energy.agwired.com

The corn shortage earlier this year, brought on by the unprecedented increase in interest in ethanol, seems to be easing a bit.

This story from Forbes says an expected giant corn crop this year should make up for all the corn going into ethanol production:

Ethanol producers have been squeezed by rising costs lately. Corn prices skyrocketed as demand from ethanol and food producers outstripped supply. But prices now look likely to abate because of ramped-up production. The Department of Agriculture reported last month that farmers planted 19% more corn than they did a year ago.

(Citi Investment Research analyst David) Driscoll said falling corn prices should boost margins at a time when the sector also enjoys strong political support. “Bipartisan political support for ethanol continues with all signs pointing to increased mandates for ethanol,” he said.

The news is so good Driscoll has been telling clients to buy some ethanol producers’ stocks… including VeraSun Energy and BioFuel Energy.
Shares of VeraSun Energy, which is headquartered in Brookings, S.D., gained 3.3%, or 46 cents, to $14.54. Shares of BioFuel, which is headquartered in Denver, Colo., gained 1.1%, or 10 cents to $9.19. Both are pure-play ethanol producers.

The Renewable Fuels Association has released a video to help first responders in case they have to fight an ethanol-fueled fire. The educational video, titled “Responding to Ethanol Incidents,” gives firefighters and ethanol plant operators important information on proper materials needed to fight potential ethanol incidents.

Much of the information in the video was gained during testing of different kinds of firefighting foams tested against ethanol fires at Ansul Fire Technology Center in Marinette, Wisconsin earlier this year.

“A dedication to safety has always been the foremost concern of the U.S. ethanol industry,” said RFA President Bob Dinneen. “With the industry growing at such a rapid rate, it is imperative that our nations’ first responders have the proper education and training to assist in an emergency at a moment’s notice. By making the video available to view on our website, we hope to communicate this message to first responders who have ethanol plants in their communities. On behalf of the RFA, I am confident that the availability of this DVD will help to combat any ethanol-related emergencies in the future.”

You can see the video at RFA’s web site, www.ethanolrfa.org.

The Consumer Federation of America, a consumer watchdog group, says big oil companies are trying to stop the growth of the ethanol industry… and Big Oil is using consumers’ pocketbooks in the fight.

In a report entitled “Big Oil’s Choke Hold: How Competition from Ethanol Can Help Lower Gasoline Prices for Consumers,” CFA charges that oil companies have used their market power to limit the supply of gasoline, keep consumer prices and profits high while opposing policies that would increase fuel supplies and lower prices. The report goes on to say that the increase in ethanol should have had the opposite effect. This comes from a CFA press release:

“This week when they announce their profits, the major oil companies will once again report huge windfalls at the expense of consumers who are paying record prices at the pump,” said Dr. Mark Cooper, CFA’s Director of Research. “The major oil companies have not only systematically failed to increase their refining capacity to meet growing gasoline demand, but now, threatened with
competition, are fighting hard against policies to expand production of ethanol and alternative fuels.”

The report goes on to say Big Oil has threatened to offset ethanol’s increasing production by cutting back its refining of gasoline and diesel fuel in an effort to restrict ethanol refining. Cooper also says oil company mergers have made it easier for the handful of companies to keep those gasoline supplies tight.

You can read all of CFA’s report by clicking here.

Add Sen. Hillary Rodham Clinton to the list of folks who suddenly seem to be a friend of ethanol. Just like in my June 5th post about Sen. John McCain, it comes down to two words for these presidential wannabes: Iowa caucus.

Democrat Clinton, just like Republican McCain, wanting to make sure she woos Iowa voters so she can grab her party’s nomination, has pulled a 180 and is now a big supporter of ethanol… at least when she’s in the Hawkeye State, according to this article in Newsday:

At one time, Clinton stood squarely with ethanol’s opponents, and voted several times against ethanol bills.

“We are providing a single industry with a guaranteed market for its products — subsidies on top of subsidies on top of subsidies and, on top of that, protection from liability,” she said during an April 2002 Senate energy bill debate. “What a sweetheart deal.”

Her tune has certainly changed now that she wants those corn farmers’ votes:

“Now, Iowa is way ahead of the rest of the country,” the presidential hopeful told listeners at a July 2 campaign stop. “What you’ve done with ethanol … you’re setting the pace.”

Political observers view her about-face as a political necessity, saying Iowa’s first-in-the-nation’s caucuses — in which residents of the country’s biggest corn-producing state vote their choice for presidential nominee — makes it politically risky to avoid kneeling at the altar of ethanol-from-corn.

I’m sure we’ll see a steady train of presidential candidates turned ethanol bandwaggoners for the next six months. Let’s just hope they’re still on board with ethanol when January 2008 is over.