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Eastern Opportunities: WIU Student Examines Russian Market Ops for Ethanol Co-Product DDGS

December 10, 2009


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MACOMB, IL -- While many individuals get their first exposure to international experiences as college students, it's not so often that they participate as one of the lead researchers on an international research trip to help investigate and foster emerging markets for U.S. products. But soon-to-be WIU graduate Anthony Staggs found himself in just such a role this past August, when the senior marketing major at Western Illinois University traveled to Russia with WIU School of Agriculture faculty John Carlson and Kevin Bacon. The purpose of their trip: to present the possibilities of DDGS (distiller's dried grains with solubles) -- a co-product of drymill ethanol production -- for high-protein feed for Russian livestock.

Along with Carlson and Bacon, Staggs, a Chicago native, traveled to the Russian cities of Moscow and St. Petersburg, among others, to gather information about Russian livestock feed practices and to provide Russian livestock-industry professionals with information about the benefits and availability of DDGS from ethanol producers in Illinois.

"Right now, about 80 percent of the livestock in the U.S. are being fed this product," explained Carlson, professor in Western's School of Ag. "If Illinois-based ethanol producers want to expand the ethanol industry, they will need to find ways to utilize the remaining available supply of DDGS. It also would help keep the price of ethanol competitive, as producers would have a way to utilize the co-product. I've been to Russia numerous times, and based on my experience there, I have become aware that they need a good, high-protein livestock feed. They really just don't have one," Carlson explained.

According to the U.S. Grain Council's "DDGS User Handbook" (available at www.grains.org/ddgs-information/217-ddgs-user-handbook), DDGS is a valuable feed ingredient. The introduction of the handbook states: "In ethanol production, the starch is fermented to obtain ethyl alcohol, but the remaining components of the grain kernel (endosperm, germ), preserve much of the original nutritional value of the grain, including energy, protein and phosphorous. Drymill plants recover and recombine these components into a variety of animal feed ingredients. DDGS is a popular dried form of these combined components, available to domestic and international customers as an ingredient for livestock and poultry rations. As the U.S. ethanol industry continues to grow, a greater quantity of DDGS will be available for feeds in the domestic and export market and a wider diversity of distiller's co-products with different nutritional characteristics will become available for specific animal feeding applications."

Eastern Opportunities
The trip to Russia, DDGS Russian market research and resulting marketing plan, according to Carlson, are the result of a sub-grant awarded to Carlson via the Illinois Institute for Rural Affairs (IIRA), which is housed at WIU.

"The funding from the IIRA was provided through a grant its Illinois Value-Added Sustainable Development Center received from the Illinois Department of Commerce and Economic Opportunity," Carlson noted. "The grant award was based on our proposed investigation of the possibilities for alternative energy forms, specifically ethanol. With the funding we received, we examined DDGS and the possibilities for Illinois ethanol producers, DDGS and the Russian livestock industry."

Staggs became involved in the project through a marketing research class, taught by John Drea, chair of Western's marketing and finance department, which, along with the School of Agriculture, is part of the College of Business and Technology at WIU.

"This project started out as one that would involve Dr. Carlson and me," Drea said. "When it became clear that the Russian trip wasn't going to work out with my schedule, Dr. Carlson's first question was, 'Do you have a student who would be a good fit for this?'"

Drea did have one undergraduate student in mind.

"I thought about Anthony almost immediately. He is extremely bright and very detail-oriented," Drea said.

Staggs noted that while he had never been out of the country before the trip with Carlson and Bacon, he felt prepared via Carlson's help.

"I still experienced a little bit of culture shock, but Dr. Carlson shared some of his experiences with me, and that helped me prepare for the trip. He provided information about various cultural differences and language-barrier issues; overall, he provided me with some really good know-how tips. And then there was the fact that I'm not an agriculture major, so I also had to deal with some of the terminology issues in regard to agriculture and marketing," Staggs said.

Despite the barriers, Staggs was able to provide Carlson with significant help during the 12-day trip. He not only delivered presentations, he also helped tweak the survey instrument designed by Carlson and Drea.

"The survey basically serves as the backbone for the marketing plan. We needed to gather data about what other kinds of feed sources they currently use and what would it take for them to switch from one thing to the other," Drea said. "So Dr. Carlson and I worked on that, and I brought Anthony in as well. He made some additional editorial changes to the survey we designed. That's always kind of an adjustment process, frankly, for the professor -- to have the student giving you a critique on what you've developed. But that has to happen for a student in a project like this. Anthony had to be able to step out of that student role and collaborate as an equal participant," he added.

Throughout the fall semester, Staggs has continued his work on the marketing plan for Illinois-based ethanol producers, DDGS and the Russian livestock industry. As of mid-November, he was busily reviewing secondary resources to help him validate the primary data obtained through the initial survey. While the survey didn't result in as much primary data as Carlson and Staggs initially hoped for, Carlson noted the trip provided them with a valuable opportunity for establishing contacts in Russia and has indeed resulted in significant interest in the project.

"Overall, I would say the response has been really positive," Carlson said. "We have three or four companies that are pretty serious about buying DDGS from Illinois-based ethanol producers."

As for Staggs, the trip and research project not only provided him with a valuable hands-on learning opportunity in his field of study, it also gave him a memorable way to start off and end his final undergraduate semester at WIU. He will finish his bachelor's degree after just three-and-a-half years studying marketing at Western. He noted that his future plans will likely include the pursuit of a master's degree in sport management.

"This was an amazing opportunity for me. I found it to be a very eye-opening trip, and it has provided me with practical experience that I will be able to utilize in my future education and/or career plans," he said.

For more information about the project, contact Carlson at (309) 298-1611 or JP-Carlson@wiu.edu. To learn more about IIRA's Illinois Value-Added Sustainable Development Center and its ethanol-related research and projects, visit www.value-added.org/renewableEnergy/ethanol.

Posted By: Teresa Koltzenburg (WIUNews@wiu.edu)
Office of University Relations