Biofuels: Advantage WoodOverlooked as 2011 is the news that tax breaks for cellulosic biofuels, e.g., gasoline, diesel and jet fuel from pine and wood waste, were retained while corn-to-ethanol subsidies disappeared at the end of 2011.

Through multiple administrations, the Federal government has maintained support for biofuels, with Brazil's sugar-cane-gasoline success viewed as a paradigm of its potential. In fact, Federal agencies are required to buy gasoline with biofuel-based ethanol mixed in.

A shortage of biofuel has resulted in a $6.8 million penalties assessed against transportation fuel suppliers to the U.S. government. They say they can't find biofuel on the market - the refineries are still in development stage - and so they simply pay the penalties.

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Yesterday U.S. Agriculture secretary Tom Vilsick reaffirmed the Federal governments intention to continue supporting biofuel development - allowing regional variations on the feedstocks. Vilsick said he envisions Florida refineries using citrus waste; Midwestern refineries using non-food feedstocks like corn cobs and switchgrass; and Northwest U.S. fuel makers processing woody biomass from local forestry plants.

Cellulosic fuel producer Poet, Inc. estimates there are over 1.3 billion tons of biomass available for ethanol production. "We can replace all gasoline made from imported oil," the firm asserts.

Concern has been expressed that use of woodwaste for biofuel will be diverted from particleboard and plywood plants, hiking wood panel costs. This could be one reason stories about biofuel are among the most viewed reports at

Corn-to-fuel was saddled with controversy for its potential for driving food prices upward.

In fact, world food prices are most affected by rising demand among wealthier consumers in developing economies, so much so that U.S. corn farmers pretty much didn't notice the elimination of the corn biofuel break at year end.

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