What Effects Will The Rain Have on Ethanol?
As this piece is being written, reports are out that a mere 58% of the country’s total corn acres have been planted. At this same time last year, the total stood at 90%—a decrease of nearly 1/3 total acres nationwide. This news has left many farmers shaking their heads, questioning whether or not they will attempt to plant any corn acres at all this year. Yes, these are troubling times to be in the farming business; and, unfortunately, farmers are not the only ones struggling during these difficult times. Enter those in the ethanol industry.
Ethanol, as we all know, is derived from corn, meaning corn is the main ingredient in the composition of ethanol fuel. So, if there is no corn, there is no ethanol; simple as that. And when the statistic for total planted corn acreage is down 32%, this does not bode well for the production of ethanol in 2019. Again, troubling times indeed.
Surplus ethanol supplies currently exist throughout the United States, leading to per- gallon fuel prices remaining relatively constant. However, simple supply-and-demand economics verify that when supply goes down, demand goes up; and with demand increasing, so, too, price. And if this were to happen, this is a fact that would be hitting all American motorists directly in their respective pocketbooks. Yet another detriment causing insult to injury.
So, just what’s to be done? At this point, truly not a whole heck of a lot. The occasional days of repeated sunshine mixed with intermittent rain showers leave farmers caught in a literal Catch 22. That said, the remaining days for corn planting are quickly slipping by. Ethanol producers remain hopeful and optimistic that the weather will cooperate. But simply rolling the dice on Mother Nature can be a very costly risk on which to bet the family farm. Of course, those of us here at Clean Fuels National—and we’re sure each and every other American motorist as well—say go ahead and plant. Time will certainly tell, however.