Despite bankruptcies and attacks by environmentalists, the outlook for ethanol is improving, according to the chairman of USDA’s World Agricultural Outlook Board.
USDA’s February corn outlook says ethanol blender and producer margins have recently improved and weekly production of gasoline blends with ethanol is on the rise.
“We’ve seen relatively lower corn prices as of late and even producers now are going to go back in the black as opposed to being in the red before,” Outlook Board Chairman Gerald Bange said. “Whereas just a few weeks ago there was no real incentive to produce ethanol using either corn or sorghum, what we’re seeing now is somewhat positive returns for the production of ethanol. So things are looking a little bit better in the ethanol industry.”
Bange says the current blending credit is sufficient to provide a positive margin for blending as well.