Ethanol export plans cramped by distribution network geared to U.S. market

|By:, SA News Editor

Archer Daniels Midland (ADM), Green Plains Renewable (GPRE) and other U.S. ethanol makers are banking on export markets as they deal with Obama administration plans to cut U.S. consumption requirements, but the industry is held back by a distribution structure built almost exclusively around the domestic market, according to a WSJ analysis.

The bulk of U.S. ethanol plants are located in the Midwest to be close to the corn supply rather than near shipping ports, which is driving up costs to transport the fuel.

Also, shipments to the EU have all but ended since the EU last year imposed a tariff on U.S. ethanol, and the U.S. faces stiff competition from Brazil.