[Federal Register Volume 72, Number 139 (Friday, July 20, 2007)]
[Proposed Rules]
[Pages 39762-39764]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-14018]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 72, No. 139 / Friday, July 20, 2007 /
Proposed Rules
[[Page 39762]]
DEPARTMENT OF AGRICULTURE
Grain Inspection, Packers and Stockyards Administration
7 CFR Chapter VIII
RIN 0580-AB00
The Role of USDA in Differentiating Grain Inputs for Ethanol
Production and Standardizing Testing of the Co-Products of Ethanol
Production
AGENCY: Grain Inspection, Packers and Stockyards Administration, USDA.
ACTION: Advance notice of proposed rulemaking.
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SUMMARY: We are inviting comments from producers, handlers, processors,
livestock feeders, industry representatives, and other interested
persons on the appropriate government role with regard to
differentiating grain attributes for ethanol conversion, as well as
standardizing the testing of co-products of ethanol production,
commonly referred to as distillers grains. We have monitored the
development of this expanding industry and believe now is an
appropriate time to seek input from stakeholders in order to foster
collaboration among segments of this industry and support the marketing
of ethanol co-products.
DATES: We will consider comments that we receive by September 18, 2007.
ADDRESSES: We invite you to submit comments on this advance notice of
proposed rulemaking. You may submit comments by any of the following
methods:
E-Mail: Send comments via electronic mail to
[email protected].
Mail: Send hardcopy written comments to Tess Butler,
GIPSA, USDA, 1400 Independence Avenue, SW., Room 1647-S, Washington, DC
20250-3604.
Fax: Send comments by facsimile transmission to: (202)
690-2755.
Hand Delivery or Courier: Deliver comments to: Tess
Butler, GIPSA, USDA, 1400 Independence Avenue, SW., Room 1647-S,
Washington, DC 20250-3604.
Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the online instructions for submitting
comments.
Instructions: All comments should make reference to the
date and page number of this issue of the Federal Register.
Read Comments: All comments will be available for public
inspection in the above office during regular business hours (7 CFR
1.27 (b)).
FOR FURTHER INFORMATION CONTACT: Eric Jabs at GIPSA, USDA, 6501 Beacon
Drive, Suite 180 Stop 1404, Kansas City, MO 64133; Telephone (816) 823-
4635; Fax Number (816) 823-4644; e-mail [email protected].
SUPPLEMENTARY INFORMATION:
Executive Order 12866
This advance notice of proposed rulemaking has been determined to
be not significant for the purposes of Executive Order 12866, and
therefore, has not been reviewed by the Office of Management and
Budget.
Background
The modern fuel ethanol industry uses cereal grains, such as corn,
sorghum, and wheat, to convert the starch in the seeds to ethanol by
fermentation and distillation. GIPSA has followed the growth of this
industry for several years, focusing on utilization of grains, the
subsequent impact on supply, and the development of markets for the co-
product known as distillers grains. Expansion of the fuel ethanol
industry is driven, among other things, by the Energy Policy Act of
2005 (42 U.S.C. 15801) which mandates that 7.5 billion gallons of
renewable fuels are utilized by 2012 (which has had a bullish impact on
corn prices), the relationship between ethanol prices and crude oil
futures, and overall profitability in the ethanol sector. At the
beginning of 2007, there were 110 bio-refineries or ethanol plants on-
line in 19 States with an annual capacity of 5.5 billion gallons.
Seventy-three refineries were under construction and eight were
expanding, creating an additional 6 billions gallons of production
capacity by 2009. Corn is currently the primary grain for ethanol
production (more than 95 percent). In calendar year 2006, 1.8 billion
bushels of corn produced 4.9 billion gallons of ethanol and 12 million
metric tons of distillers grains. In calendar year 2006, the United
States exported 1.25 million metric tons of distillers dried grains
(DDG), primarily to Mexico, the European Union, Canada, Japan, Taiwan,
and others.
