Posted 8/14/2010 00:45 (#1314688 - in reply to #1314677) Subject: Re: $5 corn?
DTN: Current ethanol margins are so tight that the complete removal of the 45-cent blenders credit would make production not profitable for many companies. Purdue University professor Wallace Tyner did an analysis in recent years that focused on who benefits from the blenders credit. His conclusion was that without the credit ethanol producers would receive about 45 cents less per gallon on the price of ethanol. Do the math. DTN's hypothetical ethanol plant is recording about a 16-cent loss on net profits. Built in is 32 cents of debt service per gallon of ethanol produced. So if the plant wasn't in debt it would be making about 16 cents per gallon. If 45 cents is eliminated off the ethanol price, an ethanol plant no longer paying debt would be taking about a 29 cent loss per gallon. (Todd Neeley)
$5 corn?
