Corn and Ethanol.

[James48843]

I would just make a quick note-

While the gasoline market hasn't been much affected by the recent comments about trade wars, the price of CORN has been significantly impacted.

Here is a chart of what has happened to CORN prices over the last few weeks- they've tumbled.



Ouch.

Good news for flex-fuel drivers.

Bad news for farmers counting on Corn income.

SPOT PRICES THIS MORNING:

RBOB GASOLINE is trading at $2.04 a gallon on the Chicago exchange.

ETHANOL is currently trading at $1.41 a gallon, AND the RIN price (Renewable credit) is now at $0.18 cents a gallon, meaning a producer can sell his Ethanol product at roughly $1.23 a gallon.

The value of RIN's has collapsed in half over the last few months as the EPA is now chaing ethanol policy and granting lots of waivers to oil companies.

That, combined with the possiblity that China will target CORN and Ethanol DDG byproducts for trade tariffs, is hitting farmers especially hard right now.

 

[burrocrat]

Can I (and the american consumer) get some relief from this mandate, please??!!!!???

no. we think it helps the planet. now fork it over.

and don't worry, businesses and consumers correct themselves much faster than politicians.

 

[Minnow]

Now with oil prices hitting new lows again...I venture to say it will be cheaper by the gallon for gasoline to be 100% pure, than blend it with expensive moonshine...

Spot on from a month ago.... even I don't believe that spot price tells the exact story... but, using the argument that has been made on this very thread, ethanol spot for January is approximately 10 cents more expensive than rbob gasoline. Can I (and the american consumer) get some relief from this mandate, please??!!!!???

 

[Buster]

This is the way we should spend for ETHANOL


Investors around the world are betting big on whiskey, which can skyrocket in value and toss back whopping returns.

 

[nnuut]

[h=1]Good News For Corn, Bad News For You[/h] [h=2]The corn ethanol lobby gets a big break in Obama's 2015 budget proposal.[/h]

The Obama administration is reintroducing expensive subsidies for corn ethanol blender pumps in its 2015 budget.
By Ryan Alexander March 12, 2014 | 8:00 a.m. EDT + More

This is a good news/bad news story.
The good news was found in an unexpected place. We at Taxpayers for Common Sense did not have a lot of good things to say about the recently enacted 2014 Farm Bill, but there were a few glimmers of hope hidden among the billions of dollars of wasteful subsidies. For one, taxpayers would no longer be forced to subsidize ethanol blender pumps through the U.S. Department of Agriculture’s Rural Energy for America Program. Corn ethanol, a fuel that is blended with most gasoline at a level of 10 percent (known as E10), was the main beneficiary of these subsidies since it is the most widely produced biofuel in this country.
[See a collection of political cartoons on the economy.]
The corn ethanol industry has a long history of receiving federal taxpayer subsidies. One of the biggest subsidies – the $6 billion-per-year Volumetric Ethanol Excise Tax Credit – was finally allowed to expire in 2011 after a Senate amendment to eliminate it offered by Sens. Dianne Feinstein, D-Calif., and Tom Coburn, R-Okla., passed by a 73-27 margin. (The underlying bill ultimately failed to pass, but the amendment signaled that the days of the ethanol industry’s rule on Capitol Hill were over). So, the corn ethanol lobby pivoted to maximize taxpayer subsidies and turned to USDA to secure ethanol blender pump subsidies through the rural energy program which was originally designed to promote rural solar, wind, hydropower and geothermal projects. Congress even specifically barred corn ethanol from receiving taxpayer subsidies through it and other energy title programs in the 2008 Farm Bill. But in 2011 USDA began to allow blender pump subsidies to qualify for these payments since efforts to secure more subsidies through Congress were unsuccessful.
So it was great news that the (otherwise terrible) 2014 farm bill (officially the Agricultural Act of 2014) prevents the mature corn ethanol industry from receiving subsidies to purchase pumps dispensing higher blends of corn ethanol.
Now for the bad news. Less than a month after signing the farm bill into law, the president proposed new subsidies for ethanol blender pumps in his FY 2015 budget proposal. The overall budget was released last Tuesday, with detailed back up documents following in the last few days. Buried on page 158 of the “Analytical Perspectives” document, released Monday, is up to $200 million in new advanced energy manufacturing tax credits for the “construction of infrastructure that contributes to networks of refueling stations that serve alternative fuels,” or in other words, more subsidies for corn ethanol blender pumps and other alternative fuel infrastructure projects. Such is the power of the corn ethanol lobby. [more]
Obama's 2015 Budget Backs Costly Corn Ethanol Subsidies - US News

 

[Minnow]

I was wrrroo.
I was Wrrrrrooooonn...(ack).

Oh hell, I was almost right.

Attaboy Jim

 

[alevin]

:laugh: Way to go, James!

 

[James48843]

:laugh:You must have me mistaken for someone else. I know that you know that I know that you know that I know how subsidies reflect in price and total COST. Even with the ethanol mandate, rbob just broke below ethanol when Mr. "Just report the facts" stated in bold and underlined that that would "Never" happen without a major drought or massive disruption. Less than one year later, what happened?

