The tide of support for field crop biofuels seems to be receding as quickly as it advanced. It's become routine to hear that the economics, environmental impact and fuel properties of turning grains into ethanol doesn't really add up, but I think there may still be some niche markets for it.
The Noble Foundation* and USDA are both doing some interesting work breeding forage crops that can be used both for cattle forage and biofuel. Switchgrass, made famous by President Bush's 2006 State of the Union Speech, is one of the favorites as it's native and vigorous (and has recently been shown to exhibit heterosis). However, I'm skeptical that this biofuel grass would be profitable enough to justify buying and establishing seed, let alone shipping and processing it - or that turning grass into biofuel would be more profitable than turning it into meat.
Ranching, like most agricultural businesses, has incredibly slim profit margins, so it's unlikely that straw could be shipped any farther than a few towns over to be processed. All the same, it may provide opportunities for agriculturalists to produce their own fuel, depending on oil prices. There are plenty of people heating their homes and communities by burning corn cobs and green waste from municipal parks, so I suppose there could be some market for planting these improved grasses. It's certainly aesthetically pleasing to picture widespread establishment of semi-wild, multi-use prairies, but we'll have to wait to see how the numbers work out.
Overall, I think the only way we'll see any mass produced biofuel is with engineered microbes that produce more practical fuels than ethanol, grown on some nutrient-dense, point-source, non-celluosic waste material (like sewage!). Of course this could all be moot if any of the wild prophecies of the chemists and physicists come true. Their futuristic claims of sky scrapers with painted-on solar panels and high-performance batteries are a lot more exciting than our promises of fermented corn stovers...
*This is the oil tycoon-financed research institute in Oklahoma (one of my favorite states). It's in Ardmore, one of a series of train-stop towns named after train-stop towns in Mainline Philadelphia (though many are pronounced differently!)
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