Distillers grains are typically marketed to feed formulators for
livestock feeding, primarily beef, dairy, pork, and poultry. Most U.S.
ethanol plants are located in reasonable proximity to animal feeding
operations to aid logistics. When used locally, the distillers grains
move by truck and are sold on a ``wet'' (50-65 percent moisture
content) basis, which saves the cost of drying. Distillers grains may
move by rail, either to feedlots or to export facilities. In this case,
DDG have a moisture content of about 11-12 percent and 75-80 percent of
distillers grains are sold this way. One bushel of corn produces
approximately 2.8 gallons of ethanol and 17 pounds of distillers
grains.
The grains used for ethanol production are standardized in 7 CFR
Part 810. Unless exported, there is no requirement for those grains to
be officially inspected. The Association of American Feed Control
Officials (AAFCO) has developed definitions for distillers grains as
provided in their 2006 Official Publication. Section 27 of the Feed
Ingredient Definitions provides definitions for Corn Distillers Dried
Grains (DDG), Corn Distillers Dried Grains with Solubles (DDGS), Corn
Distillers Wet Grains (DWG) and Corn Condensed Distillers Solubles
(CDS). (2006 Official Publication, Association of American Feed Control
Officials Incorporated. Sharon Krebs, Editor. Oxford, IN. 2006.
Distillers Products, pages 273-274.)
Trading Without Federal Standards
There are well developed markets for by-products of standardized
grain which trade without government participation. Examples include
soybean meal, soybean oil, and brewers spent grains. In the soybean
meal market, the National Oilseed Processors Association (NOPA)
established trading rules in 1933, which were last revised in February
2007. The rules serve as guides, and parties to trades are free to
adopt, modify, or disregard the rules. These rules govern sampling,
testing, and specifications for soybean meal.
[[Page 39763]]
Soybean meal trades on the Chicago Board of Trade, and the standard
specifications for deliverable grade define specified levels of
protein, fat, fiber and moisture content. Unlike distillers grains
which are highly variable, soybean meal is very consistent because one
processing method is used almost exclusively.
Testing Grain
We contacted industry participants and heard that price was the
focal point for ethanol processors, while grain quality and timing of
deliveries were also of concern. Basic quality factors a processor
might consider when sourcing grain include moisture content, protein
content, and mycotoxins (aflatoxins in corn for example) content.
Additional factors for testing might include some aspect of starch
quality, nutrient composition, crude fat, crude fiber; a test to
differentiate a grain specifically designed for ethanol conversion,
such as grain with a high total fermentable starch content; or an end-
use trait, such as a specific amino acid characteristic. Many
processors indicated that co-product quality was of concern when
sourcing grain, and most processors have grain inspected, either in-
house or by contract with an independent laboratory. Conversion of
grain to ethanol consumes the starch and leaves the remainder of the
grain as the co-product. As a general rule, conversion results in a
three-fold concentration in the residual material (i.e., protein, fat,
or mycotoxins) in the distillers dried grains. Aflatoxin,
Deoxynivalenol, Fumonisins, Zearalenone, and T2 Toxin are mycotoxins
that can be present in distiller's grains by-products if the grain
delivered to the ethanol plant is contaminated. Mycotoxins are not
destroyed during the ethanol production process and are not destroyed
during the drying process to produce distillers grains co-products.
Definitions and Standardization of Testing for Distillers Grains
While we heard from industry participants that at this time there
is no need for GIPSA to establish grading standards for distillers
grains (but we might have a role in minimizing market inefficiencies
caused by inconsistent testing, either through standardization or
validating tests used by the market), others have asked that we at
least consider whether there is a need for official standards. Some
stakeholders told us they do not feel that current industry-based
definitions adequately describe the products.
Alternately, an industry working group, including the American Feed
Industry Association (AFIA), the Renewable Fuels Association, and the
National Corn Growers Association, states that the current definitions
adequately define the distillers products of today, preferring a broad
definition. Further, the working group stated that the AFIA Ingredient
Guidelines should be considered for updating to address modern
processing technologies.
The industry working group also evaluated empirical methods of
analyses for Distillers Dried Grains with Solubles (DDGS) for which
``there are no guidelines or recommendations on which analytical test
methods should be used * * *'', focusing on analytical methods for
moisture, crude protein, crude fat and crude fiber. DDGS currently
accounts for about half of the distillers grains industry volume.
