction. . 19ix
Chapter X.Table 1. Projected average U.S. industrial natural gas prices. . 2Chapter XII.Table 1. Ethanol transportation costs, excluding loading and unloading. . 9Table 2. DDGS transportation costs, excluding loading and unloading. . 10Table 3. Poultry litter feedstock costs. . 10Table 4. Cost comparison of transportation factors at Guntersville andDecatur. 10Table 5. Cost comparison of transportation factors at Guntersville andDecatur. 10Chapter XIII.Table 1. Ultimate analysis (as-received) of sawdust and Delmarva poultrylitter. . 1Table 2. Elemental analysis (%) of ash from sawdust and Delmarva poultrylitter. . 2Table 3. Preliminary estimate of capital costs ( 1000) for poultry litter energy. 10Table 4. Incremental O&M costs for poultry litter energy system co-locatedwith corn/ethanol dry mill. 12Table 5. Net fuel cost. 13Table 6. Net fuel cost. 13Table 7. Poultry litter energy system costs, avoided natural gas costs, andcash flow: first approximation. . 15Table 8. Before-tax profit and cash flow projections for the base caseassuming avoided NG costs. 17Table 9. After-tax profit and cash flow projections for the base case assumingavoided NG cost. 18Table 10. Poultry litter energy system costs and cash flow: firstapproximation. . 21Table 11. Before-tax profit and cash flow projections for the base caseassuming steam revenues. 22Table 12. After-tax profit and cash flow projections for the base caseassuming steam revenues. 23Table 13. Poultry litter energy plant: sensitivity of IRR and ROI to steamprice. 24Table 14. Poultry litter energy plant: sensitivity of IRR and ROI to capitalcosts. . 25Table 15. Poultry litter energy plant: sensitivity IRR and ROI to O&M. . 25Table 16. Poultry litter energy plant: sensitivity of IRR and ROI to poultry litterfeedstock costs. 25Table 17. Poultry litter energy plant: sensitivity of IRR and ROI to poultry litterash revenue. 26x
Chapter XIV.Table 1. Broiler and broiler litter production in leading broiler counties in northAlabama. . 1Chapter XV.Table 1. Broiler fuel parameters and metals content of broiler litter ash (dataprovided by Maryland Department of Natural Resources, Power PlantAssessment Division): Appendix B atwww.nrbp.org/pdfs/pub20b.pdf. . 7Table 2. Projected net return to energy plant from poultry litter ash. . 11Table 3. Projected net return (after ash transportation costs) from ash,assuming 95 percent of the ash P2O5 can be claimed on a fertilizerlabel. . 12Table 4. Projected net return (after ash transportation costs), from ash,assuming 75 percent of the ash P2O5 can be claimed on a fertilizerlabel. . 12Table 5. Metals concentrations in broiler litter from Delmarva growers andprojected maximum metal loading rates for land-applied broiler litter ashcompared with levels allowed by the Uniform State Fertilizer Bill,American Association of Plant Food Control Officials. . 15Table 6. Metals concentrations in broiler litter ash from Delmarva growers andprojected maximum metal loading rates for land applied broiler litter ashcompared with the Canadian fertilizer standard for metals loading. . 16Table 7. Metals concentrations in broiler litter ash from Delmarva growers andprojected maximum metal loading rates for land-applied broiler litter ashcompared with EPA 503 regulations for land application of biosolids. . 17Chapter XVI.Table 1. Composition of poultry litter ash. . 1Table 2. Composition and calculated analysis of experimental starter diets(Experiments 1 and 2). 9Table 3. Composition and calculated analysis of experimental grower diets(Experiments 1 and 2). 10Table 4. Composition and calculated analysis of experimental starter diets(Experiment 3). . 11Table 5. Composition and calculated analysis of experimental grower diets(Experiment 3). . 12Table 6. Composition and calculated analysis of experimental finisher diets(Experiment 3) . 13Table 7. Performance of mixed sex broilers fed graded levels of poultry litterash (Experiment 1). 14Table 8. Percentage of excreta moisture , dry bone ash and dry matterdigestibility of nutrients in broiler diets utilizing graded levels of poultrylitter ash (Experiment 2). . 14xi
Table 9. Bodyweight, bodyweight gain, feed consumption, feed efficiency, andmortality of mixed sex broilers fed graded levels of poultry litter ash inthe diet (Experiment 3). 15Table 10. Processing performance of broilers at 41 days of age fed gradedlevels of poultry litter ash (Experiment 3). . 16Chapter XVII.Table 1. Baseline economic tradeoffs: Decatur, AL NG vs. Pekin, ILNG (10-year averages). 2Table 2. Baseline economic tradeoffs: Decatur, AL IPEP vs. Pekin, ILNG (10-year averages). 2Table 3. Baseline economic tradeoffs: Guntersville, AL IPEP vs. Pekin, ILNG (10-year averages). 3Table 4. Financial analysis assumptions (part 1): Pekin, IL NG Scenario. . 4Table 5. Financial analysis assumptions (part 1): Pekin, IL NG Scenario. . 5Table 6. Profit and cash flow analysis ( 1000): Pekin, IL NG Scenario. 6Table 7. Financial analysis assumptions (part 1): Decatur, AL NG Scenario. . 7Table 8. Financial analysis assumptions (part 1): Decatur, AL NG Scenario. . 8Table 9. Profit and cash flow analysis ( 1000): Decatur, AL NG Scenario. 