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Can soy diesel help turn ag economy around?

Well-known for offering stellar seed, those running Delta King may soon be known for something else: helping bring bio-diesel onto the Delta scene. Last winter, Noal and T.J. Lawhon, along with business associate Mark Holland, started talking about what fuel made from soybeans could mean for the Delta.

Emboldened with the possibilities, Noal — who runs the McCrory, Ark.-based seed company — gave the okay and bio-diesel was in company holding tanks in May. All diesel engines in the Delta King fleet are now fed a blend of road diesel and the soybean fuel.

“There was no real preparation work for this at all. We have three tanks we keep diesel fuel in — a 4,000-gallon tank and two 2,000-gallon tanks. We checked how much diesel was left in the tank and calculated how much soy diesel (B100) to put in to make a 4 percent blend. We're using a 4 percent blend across the board here.

“Our original purchase was for 6,000 gallons of the blended material,” says T.J.

The regular diesel is blended with B100 at the tank.

The Lawhons' fuel distributor in McCrory buys B100 out of a plant in Illinois. The distributor has it shipped in and stored. When he visits the Delta King complex, he brings both B100 and commercial diesel on his truck and blends them into the Lawhons' tanks.

“We don't hold any of the B100 material here, just the blend. The actual action of pouring the two fuels into the tank mixes them. We're using this in any vehicle we have with a diesel engine. Nothing has to be done to the engine to accommodate the fuel,” says Holland, Delta King finance and information systems director.

Everything in a diesel engine — filters, injectors — accepts the 4 percent blend with no trouble, says T.J.

B100 is a solvent and isn't a gluey, oily substance like most people suspect. Since it is a solvent, it actually cleans the engine while in operation. B100 will make the solvents in road diesel settle to the bottom of the tank.

“Those particles then get into the filter, so filters must be changed more often. But other than cleaning filters, that's it. And that isn't really a bad thing. So far, we've been getting the same miles-to-the-gallon as with regular diesel,” says T.J.

The Lawhons admit it's costing more money to operate on soy diesel. But that extra expense can be easily overcome if enough people start using the soybean-derived fuel. The biggest expense the Lawhons have with B100 is freight — just getting the B100 to McCrory. The more demand there is, though, the more sense it would make for an investor to put a plant in some Delta state, says Noal. But a demand must be created.

“The soy diesel is costing us 4 cents per gallon more than road diesel. If we use 20,000 gallons of diesel, we'll pay $800 more than we would otherwise. That won't break the bank. It's a small price to pay when you put that beside how many bushels of soybeans we're taking off the surplus. If everyone started doing that, the surplus would drop and prices for soybeans would rise. Farmers would be happy and taxpayers would be happy that subsidy checks wouldn't have to be as high,” says Noal.

The reason Delta King is doing this is simple, says T.J.: “We're an ag-based business and we want to put more money into the ag channel.”

Holland says the agriculture industry must be more creative in terms of finding solutions to current fiscal problems. Continuing the current cycle — depending on government for everything — “just isn't good. No one wants that. We need creative, out-of-the-box solutions. We must think of ways to better utilize our crops. How can we use up surpluses?”

By using soy diesel, everyone wins, say the men. Surpluses are used, commodity prices go up, and farmers become less dependent on D.C. largesse. Dependence on foreign oil isn't as great, and if the country needs more fuel, it can be grown.

Plus it's much cleaner for the environment — the higher percent of bio diesel in the blend, the cleaner the exhaust.

“California has mandated that any public transportation has to use (20 percent soybean oil with the balance in road diesel). We'd use 20 percent too, but it's currently too cost-prohibitive. But California is doing this and they don't even grow soybeans out there,” says Holland. “If the same could be done in Delta states, we'd love it. But it's going to take grass-roots folks to get this rolling.”

The agriculture industry is a tight-knit bunch. “We all know and do business together. I think if we could all get together and get some momentum behind this, it has the potential to make a difference for the ag chain from the first to last link,” says Noal.

Farmers in central Arkansas are already taking notice. “When T.J. started working on this, we mentioned it to some farmers around here and immediately they wanted to know more. If farmers have the information, they'll generally latch on to this. Everyone wants to move the market, to get rid of soybeans.

“As soon as we got the first tanker load of B100, three farmers bought it right then. And the distributor has since picked up other customers,” says Noal.

Put yourself in a farmer's shoes, says Holland. The typical farmer doesn't like to be government-subsidized; he's an independent guy and would rather do it on his own. If there's something he can do that isn't incredibly cost-prohibitive, he'll jump on it. By going with soy diesel, he can take part in something and make a positive difference.

“This has to start in ag, but farmers are hardly the only ones who would benefit from more soy diesel use. Delta towns are dying, and they're intricately meshed with the ag economy. Surely municipalities and Delta residents, if they knew they would be helping their neighbors and communities, would be happy to use soy diesel as well. How about (trucking companies), state employees, on and on?” says T.J.

It takes 1.4 bushels of soybeans for every gallon of soy diesel produced. Statistics show that if the country would use just a 1 percent blend of soybean diesel with on-road diesel fuel, it would eliminate 250 million bushels of soybeans — the carryover number from last year. Further, at that rate, some 300 million gallons of bio-diesel would be needed and would, according to USDA studies, add a minimum of 35 cents per bushel to soybean prices.

“Our next conversation on this is with several state representatives. We've hired a lobbyist to work on this with us. He's going to help us figure out if legislation can be passed to get this going. This just makes sense. We need a groundswell; we need the ag industry to show politicians they're interested in this. Politicians need to hear questions about bio-diesel at every meeting they hold. This can be done. It's a simple way for everyone in the state to help maintain our ag base,” says Noal.

Editor's note: For more information on bio-diesel, check

e-mail: [email protected].

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