Increase in demand for ethanol as a fuel additive has resulted in growth in ethanol production. Ethanol is produced from corn by either wet milling or dry grind processing. In wet milling, the corn kernel is fractionated into different components, resulting in several coproducts. Wet mill plants are capital intensive because of equipment requirements and typically are corporate owned. In dry grind processing, the corn kernel is not fractionated and only one coproduct, distillers dried grains with solubles (DDGS), is generated. Dry grind plants require less equipment and capital than wet mills. They typically are producer owned and add direct benefits to rural economies. Most of the increase in ethanol production during the past decade is attributed to growth in the dry grind industry. The marketing of coproducts provides income to offset processing costs. For dry grind plants, this is especially important, because only one coproduct is available. Several issues affect DDGS marketing. The increasing volume of DDGS accompanying ethanol production could reduce market value; high phosphorus content could limit use of DDGS, because of animal waste disposal issues. Technologies to remove germ and fiber from DDGS could produce a coproduct suitable for feeding to nonruminants; this would expand the markets for DDGS. Reducing phosphorus in DDGS would sustain markets for conventional DDGS. New technologies could contribute to long term stability of dry grind plants.


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