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By: Vanessa Moss | Posted: on August 09, 2008

	CHILD OF THE CORN The new $140 million Aylmer ethanol plant should be running at 70 per cent capacity in early September, with plans to open up full production later that month. By using 38,000 bushels of corn per day, the facility will pump out 150 million litres of ethanol yearly.

Five years and $140 million later, the Aylmer ethanol plant is on the brink of starting up.
Corn is currently being purchased and trial runs are scheduled for late August; the facility should be at full capacity by the end of September, said Tom Cox, chair of the Integrated Grain Processors Co-operative Inc. (IGPC).
At that point, the plant will be producing between 450,000 and 500,000 litres of denatured, fuel-grade ethanol daily, amounting to about 150 million litres a year.
Since most cars take about 50 litres of fuel to fill and blended fuels in North America are normally comprised of 10 per cent ethanol and 90 per cent gasoline, the plant will be contributing a good share.
“You can see that it’s quite a lot of cars being filled up,” Cox said.
The IGPC was incorporated in April 2002 with the goal of building an ethanol plant in southwestern Ontario that would increase the price corn producers receive for their product and boost the production of renewable fuels. Another objective was to create jobs – the plant employs 40 right now, with many more supported indirectly.
Made up of 850 members from about 10 counties in southern Ontario, the IGPC has received both federal and provincial government support, Cox said, but the majority of the funding has come from members’ investments.
Along with implementing various programs to encourage the use of alternative fuels, the Ontario government mandated in January 2007 that five per cent of all gasoline sold in Ontario be blended.
“That created a substantial market,” Cox said, mostly in the Greater Toronto Area. Retail outlets like Sunoco and Shell have taken a particular interest in offering blended fuels.
The federal government has also stepped in, legislating that by 2010, five per cent of all gasoline sold across Canada be ethanol-blended.
This move has come into question lately, however, as critics charge that use of ethanol as a fuel source is increasing the price of corn, an important food source.
Cox said that those concerns came up in the spring when the weather was not ideal for corn production in the United States and prices rose. Now, yields are looking a lot better, leading to a drop in corn prices by about 35-40 per cent in the last few months. Ethanol prices have also fallen about 25 per cent.
“Most commodities are going through a bit of a retreat from where they were say six to eight weeks ago.”
These fluctuations are not much of a concern for the IGPC though, since their members represent both sides of the coin.
“We don’t care about the absolute price of either corn or ethanol. We care about the spread between the two, and our margins have been improving over the last six weeks; obviously, lower corn prices make it cheaper for us to operate,” he said.
“A lot of our members are corn producers, and one of the objectives of an ethanol plant was to have something that when corn prices drop, it was a benefit to the ethanol plant [and] when corn prices rise, it was an advantage to a corn producer. So it’s a real hedge for someone who is a corn producer.
“You’re not always sad when the price of corn drops anymore.”
As the corn harvest approaches, output is looking great both south of the border and in southern Ontario, Cox said.
“For the most part it’s very good. The crop in the United States … some of the forecasts coming out this week are that they may be having the second largest crop they’ve ever had.”
Even areas in southern Ontario that have experienced record rainfalls should fare well since corn, once planted, can tolerate those conditions, he said.
Along with concerns about prices, ethanol producers have been fielding questions lately about the long-term viability of their alternative-fuel solution. These queries have even caused Ontario Premier Dalton McGuinty to reconsider his plan to double the ethanol content of gasoline to 10 per cent by 2010.
“There’s been some questions that maybe things have moved too far, too fast,” Cox said, adding that the premier’s decision to do more research before making a decision is probably a good idea.
“It’s a reasonable response; it’s not something we’re particularly concerned about.”
Cox said he is encouraged by the five ethanol plants already up and running across Ontario, another under construction and theirs almost ready to go: developments that suggest renewable fuels seem to be catching on.
“It’s pretty exciting. We’ve been at this more than five years. These are big projects and they’re extremely difficult to get brought together and the financing in place, so it’s pretty neat to see things reaching their conclusion and we might actually start making some money. We’ve certainly been spending it.”

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