Tim Plaehn

Ethanol: Our Answer to Reducing U.S. Dependence on Foreign Oil

Mr. Eye. When you put gas in your car do you figure the energy equivalent basis or just gallons and price? People mostly just care how much it costs to fill up and if they are filling with U.S. produced fuel at a lower price they feel pretty good about it.

Ethanol: Our Answer to Reducing U.S. Dependence on Foreign Oil

My bad, although it took 30 comments before someone pointed it out. Annual gas consumption should be 140 Billion gallons. I have also read 180 billion gallons, but I took the number from the last source I was using.

For all of you sugar fans, did you read U.S. Sugar gave all of their Florida sugar land back to the U.S. government to stop the destruction of the Everglades.

Using E-blends greater than 10% voids a new car warranty. After the warranty period it does not make a difference. How many diesel pickup owners run biodiesel in their trucks (against warranty)? Google it sometime.

Mr Eye: At current total production of 9 billion gallons per year every gallon is being bought immediately and ethanol imports from Brazil are growing rapidly and will exceed 700 million gallons for 2008. And 10% is 10%. No equivalent anything. 10 gallons of ethanol + 90 gallons of gasoline. Coming to every gas station near you!

Is the Ethanol Mandate Likely to be Repealed?

Back again.

I am happy that my investment in VeraSun Energy is up 65% in the last 5 weeks.

And Mr. Subsidy Eye, I see you are Swiss based. Are you interested in U.S. investing or using Seeking Alpha for another agenda?

Is the Ethanol Mandate Likely to be Repealed?

Subsidy Eye,
I appreciate your comments on my "analysis". You have valid points. I will reply on the acreage note, looking at the graphs is is fairly obvious that from 06 to 07 farmers elected to plant corn instead of soybeans. Note that soybean acreage fell quite a bit. I grew up in Iowa and farmers their plant either corn or soybeans depending on what they believe will be most profitable. Also, the first graph in you link shows total planted acreage for all crops pretty level for the last several years and well below the amount planted in the 1980's.

In regards to Brazilian ethanol I find it very hard to believe that the U.S. Congress would ever pass legislation that would benefit Brazilian agriculture at the disadvantage of U.S. farmers. Think about it.

Is the Ethanol Mandate Likely to be Repealed?

Has anyone figured how much more energy farmers are using to harvest the same amount of corn that they harvested before ethanol became a major user of corn. I would guess that energy usage in the farm belt has not changed since the ethanol boom. The corn raised is just going for a different purpose. The same number of corn acreage is still being planted.

Since this is a stock market blog: buy VeraSun Energy, VSE, enjoy the boom.

Final note, at the present time Brazil has enough excess ethanol capacity to provide less than 10% of the U.S. demand and are already shipping most of their excess capacity to the U.S. It would take them several years to tear up enough rain forest to plant enough sugar and build enough plants to make a major dent in the U.S. usage.

Majority of Americans Support Ethanol

A note on the "prairie land" also. U.S. farmers currently plant 80-90 million acres of corn. Just after WWII there were over 140 million acres of corn being planted! In the same time period yields per acre have increased 5 fold. Corn yield are expected to double in the next 10 years, making ethanol a more cost effective fuel.

Majority of Americans Support Ethanol

Coming from a farming background and investor in VeraSun Energy I am all in favor of windfall profits for farmers and ethanol producers. Still waiting on the ethanol side.

Majority of Americans Support Ethanol

I appreciate all the comments to my post. This is a volatile subject, but I do not see the U.S. government abandoning corn ethanol in the near future. At this point it is our only commercially viable renewable motor fuel. And how many of you really think the U.S. Congress would vote to take a tax benefit away from U.S. farmers and at the same time give a tax reduction to foreign ethanol producers. Sounds like a good way to not get reelected!

Are We at the Bottom of the Ethanol Barrel?

A couple of notes:

I Brazil the minimum amount of ethanol in gas is 20% and fuel stations all also offer 100% ethanol fuel.

IMO the crush spread is now controlled more by ethanol prices than corn prices. The spread will stay between $1.00 and $1.50 per bushel and corn will fluctuate with ethanol. Ethanol production controls about 30% of the corn crop and will stop buying if their spread narrows, causing corn prices to fall. Corn could still fall, widening the spread of there is too much corn, but corn prices will not be able to overwhelm ethanol pricing for any length of time.

The U.S. is steadily moving to a point were all gas is 10% ethanol. The economics just make too much sense. That works out to about 18 billion gallons per year, double current production. At this time, there are no other viable sources besides corn and a few other grains like barley. Brazil could provide 500 million gallons max without out a serious, and expensive, ramp up of their production.

Coming Soon: Global Corn-for-Sale Signs

How about a link to the information? I would like to dig deeper into this news. Over projections of ethanol corn use leading to reductions in estimates?

Ethanol Will Become a Fad Without Government Intervention

Ethanol is the only blending source for cities that need to meet clean air requirements. There is much focus on ethanol as an alt. fuel, but few realize it is necessary to meet EPA clean air requirements for many areas.

Increasing Ethanol Demand and the Likely Price Implications for Corn

Nice informative article. I would like to see a comment on yield/acre trends. The big factor this year will be weather. I know it always is, but the very tight stock situation makes it even more so.

It's Now 'Official': Ethanol Is a Scam

A comment on the cutting forests to plant more corn to make ethanol argument. In 1932 the U.S. had 113 million acres of corn planted. Now the typical crop is 85 to 90 million acres. Who dug up the corn fields to plant trees?

Corn yield improve every year and strains are developed to increase sugar content. Ethanol plants are getting more efficient, more ethanol from less corn using less water and energy. It is the American way to improve business efficiency. Ethanol companies will do the same. And when cellulosic ethanol becomes economically viable companies like VSE and ADM will be the leading producers because the will have the infrastructure to produce billions of gallons at the lowest cost.

It's Now 'Official': Ethanol Is a Scam

So we are responsible for feeding Africa. Maybe they could learn to grow their own food!

Right now ethanol reduces our gas consumption by about 4%. It supplies jobs for 1000's of people. Farmers are making good profits and buying machinery, supplies, cars & trucks. Too bad this "scam" provides a good living to so many people!

Pacific Ethanol: Juicy Details From Tuesday's 10-K

A couple of comments. Most of the cars and trucks produced by GM will now run on E85.

Only 10% of the corn crop goes into food. The balance is livestock feed and energy. There is 5 cents worth of corn in a box of corn flakes.

A poorly run company like Pacific Ethanol going out of business is only good news for a well run company like VeraSun. All of the gas in the U.S. will be E10 shortly.