Potential Role for GIPSA
GIPSA facilitates the marketing of livestock, poultry, meat,
cereals, oilseeds, and related agricultural products, and promotes fair
and competitive trading practices for the overall benefit of consumers
and American agriculture. We facilitate the marketing of U.S. grains
and oilseeds by establishing standards for quality assessments,
regulating handling practices, and managing a network of Federal,
State, and private laboratories that provide impartial, user-fee funded
official inspection and weighing services. Recognizing that sampling is
the single largest source of error in the analysis of grains, we offer
sampling guidelines to the grain handling industry. Finally, for grains
and commodities which are not standardized (e.g., hulless oats,
popcorn, corn gluten feed), we provide official procedures for analysis
of specific factors.
As agricultural crops evolve and varieties with enhanced traits are
developed, reliable tests must be developed to quantify the quality
traits important to the market. Rapid tests and test kits are evaluated
that detect biotechnology derived grains and oil seeds, analyze
protein, moisture, oil, and mycotoxins. With the development of such
new testing procedures, reference methods are needed to validate and
improve their accuracy. This is an area where GIPSA has experience and
expertise, which may prove valuable in this instance.
Objective grain/co-product quality assessments (official and
unofficial) require reliable, well-standardized measurement methods.
Inspection methods can be classified as reference (direct) methods or
secondary (indirect) methods. Reference methods are those that
``define'' the quantity or quality in question. To provide the market
with rapid, cost-effective quality assessments, GIPSA develops
secondary or rapid methods, based on national reference methods, for
routine inspection use in the official system. These secondary methods
make physical, chemical, electronic, and/or optical measurements
related to the desired quality characteristics. GIPSA conducts research
to develop, evaluate, and improve reference methods and secondary
methods for grain and grain product quality analysis to better meet
global grain inspection and marketing needs.
In 2001, we took a new approach in response to the market's need
for testing the products of agricultural biotechnology. We established
a voluntary proficiency program to organizations testing for
biotechnology-derived grains and oilseeds to improve the reliability of
testing. We also evaluate the performance of rapid tests developed to
detect biotechnology-derived grains and oilseeds and mycotoxins, and
confirm the tests operate in accordance with the manufacturers' claims.
GIPSA is issuing this advance notice of proposed rulemaking to
invite comments from all interested persons on how we can best
facilitate the marketing of distillers grains in today's evolving
marketplace. We are seeking comment on market needs and the feasibility
and desirability of GIPSA's programs to facilitate the marketing of
these products. All interested persons are encouraged to comment on the
following issues related to this notice:
1. What should GIPSA's role, if any, be in standardizing the
testing of inputs and outputs of ethanol co-product processing?
2. What factors are currently assessed on the input grains for
ethanol conversion? Please list the factors by specific grain. What
other factors would you test input grain for, if a test were available?
3. What analytes or factors are currently assessed on co-products
of ethanol production? Please list the factors by specific co-product
type. What other factors would you test for, if a test were available?
4. The industry lacks agreement on reference methods for analysis
of co-product attributes. Should GIPSA play a role in the
standardization of reference methods? If so, what should that role be?
5. Secondary or rapid methods are used by the official inspection
system to determine product quality. Should GIPSA play a role in the
validation or
[[Page 39764]]
standardization of secondary or rapid methods? Should we limit our
participation to validating the performance of test kits? Are there
rapid tests in existence other than test kits of which you are aware?
6. Should we work on developing reference methods for tests of
specific traits in grains, such as fermentable starch content? Should
GIPSA pursue standardized, secondary tests for the presence of specific
traits in grains, such as fermentable starch content?
7. Are co-products of ethanol production considered cereal
products, according to the European Union regulations (COMMISSION
REGULATION (EC) No 856/2005) for mycotoxin limits in cereals and cereal
products? Should GIPSA validate the performance of test kits for the
detection of mycotoxins in distillers grains? If so, what are the
limits of detection which should be considered?
We welcome your comments on these issues as well as any comments or
suggestions related to distillers grains.
Authority: 7 U.S.C. 71-87.
David R. Shipman,
Acting Administrator, Grain Inspection, Packers and Stockyards
Administration.
[FR Doc. E7-14018 Filed 7-19-07; 8:45 am]
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