ADM CEO says long-term goal is non-food biofuels

DES MOINES Thu Oct 15, 2009 8:55am EDT

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DES MOINES (Reuters) - The long-term goal for the biofuels industry will be to use nonfood sources for raw materials rather than grains, but to reach that goal industry must build on and not abandon current technology, biofuels giant Archer Daniels Midland said on Wednesday.

"My belief is agriculture can contribute to both -- both higher food production and these other elements of the food chain that contribute to other ingredients in our daily life including fuels," ADM Chairman and Chief Executive Officer Patricia Woertz told reporters at the World Food Prize forum.

"But it won't be the only platform. It will probably be a more advanced technology of second and third generation that are not food-based fuel substances," she said.

"The only way to get from where we are today to the longer term, which will be made from nonfood products, is to continue the technology and the work related to the first generation," Woertz said.

ADM, the largest corn processor in the world, is a top producer of corn-based ethanol and soybean-based biodiesel. ADM has also been a leading advocate and lobbyist for subsidies to nurture and build the U.S. renewable fuels business.

Woertz, who took over leadership of ADM in April 2006 after a career of nearly 30 years in the oil industry, has staunchly defended the use of crops to produce fuels. ADM has five U.S. ethanol plants with another two planned that will raise its total production capacity to 1.65 billion gallons a year.

Food aid and hunger relief advocates have variously called biofuels immoral, inflationary for world food prices, and no real weapon in cutting emissions of global warming gasses.

But Woertz said renewable fuels were here to stay and even have a role to play in hungry, developing economies.

"What agriculture can contribute in the longer term and even in the shorter term for some developing nations would be the opportunity to provide them both with food and fuel, potentially energy for heat, for light," she said.

While corn and soybeans account for most of the raw material for world biofuels output, Brazil's large ethanol production is mostly sugar-based.

Research and investment into nonfood biofuels feedstocks, from switchgrass to wood chips and other forms of cellulose to biomass waste, is a hot area for investors.

(Editing by Christian Wiessner)

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