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US sees ethanol export potential to China

A USDA-led trade mission to northeast China turned up greater opportunities than expected for significant export potential of U.S.-produced ethanol.  National Farmers Union President Roger Johnson says China is producing ethanol but recognizes the eventual need to import it because of growing fuel demands.  Johnson says,  “They recognize that there is a limitation to how much they can produce. The food versus fuel debate I think is something they’re sensitive to there as well as sort of the GMO issue.”  China has rejected U.S. distillers dried grains because it’s GMO/biotech approval process.

Jim Miller, Growth Energy vice president and economist, who was also on the trade trip, says China has been in talks with Brazil but does not see that country as a reliable ethanol source.  Miller says, “Right now, I think our biggest competition is China itself and the barriers to entry that they have.  Currently, China prohibits the import of fuel ethanol by law.”

Kelly Davis, Renewable Fuels Association’s regulatory affairs director, says China is shifting from grain-based ethanol production toward cellulosic ethanol because of the food-versus-fuel debate which she says will be the biggest barrier to overcome.

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