9Table 10. Financial analysis assumptions (part 1): Decatur, AL IPEP Scenario. 10Table 11. Financial analysis assumptions (part 1): Decatur, AL IPEP Scenario. 11Table 12. Profit and cash flow analysis ( 1000): Decatur, AL IPEP Scenario. . 12Table 13. Financial analysis assumptions (part 1): Guntersville, AL IPEPScenario . .13Table 14. Financial analysis assumptions (part 1): Guntersville, AL IPEPScenario. . 14Table 15. Profit and cash flow analysis ( 1000): Guntersville, AL IPEPScenario. . 15Table 16. Summary of returns for baseline ethanol plant scenarios . 16Table 17. North Alabama ethanol, corn, and DDGS prices(highlighted in yellow) for low, baseline, and high scenariosassessed in financial analyses. . 17Table 18. Sensitivity of ROI and IRR to ethanol and corn/DDGS prices for anorth AL IPEP scenario . 18Table 19. Sensativity of ROI and IRR to steam price from poultry litter for anorth AL IPEP scenario . 19Chapter XVIII.Table 1. Well-to-pump fossil energy input per Btu of fuel at fueling station. . 4Table 2. ICM energy efficiency guarantee: natural gas requirement forconverting corn to ethanol. . 4Table 3. Well-to-wheel reductions in greenhouse gas (GHG) emissions forethanol from corn vs. conventional gasoline. . 6Table 4. Carbon dioxide emissions from natural gas based on ICM energyefficiency guarantee. . 6xii
Chapter XIX.Table 1. Value of commercial fertilizer potentially displaced by poultry litter. . 2Table 2. Maximum potential cost savings via substituting poultry litter forcommercial N-P-K fertilizer. 3Table 3. Maximum potential cost savings via substituting poultry litter forcommercial N-P-K fertilizer. 4Table 4. Economics of pelletizing poultry litter –15-year projection. . 7Table 5. Impact of pellet price on profitability of pelletizing poultry litter. . 8Table 6. Production cost for composting poultry litter for bulk market. . 11Table 7. Impact of bulk compost price on profitability of poultry littercomposting. 12Table 8. Operating characteristics of the Fibrowatt UK poultry litter powerplants. 13Table 9. Capital and O&M costs for producing electricity with EPI fluid bubblingbed. .15Table 10. Economics of producing electricity from poultry litter—15 yearprojection. 15Table 11. Impact of electricity price on profitability of producing electricity frompoultry litter. 16Chapter XXII.Table 1. Outreach activities for the IPEP feasibility project. . 2xiii
FiguresChapter III.Figure 1. AL corn acres planted, long-run trend. . 3Figure 2. AL percent share of field crops’ acres planted. .
Integrated Poultry and Ethanol Production (IPEP) Feasibility Study Final Report for NRCS Grant Agreement 68-3A75-3-144 . Feasibility of an Integrated System for Improving the Economic and Environmental Performance of Poultry and Ethanol Production in North Alabama Final Report for NRCS Grant Agreement 68-3A75-3-144 September 2006 Prime .
supply of quality poultry feeds, high veterinary and poultry feed costs and lack of poultry processing industries. The poultry sector is also suffering from chaotic and unorganised distribution system and lack of third-party logistics cold chain for poultry and poultry pro
David Rountree, Alabama Public Service Commission david.rountree@psc.alabama.gov (334) 242-5194 Mac Sadler, Alabama Department of Revenue mac.sadler@revenue.alabama.gov (334) 242-1498 DeLois Thigpen, Alabama Executive Budget Office delois.thigpen@budget.alabama.gov (334) 242-7245 Tammy Wallace, Alabama State Board
poultry site news 2009). In poultry production small-scale poultry production represents one of the few opportunities for saving, investment and security against risks. It accounts for approximately 90% of total poultry production (Branckaert 1999). Despite the acknowledge importance of poultry production Akanni (2007) opined that it is .
ALABAMA-GENERAL Frontier Claims in the Lower South comp by Richard S. Lackey, 1977 (HPL) ALABAMA-GENERAL History of Alabama and Dictionary of Alabama Biography. Vol. 1. By Thomas M. Owen. Reprint Co. Pub. 1978 (H.P.L.) ALABAMA-GENERAL History of Alabama and Dictionary of Alabama Biography. Vol. II. By Thomas M. Owen. Reprint Co. Pub. 1978 (H.P.L.)
Homestead and small-scale poultry production provides income and food for the family. In developing countries, women and children often raise chickens and other poultry. Women in rural households raise poultry primarily to sell the eggs and an occasional chicken. The income from poultry is often one of the few significant sources of income for .
different regions for poultry and eggs. Poultry production is concentrated in the central east part of the country. Figure 2.1. Main regions with egg production (in million eggs, left graph) and poultry meat production (in 1000 head, right graph) based on 2015 data (source: SSC). Table 2.1 gives the top five regions for poultry meat and eggs.
mainly commercial poultry producers). Small-scale poultry and egg farmers that are normally classified into the SMME category and are frequently family operations. Poultry is a large levy payer exceeding R46 million annually. The poultry meat industry made the largest contribution to the gross value of animal products, which contributed 48 .
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