Carly Helfand co-wrote this report.
Pressure is mounting on the Food and Drug Administration to change how it regulates the use of antibiotics in ethanol production after a recent study showed traces of antibiotics in distillers grains (DGS), a byproduct of ethanol production that becomes feed for animals.
The concern is that unnecessary exposure can lead to drug-resistant bacteria, prompting some to call for further regulation – or prohibition – of antibiotics. But increased FDA control could potentially put some smaller pharmaceuticals producers in hot water and mean more setbacks for an already shaky ethanol industry.
“There’s no guidance and no one is monitoring the use,” said Julia Olmstead of the Institute for Agriculture and Trade Policy (IATC), who wrote a report May 1 detailing a University of Minnesota study that found traces of antibiotics in DGS . “It’s really up to the plant how much they use, and there’s no tracking.”
May 11, Sens. Edward J. Markey (D-Mass) and Louise Slaughter (D-NY) sent a letter to the FDA expressing concerns over ethanol-related antibiotics resistance. Olmstead says her trade policy group and others are also considering legal action to spur the FDA.
“I do think we’ll start to see some action from the FDA,” Olmstead said. “They’ve spoken in the past that they plan to issue some guidances about it in the near future, so I hope that it happens, and I think that it will.”
The Minnesota study found that 89 percent of samples of 159 DGS samples contained antibiotic residues, including penicillin and erythromycin, both commonly used by humans, and tylosin and tetracycline, neither of which has been cleared by the FDA for use in ethanol.
The FDA states on its website that “it is well established scientifically that all uses of antimicrobial drugs, in both humans and animals, contribute to the development of antimicrobial resistance.” Which specific product an ethanol producer chooses to use – and how much of it – are left to the producer’s discretion.
The amounts used are only increasing with the development of antimicrobial resistance, said Lloyd Schantz, the executive vice president for BetaTec Hops Products Inc., a company which markets hop-based alternatives to antibiotics.
“We’ve gone into plants where the guy will say, “I used to use 2 pounds, now I’m using 6,” Schantz said. “There’s a reason for that.”
Dr. Gerald Shurson, the University of Minnesota professor behind the study, does not consider his findings alarming. He said the antibiotics residues he found in DGS didn’t appear to have any biological activity, which speaks to the fact that “safety-wise, as it stands today, DGS is pretty safe as a feed ingredient.”
“It’s a small piece of the overall puzzle,” Shurson said. “Not to ignore it, but I think there are other issues related to antibiotics resistance that probably have a bigger impact.”
For ethanol producers, the implications of stricter regulations would be manifold. Squeezing every dollar from the raw material grains allows for ethanol to be profitable. DGS are a nutrient-rich feedstock and comprise roughly 20 percent or more of all ethanol-generated revenue. Without their sale to livestock producers as farm-animal feed, ethanol production wouldn’t be profitable for most ethanol producers.
Chris Hurt, an extension agricultural economist at Purdue University, said being unable to sell DGS tainted with antibiotics would “have major implications” for the industry, as any extra cost brought on by higher regulatory bars has the potential to strip away narrow profit margins.
“Ethanol producers currently have negative margins without distillers grains value in there,” Hurt said. “They would be shut down if they were unable to sell distillers grains and, secondly, had to pay to have them disposed.”
With increased regulation, ethanol plants could also incur potentially higher costs for a non-antibiotic solution. In addition, cleanup or infrastructure updates might be necessary at older, heavily exposed plants to eradicate the existing bacteria.
“It would cost more or they would have to make some infrastructure changes,” Olmstead said.
Conventionally, ethanol producers have resorted to antibiotics to prevent bacterial outbreaks from occurring during the distillation process. In the fermentation tanks, yeast vies with bacteria for sugar. If the bacteria prevail, the final ethanol product is soured to an inferior quality or altogether ruined.
“If an ethanol company has a bacterial contamination, the financial cost of that is quite high,” Shurson said. “Depending on the length of time that this problem persists, it could result in thousands of dollars of loss in ethanol production or ethanol yield.”
Increased regulation or a ban on antibiotic use could also spell trouble for some chemical companies– including Phibro Animal Health Corp. The New Jersey-based company is the producer of Lactrol, which Schantz called the most widely used antimicrobial in ethanol production.
The company declined to comment, but in a 2009 statement, Phibro asserted that its Lactrol sales had been made to “far greater than 55 percent” of the then-currently operating ethanol plants. Today, Schantz estimates, Phibro’s market share is about 80 percent.
Phibro is the only producer of Lactrol’s active ingredient, virginiamycin, which was declared Generally Regarded as Safe (GRAS) in 2010 for use as a processing aid in the production of ethanol and DGS. But if antibiotics were no longer permitted as a part of ethanol production, regulatory effects could be felt financially.
“For the antibiotics companies, obviously if the plants reduced the use or stopped using them, that would have a pretty big impact on revenue and profitability,” Shurson said.
Schantz said that antibiotics typically run from $100 to $120 per pound, with producers using a rough average of 3 pounds per fermentation cycles. With the typical 100 million gallon plant doing between 950 to 1,000 fermentation cycles a year, that’s between $300 and $400 thousand dollars of revenue lost for each plant that stops using antibiotics, he said.
Antibiotics producers may already be starting to feel these effects as plants voluntarily make the transition to antibiotics alternatives, such as increasingly popular hop-based products. Schantz said his company, BetaTec Hop Products, is steadily gaining customers, especially since POET LLC, which comprises 27 ethanol plants nationwide, made the commitment to go antibiotics-free in mid-2011.
“There’s always been a segment of the market that’s been reluctant to use antibiotics for whatever reason,” said Scott Gemmell, a Sales Manager for the Ethanol Performance Group who is responsible for sales of Lactrol. “Whatever their beliefs are, real or perceived, they use a non-antibiotic solution.”
Shurson said that antibiotics are “useful tools,” cautioning that DGS yield could be threatened by a total absence of antibiotics in a plant in the event of an infection, which hop-based substitutes may not be able to combat.
“The company loses multiple ways – loss of production, reduced value of its distillers grains, and all the other labor and costs to get back to where things should be operating normally,” Shurson said. “It’s a pretty significant factor.”
Still, he said, the ethanol industry needs to “get a little bit smarter” about when and how antibiotics are used and “continue to explore other alternatives.”
“There’s no doubt that we need to raise questions about antibiotic use and be a little more prudent and smarter about how we use them in the future,” he said.