Wheat vs. Coal

[Vader]

Hard coking coal is worth $150.00 per tonne. Not sure what lignite is worth compared to hard coking coal but the heating value of lignite is lower than wheat. Lignite has about 6600 Btu/lb. and wheat (grain) has about 8700 Btu/lb.

What would our wheat be worth to a power station down at Estevan, Saskatchewan. Lots of frozen wheat weighing 50 lb per bushel and less in S.E. Saskatchewan. Rather than spending $125.00 per tonne to get it to South Korea for livestock feed and in effect subsidizing the people of South Korea lets just burn it.

$150.00 per tonne for 50 lb feed wheat sounds pretty good to me!

[JD4ME]

Here are some numbers based on some rough research, a tonne of coal produces approx 13 million btus of energy, all coals are different so this number is variable.
A tonne of Wheat from what I can gather based on 60 lb wheat should be in that 18.5 milllion BTU's range.

I'm not sure of the current price of coal Im thinking in that 20 -30 dollar range per tonne, I think I got this fairly close but the research was quick and the calves are calling.......

[Vader]

JD4ME - where do you find the price of coal at $20-30 per tonne. Price of coal is moving upward very rapidly.

I believe natural gas trades in units of Million cubic Feet (MCF). How many BTU's in a MCF of natural gas and what is the value of natural gas today?

[JD4ME]

Back in from feeding for a minute here.
No I didn't phone anyone I pulled an old number of the web theres no doubt its moved up alot the old number I got was 18 and I figured it was wrong the 20-30 was purely a guess the BTU numbers though are relatively accurate I believe.

What is the current price of coal in central sask? I'd like to know too , I've been eyeing the grain burning stoves and heaters real closely the last couple years wondering about it. It's not the cost of the gas so much its all the "extras" that they throw on the bloody bills that is the true overpricing I'm seeing.

[JD4ME]

I made a call ,dry stoker coal is 30.25 a tonne at luscars sheerness mine today.
My guess at 20 -30 wasn't too far off but theres a number to work with anyhow, remember though different coals have different BTU's but its a good thought. Again roughly but coal at present prices then is .000002326 per btu.
Wheat at 2.00 (73.40 a tonne) is .000003963 per btu. I'm thinking feed wheat would have to be closer to 1.20 a bushel to make it work.
Feel free to tell me if I'm wrong it has been known to happen.
I'm afraid it still cheaper to burn coal. However on farm with all the extra fees it may be closer.

[Vader]

Not too encouraging about the price of coal at Luscar.

I checked with a friend at SaskEnergy. I was wrong about MCF. It is not a million cubic feet. It is a thousand cubic feet. One MCF is almost exactly equal to one GigaJoule. One cubic foot of natural gas is 1000 Btu so one MCF is 1,000,000 Btu. Today's price for one MCF of natural gas is $7.19. Not sure if that is sustainable. It was $2.50 just a couple of years ago and $5.50 a couple of months back.

Obviously natural gas is an attractive form of energy because of the ease of use and being environmentally friendly. A straight across comparison of 1,000,000 Btu for $7.00 would mean that wheat at 8700 Btu/lb would be worth 6.09 cents per pound of $3.65 per bushel.

I suspect that the price of lignite coal at Estevan is not as volatile as the market for natural gas. Not too many alternative uses for the lignite.

I wonder how a blend of lignite and feed wheat would work in the boilers. They pulverize the lignite and blow it into the boilers. In this way it ignites immediately. Could you simply add a percentage of wheat to the lignite in the pulverizer? Would $2.00 per bushel (73.46 per tonne) work for a producer near Estevan or Coronach? Perhaps Saskpower would consider this under their "Green" energy program and provide a subsidy for the wheat to bring it up to $2.50 per bushel. It would be a great public relations exercise for the Saskatchewan Government. How about Kyoto? Burning wheat should be worth some carbon credits for Sask Power.

[seedsman]

Checked with a neighbor that's using coal in a greenhouse and barn. Had already checked out the feed wheat idea. Said he would have to buy wheat for $40/T to compete. Coal works out to the same price as NG @2.75.

[Vader]

seedsman

What do you mean "Coal works out to the same price as NG @2.75. "

How long ago did your friend check out this idea? Natural gas and coal prices are moving up rapidly.

