Commercial production of ethanol in the San Luis Valley, Colorado. Final Report Page: 61 of 222
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The San Luis Valley's annual barley production of 212,578 metric tons
(9.1 million bushels) comprises 90 percent of Colorado's malting. barley and 45 percent
of all barley grown in the state. Moravian III, Klage and Steptoe malting barleys are
grown almost exclusively on a contract basis for the Coors, Pabst and Schlitz breweries.
These contracts usually encompass 98 percent of the San Luis Valley barley crop, and
are renewed annually before spring planting for delivery of the fall harvest. While this
situation appears equitable to both producers and consumers, it often creates a surplus
of barley with no purchasers. This is caused by the necessity to rotate crops to ensure
that soil nutrient depletion does not become a problem. Due to the unique growing
season in the San Luis Valley, barley, oats and wheat are the usual crops rotated.
Therefore, when a grower is anticipating planting barley and then fails to renew his
contract with the breweries, he is still committed to planting barley. He must then
actively seek a purchaser for his crop, and failing that, place it in storage. This
situation currently exists, and private barley storage from the 1980 harvest is at an all-
Barley can be stored virtually anywhere clean and dry, so most barley pro-
ducers maintain their own storage facilities. Barley and most grains can be stored
indefinitely, so it is possible for a grower to have supplies in storage from several years
previous production. This makes it difficult to ascertain specific quantities of barley in
storage. The Agricultural Stabilization and Conservation Service (ASCS) attempted at
one time to quantify the on-farm storage capability in the San Luis Valley, but most
farmers were reluctant to release such data, and since clean and dry are the only
criteria for storage, a simple estimation of grain silo sizes and capacities could not be
deemed accurate. The ASCS eventually curtailed its efforts. Therefore, while there
exists a current barley surplus, the specific quantities are unknown. As noted above,
however, this situation is unusual, and the malting barley crop is not often available to
the open market.
There are two methods to ensure that barley can be successfully utilized-
as a primary feedstock rather than an intermittent supply. One method would be for
the ethanol facility to contract with the growers as the breweries do, but on a con-
tinuous basis for inferior grades of barley that are less energy intensive to grow and
therefore less expensive. This would encourage producers to grow the "ethanol barley"
at less expense for a reduced selling price to a continuous, stable market at about the
same profit rate. As the malting barley possesses attributes which are superfluous
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Hewlett, E.M.; Erickson, M.V.; Ferguson, C.D.; Sherwood, P.B.; Boswell, B.S.; Walter, K.M. et al. Commercial production of ethanol in the San Luis Valley, Colorado. Final Report, report, July 1, 1983; United States. (digital.library.unt.edu/ark:/67531/metadc874948/m1/61/: accessed October 19, 2018), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.