Here are today's biggest stories surrounding the sector:
- News of corn reaching an all-time high caused pure-play ethanol stocks to tumble Tuesday. VeraSun was the biggest loser as it dropped $1.18 (13.21%) to a 52-week low of $7.75 a share. On the CBOT, March corn retreated 12.4 cents to $5.43 per bushel (on profit-taking) while March ethanol dropped only .001 cent to $2.400 per gallon.
- Guy Caruso, the head of the EIA, stated today that "quantities of cellulosic ethanol prior to 2022 will be insufficient" to meet the 36 billion gallon requirement as there has yet to be an efficient way of production. Cellulosic ethanol is responsible for contributing nearly half of the mandate. Caruso estimates that only 32.5 billion gallons will be reached by the target date.
Good news, though, is that the USDA and DOE announced today that they will invest up to $18.4 million in several projects aimed at improving the process. It is important that we get such funding as Ethanol will not last if we cannot produce it cellulosically.