[seedsman]

What he meant was that the last coal he bought for $30 plus freight, cost him the same for heat compared to natural gas costing $2.75. So his energy costs for coal now are less than half of what it would be if he was using natural gas.

[Vader]

I wonder how fast SaskEnergy adjusts their rates to reflect the daily prices. As I mentioned I spoke to someone there who told me that yesterday's spot price was $7.19 CDN for natural gas. If your friends coal price has remained stable his now now paying only 1/6th the spot price for heating with coal vs NG.

Luscar's cost for producing coal has probably not risen substantially and they are probably tied into a long term contract with SaskPower. I wonder if they have some kind of a pricing arrangement linked to some futures market.

[grassfarmer]

I know you guys are looking for new markets for wheat but doesn't sustainability come into this somewhere?
Wouldn't it be madness to use finite fuel resources to grow wheat on the prairies and then burn it as a replacement for fossil fuels?

[ianben]

Heres the first listing from my post posted Oct 22, 2004 15:13 Oil vs Wheat Lots about sustainability down there still on list near bottom. Oil has again reached even higher highs recently so wheat/crops as a fuel must be an option.
Local coop is looking at a Danish canola press. Oil as fuel mix with diesel and meal into hog rations.All very local!!
At present canola/diesel prices numbers look fantastic.
--------------------------------------------------------------------------------
As oil reaches new highs daily and Tom and Charlie talk $50-$70 feed wheat.
Where do these two prices meet?
What is energy value of a ton of wheat using current oil price.
Can you replace that tonne for $50-$70 next year with higher fuel and fert costs.

We are in same position here Poor harvest weather lots of feed wheat £50 -£70/tonne fuel up from 15p to 25p and climbing N from £110 to £151 and climing.

No way can I replace the wheat in the bin for todays sale prices.

Price update 22/3/05
feed wheat £70
N £170
Fuel 31p/litre

[Vader]

grassfarmer,

as long as we are growing a commodity that people do not perceive as having "energy" value, then high input costs relating to energy will continue to hurt us.

When the world recognizes that our land is actually useful for its ability to harvest the energy of the sun then high energy costs will be our best friend.

I admit that right now burning our wheat may not be very attractive. In the future that may change. Right now I am simply interested in the mechanics of the process.

My belief is that we must IP our milling quality wheat and remove it from the bulk pooling system. We would then be free to move away from the KVD system and allow plant breeders to develop the full yield potential of both milling and non-milling wheat.

For those wheats that will be used as livestock feed or ethanol (or burning in thermal generating stations), higher yields will be the key to successful competition with corn.

[parsley]

Grassfarmer,

Good Point! It would be "madness to use finite fuel resources to grow wheat on the prairies and then burn it as a replacement for fossil fuels."

But from the Wheat Board's point of view, you would have the Federal Government's Wheat Board marketing grain to say another Government entity, SaskPower.

Adam Smith couldn't live on what he'd get, but the per diems for the CWB itself could then go up, their jobs would be guaranteed, and they could open an entire CWB Environmental Department to "study the effects of coal vs wheat", or "the burning effects of different varieties of wheat" etc.

Director Flaman, for example, could be appointed to oversee the entire undertaking, uncluding attending the various Liberal functions so he could speak "directly to the Minister" about the new pet venture and I am sure they could find an advertising company that would handle thinking farmers like you grassfarmer!.

Parsley

[Vader]

I am concerned about finite fuel sources for the production of all grains. Are we looking at the energy balance to see if in fact the net energy out is greater than the net energy in? It doesnt matter whether you burn that energy in a human body or burn it in a thermal generating station. There is a scientific principle at play here which gets little attention from any sector.

We are starting to feel the pinch with 70 cent diesel fuel and $360 per tonn Urea fertilizer. Wait till oil reaches 80.00 per barrel.

Somebody needs to study and understand the science. Is director Flaman the right person to work on that problem? He does have an Engineering degree. Perhaps he as the best insight to drive thinking at the governmental level. Farmers will not solve this problem all by themselves without support from various levels of policy making.

I once hears someone say that their greatest fear was that Flaman would get in there and fix the CWB.