Fallout of LOW fuel prices

[helmsdale]

Ethanol is going to get cranked!

If the US grows a corn crop this year, and ethanol producers go tits to the sky what happens to feed grain prices?

Even if they stay afloat, the seriously subdued demand still shifts significant product onto the feed market?

Will exports take up the slack? Who's gonna be buying?

[GDR]

Ethanol is going to get cranked!

If the US grows a corn crop this year, and ethanol producers go tits to the sky what happens to feed grain prices?

Even if they stay afloat, the seriously subdued demand still shifts significant product onto the feed market?

Will exports take up the slack? Who's gonna be buying?

I hear what you are saying, but not sure it was really market driven before. Mostly mandated by governments for min blends. Trump could change levels but that would be against the US farm community that is part if his base. Dont think it's an issue.

[helmsdale]

I hear what you are saying, but not sure it was really market driven before. Mostly mandated by governments for min blends. Trump could change levels but that would be against the US farm community that is part if his base. Dont think it's an issue.

Think fuel usage, in particular gasoline... it has plummeted! Even with mandated blends, a smaller piece of the pie is still smaller. Couple decreased volume with a price decline of -30% y/y and I'd think it's safe to say margins are tight if not negative...

[helmsdale]

[AlbertaFarmer5]

But the demand for byproducts ( DDG's specifically) hasn't dropped, may even increase, and it isn't quite clear where that demand will get filled if ethanol grind drops. Could it reach a point where the byproducts are worth enough that they keep grinding and finding home for the ethanol as a by product, at any price?

Or should we all grow pulses and oilseeds and try to fill the protein void with that instead?

I said from the start of this, that the US can and likely will close their border to oil imports, or even set a floor price. Sounds like many US politicians are now calling for that as well. And right or wrong, they do look after their farmers, so expect to see ethanol mandates adjusted or at least enforced to keep the volumes comparable, no point in paying producers to grow a crop, if there is no market for it, when they have the power to create the market.

Of course, a couple of months of no one driving gasoline vehicles, especially if this drags out into summer vacation season, is a lot of demand that will never come back, will ethanol be mandated a bigger piece of the smaller pie to keep it propped up?

[ajl]

It is the no driving that will get ethanol and lead to corn inventory rising so this threat is real. The lower production of DDG's will benefit soy meal primarily as the ethanol process concentrates protein. Our only hope is for prevent plant both in the Dakota's and here are home. With winter weather back in the forecast this week there is sure to be unseeded acres this spring so the monster corn crop will not be all planted. Some parts of South Dakota needs a helicopter because roads are impassible from pictures on AgTalk.

[Braveheart]

The Small Refiners Exemptions under the corrupt EPA mandates also puts ethanol under pressure. Trump has been a friend of big oil.

[bucket]

Since Federated bought Terra Grain Fuels ...it will probably be an excuse as to why they can't send better cash backs....

Ever notice there is always an excuse...

Use to be the high price of natural gas was the reason for high fertilizer prices....then that dropped they started using supply and demand ...now its the lack of application on US farms last fall...