Del.icio.us  Digg  facebook  MySpace  Twitter  Google  Bookmark Me  LinkedIn  StumbleUpon  Permalink

Ethanol and Corn Prices Affected by Blend Wall

Iowa State University Energy Economist Robert Wisner predicts that within three years, demand for corn for ethanol may well exceed the traditional largest source of demand for corn — livestock feeding. Presently, ethanol consumes about one-third of the U.S. corn crop. Wisner says with the current large size of the ethanol industry, corn prices have become closely related to crude petroleum and gasoline prices because corn is now a major energy crop.

Writing in the AgMRC Renewable Energy Newsletter, Wisner says this ethanol success story has transformed Midwest agriculture from a sector that experienced excess production capacity, low prices, and government income supports to a growth sector with frequent periods of tight supplies even with good crop yields.