Coming to terms with ethanol in Northwest Indiana

The Iroquois Bio-Energy Co. plant near Rensselaer fired up equipment in January for turning corn into fuel to became part of a burgeoning U.S. industry expected to produce more than 6.1 billion gallons of ethanol this year.

Rob Churchill grew corn on nearly 5,000 acres outside of Lake Village, joining farmers nationwide who devoted more farmland than ever to corn that will feed the ethanol industry.

Consumers, meanwhile, are still coming to terms with the corn-based fuel additive, and the vehicles capable of running on increased levels of it, industry observers said.

Just about every corn kernel grown on the Churchill family farm this year will be mashed into ethanol at the Iroquois plant, capable of turning 14.3 million bushels of corn yearly into 40 million gallons of fuel-grade ethanol.

Where in past years the Churchills grew corn on about 70 percent of their 5,600 acres, "this year we went higher," Rob Churchill said.

The family dedicated more than 90 percent of the acreage to corn, Churchill said, and nearly all of the harvest will be trucked to Iroquois Bio-Energy.

"They're the closest to us and (came) with the highest bid," Churchill said. "It made the most sense."

Planting more corn made sense to many U.S. farmers this year.

Corn acreage nationwide grew to 85.4 million, up from 70.6 million last year, according to the U.S. Department of Agriculture.

Indiana farmers planted 6.45 million acres in corn, 20 percent more than the 5.38 million planted last year.

"This was a huge change, to plant 20 percent more corn in the state of Indiana," said Chris Hurt, agricultural economist with Purdue University.

"This was a radical change for one year," Hurt said. "Producers are responding to the need to produce more corn for the fuel market."

Iroquois Bio-Energy put Northwest Indiana on the ethanol map when it came on line in January.

Together with the state's three other operating plants, it pushed Indiana's yearly capacity to just over 290 million gallons of ethanol. That number is expected to jump to 940 million gallons when four Indiana plants currently under construction are opened, according to the Renewable Fuels Association.

A total 119 ethanol plants were on line in the U.S. in 2007, according to the Renewable Fuels Association.

The 86 plants currently being built or expanding will push ethanol production capacity to 6.4 billion gallons.

The Bush administration in 2005 called for the volume of renewable fuel required to be blended into gasoline to climb to 7.5 billion gallons by 2012.

At the time, the nation was only producing 2.3 billion gallons, said John Ferrell, manager of the Biomass Feedstock Platform with the U.S. Department of Energy.

At 2007 capacity for 6.4 billion gallons, "the industry has surpassed the level they would need to be at," to meet the 2012 goal, Ferrell said, and some U.S. legislators want the goal to now be set higher.

The challenge remains of getting consumers to buy into the ethanol alternative.

"You need to have a balance between supply and demand," Ferrell said.