Lower Ethanol Prices Fuel Strong Blending Demand

The CEO of the American Coalition for Ethanol says the biofuels industry is in a good place. “Overall, the health of the industry I think is very strong right now.”

Brian Jennings says that’s despite low ethanol prices.

“It makes ethanol blending so attractive; ethanol is trading wholesale about $1 under gasoline.”

Speaking during the ACE Ethanol Conference in Minneapolis recently, he said domestic blending rates are very robust.

“That’s helpful to the ethanol plant’s bottom line.”

And Jennings says strong Renewable Volume Obligation targets for advanced biofuel have boosted prices for distillers corn oil and other products produced by ethanol plants.

EDITOR’S TAKE:

Higher oil and gas prices have propelled the use of ethanol to help reduce the overall impact on consumers at the pump. Higher prices for some of the byproducts from the distilling operation are also making ethanol more attractive to the plant producing it. In addition, greater use of ethanol is definitely helping support higher corn prices at the farm level. It appears this is an excellent window for all concerned. We hope this trend will continue so row crop farmers can finally see daylight at the end of what has been a longer than anticipated tunnel of low commodity prices.

However, many row crop producers would appreciate knowing that you offer CADFI. It is a program designed to coordinate payments with the farm income schedule. Whether their revenue comes in monthly, quarterly, semi-annually or even annually, CADFI can design a payment schedule to match. It’s a wonderful program for you and your ag customers.