[MilitaryMan19D30]

Who is buying up the corn to convert it into ethanol fuel? This may sound like a 3rd grade question but I read an article in the newspaper that mentioned corn sells going up because of the ethanol fuel surge.

[labman]

Some of the plants may be buying directly from the local farmers. In other cases I am sure it is going from the grain elevators to the established grain brokers and traders. I am sure the big ones like ADM are heavily involved.

[dMacII]

Check out this list of fuel-alcohol production plants. The listed group produces between 1.5 and 2 (maybe more) billion gallons of ethanol for fuel each year.

I helped design the Tate & Lyle plant in Loudon TN. This plant also produces high fructose corn syrup. Between the two products, unless the plant has been expanded, the plant consumes 800 acres of corn every day, most of it going to the HFCS, which in turn goes into non-diet soda ("pop" for some of you readers) and a lot of baked goods and prepared foods.

I have relatives who operate grain elevators. The local fuel ethanol plants are buying up all the corn that nearby elevators can supply. Some of the big producers build their own elevators and contract with local farmers... they also have their own people who buy corn futures.

[TheSavage]

Sad funny part is -- from what I read a few years ago -- hemp would produce more fuel per acre.
-- Savage
Edit -- a bit of interesting history I just found
The Car Grown From the Soil. . .

[MilitaryMan19D30]

Is this the next big market? I know ethanol fuel has been around for awhile but is the demand catching up?

[dMacII]

Big market for corn? - probably "yes", for the short term (10-15 years).

Big market for investing? - may be a good investment for a co-op or for someone investing in a fuel-ethanol plant... as long as the feds keep subsidizing fuel ethanol; and as long as the feds keep out imported EtOH (ethanol) made from sugar cane (mostly from Brazil). The sugar cane process is much more efficient, so the fuel EtOH from it is less expensive. I think the present tax on imported fuel EtOH is $0.33/gal.

Also, Ethanol provides less actual burnable fuel per gallon compared to gasoline... and it really is not better for the environment. So it will only be a matter of time till EtOH goes out of favor and is replaced with gasoline (but more efficiently burned than in today's engines) or electric power or some other form of energy.

If you invest in some way in fuel EtOH or in corn or corn futures, you better continuously watch closely which way the political wind is blowing.

[v-star]

I work for one of the largest ethanol Company's in Canada, So why would you want to know about corn and the ethanol ?

[TheSavage]

Still doing a bit of reading on this and stumbled across this Capitol Hill Blue - Another Broken Bush Promise as President Screws American Farmers

Good to know that the whitehouse is looking out for the small farms. {not} -- Savage