Ethanol

Profit margins for the ethanol industry have been in negative territory for 2012, resulting in the closure of more than 20 refineries. The cause of the problem is the high cost of corn, due to the drought-shortened crop and the inability to find adequate supplies of corn to continue refining. The U.S. ethanol mandate is keeping production going, despite the economics, and without that, ethanol content in gasoline would be cut to 3-5%....More

The Energy Independence and Security Act of 2007, commonly referred to as EISA, amended the Federal Renewable Fuel Standard (RFS) by mandating specific quantities and types of renewable transportation fuels for each year – known as the yearly "applicable volume." The applicable volume for a particular fuel (conventional biofuel, advanced biofuel, cellulosic biofuel, biomass-based diesel) determines the quantity fuel refiners, importers and blenders much purchase each year. The below graph illustrates the statutory legal requirements for renewable transportation fuels under the RFS....More

A full waiver of the Renewable Fuel Standard’s (RFS) conventional biofuel requirement might reduce corn prices by just 0.5% (4¢/bu.) in 2012-2013, according to a new analysis conducted by the Food and Agriculture Policy Research Institute. The study also found corn ethanol production might slip by just 1.3% with a waiver in 2012-2013, while corn available for livestock feed might increase just 0.6%....More