Rocks and blue ocean strategies for ethanol

Mike Bryan raised the question in a column of his a few months ago: is there a blue ocean strategy out there for the ethanol industry? I’ve pondered the question since.
By Susanne Retka Schill | June 25, 2012

For the nonfarm folks, first, a bit of a tutorial on one of the more humble tasks of farming – rock picking. Rocks create real headaches for equipment, getting stuck or smashing things up should they move through a combine, for instance. Hand picking isn’t done as much as in the old days, thanks to the invention of rock pickers. Also, new equipment designs try to engineer around rock issues. The popular, relatively new, quarter-million-dollar air seeders, for instance, use spikes that move a rock aside rather than coulters where rocks would jam. One of the big reasons the Red River Valley of the North, where I work, is big in potatoes and sugar beets is the deep, rich topsoil and absence of rocks – makes it much easier to dig root crops when you don’t have to contend with rocks.

So, here’s one for those with rock knowledge that will leave your mouth hanging open. Agweek writer Mikkel Pates reported on the World Potato Congress in Scotland in late May and took the opportunity to write about Scottish farming, which he adds wryly is “somewhat different than in North America.”

“On a field that has been plowed in autumn, the Scots will go in with a stone separator to remove the stones and clods in the top 20 inches or so. The machine places the stones into a windrow which goes under the wheel or ‘wheeling’ of the stone separator, where they’ll stay all season.

“Next, they put up a deep soil ridge and plant [potatoes] into that ridge.

“The stones are never removed. When the farmers cultivate after the potato crop to plant canola or whatever, the stones are redistributed. The farmers see the stones having a function in the field for warming the soil, and moisture infiltration. They also provide traction at harvest.”

Now that’s a radically different approach to rocks, which brings to mind a column that  BBI International Chairman Mike Bryan wrote a few months ago about blue ocean strategies. Most companies are firmly immersed in red ocean strategies, fighting bloody battles with the competition. A blue ocean strategy takes a flying leap to create a new paradigm, where the company can flourish, free of competition.  “One interesting example is Cirque du Soleil,” he wrote. “They changed the entire circus industry from one of three rings, high cost and dwindling attendance by parents and children, to a whole new uncontested market for adults and corporate clients that made the competition irrelevant.”

He raises the question, is there a blue ocean strategy out there for the ethanol industry? He had no suggestions, just posed the question which I’ve pondered since. In one respect, the recent promotions of ethanol in racing circles is an attempt to reframe the discussion on ethanol’s value. Here’s another idea that wouldn’t be easy to achieve, but would certainly change the game. How about a car totally optimized for ethanol – probably E85, but we all know Brazil has hydrous E100 burning in some of their cars. If that car made 100 miles to the gallon, wouldn’t that be something?

A wild idea, yes. But I dimly recall a story months ago about a college engineering contest where the winning vehicle did better than that on E85.

I can think of another example of a project that could fundamentally change the perception of ethanol. Novozymes and CleanStar Mozambique have embarked on an agricultural development project that includes cassava production for food and fuel. Novozymes enlisted the aid of ICM in designing an appropriately-scaled ethanol production facility. They also worked with the makers of ethanol-fueled cook stoves. The goal is to replace charcoal cooking which causes both major health issues due to indoor air pollution as well as exacerbating deforestation, plus it would provide an alternative market for cassava producers.  Ethanol in this scenario is indisputably a clean-burning, forest-saving, renewable fuel.

Placing the concept in Africa rather than the Corn Belt casts ethanol in a different light. Others are seeing the opportunity, I recall hearing a comment at FEW that one of the first projects for Jeff Broin’s foundation will be ethanol for cooking stoves.

Many developing countries are energy deficient. Renewable fuels could not only displace the need for imported oil, farm-based biofuel feedstocks also provide rural economic development opportunities. Hmmm. That has a familiar ring. The Minnesota Corn Growers Association sent out a press release a couple of weeks ago calling attention to just how ethanol is fueling rural economies. Look anywhere in the world, the feedstock of choice for ethanol is the most abundant crop. In Brazil, it’s sugarcane. In part of Russia, it’s potatoes. In parts of Europe, it’s sugar beets.  In Western Canada, it’s wheat and Eastern Canada, corn. Ethanol is a very versatile renewable fuel, indeed.