Jim's still my favorite Michigan resident and all, he just needs to suck it up like the Fonz did on Happy Days and say he was wrrrr rrrr rrrrr wrrrong.

I was wrrroo.
I was Wrrrrrooooonn...(ack).

Oh hell, I was almost right.

 

[James48843]

I don't think you guys are taking into account Ethanol Subsidies? We pay for that too!

]

There are no ethanol subsidies anymore, Nnuut. That ended over two years ago. This is all "free-market" pricing now.

 

[nnuut]

There's something wrong with those Progressives, when they make up their mind you can't change it no matter how WRONG they are. What's up with that?

 

[Minnow]

I don't think you guys are taking into account Ethanol Subsidies? We pay for that too!

:laugh:You must have me mistaken for someone else. I know that you know that I know that you know that I know how subsidies reflect in price and total COST. Even with the ethanol mandate, rbob just broke below ethanol when Mr. "Just report the facts" stated in bold and underlined that that would "Never" happen without a major drought or massive disruption. Less than one year later, what happened?

Jim's still my favorite Michigan resident and all, he just needs to suck it up like the Fonz did on Happy Days and say he was wrrrr rrrr rrrrr wrrrong.

 

[nnuut]

I don't think you guys are taking into account Ethanol Subsidies? We pay for that too!

 

[Minnow]

Your figures are correct. However, Rob broke below ethanol for about 1 hour. You said never and underlined it. Remember? The words you were looking for are: "I was wrong, Minnow. You were right.". Come on fonzie you can do it.

 

[James48843]

Hey Jim, what's the spot price on the December contract for RBOB? and for ethanol? When was that "major drought" or massive disruption?

I've heard crow tastes a little better with Tabasco. Eat up buddy.

Spot price today for December RBOB gasoline is $2.0503:
http://www.cmegroup.com/trading/energy/refined-products/rbob-gasoline.html

Spot price today for December ethanol is $2.02
http://www.cmegroup.com/trading/energy/ethanol/cbot-ethanol.html

Ethanol is cheaper.

Then look at, oh, say JUNE 2015.

Ethanol is at $1.71.
http://www.cmegroup.com/trading/energy/ethanol/cbot-ethanol.html


RBOB is at $2.24.

any way you cut it, energy prices are better now for the consumer than they've been in years.

P.S.= I paid $1.85 a gallon at the pump yesterday for renewable E-85 fuel.
What did you pay?

E85 Prices » Michigan » East Lansing

 

[Buster]

Now with oil prices hitting new lows again...I venture to say it will be cheaper by the gallon for gasoline to be 100% pure, than blend it with expensive moonshine...

 

[Minnow]

Ethanol is cheaper than gasoline. Period. And should continue to be, from here on out. We've past the tipping point. It will Never be more expensive than gasoline, unless there is some massive disruption , like a major drought. Even if that happens, it will only be temporary.

Hey Jim, what's the spot price on the December contract for RBOB? and for ethanol? When was that "major drought" or massive disruption?

I've heard crow tastes a little better with Tabasco. Eat up buddy.

 

[James48843]

First rail car of Sugarbeet Ethanol shipped


Aventine Renewable Energy Inc., a producer, marketer and end-to-end supplier of ethanol, announced last week that its first railcar shipment of ethanol produced at its Aurora West facility in Aurora, Neb., using sugar beet sugar as feedstock occurred.

“We are excited to have Aurora West up and running, creating local jobs, and contributing to the Nebraska economy,” said Mark Beemer, Aventine’s president and CEO. “This marks an important milestone in Aventine’s continuing story of innovation and demonstrates our leadership in the ethanol industry. By producing sustainable green energy, we’re also helping to ensure America’s domestic energy security.”

The company has hired 52 employees to date, and expects to hire 18 more in the next two months, for an annualized payroll of $4.6 million. It was noted that the company has already injected $10.6 million into the local Aurora economy through expenditures on operational needs.
Aventine Renewable Energy, with headquarters at Pekin, Ill., is a producer and marketer of industrial and fuel ethanol and related byproducts, bio-products and co-products related to ethanol production.

http://www.agprofess.../261300731.html

 

[Minnow]

That price spike had nothing to do with the renewable fuel standard. Pardon my French, but any inference that RFS caused the price spike is pure bull. Ethanol is cheaper than gasoline. Period. And should continue to be, from here on out. We've past the tipping point. It will Never be more expensive than gasoline, unless there is some massive disruption , like a major drought. Even if that happens, it will only be temporary.

I said there was an unnatural bubble in the price of ethanol- and no reason for it, on March 31- a day when it hit $2.85 a gallon.

And lookie there- it dropped like a rock shortly after.

Yep- no reason at all that ethanol was above $2.25.

Note- it should stay much less than gasoline through the summer.

Took you almost a month to reply to the post. Waited that long for the price to sort of even out to try and say,"I told you so!"? Typical.

This had everything to do with the mandate. Around 85% of the U.S. population lives within 100 miles of an ocean or gulf. How many terminals or pipelines has Archer Daniels Midland built or paid for? Zero. The ethanol industry got that taken care of with the RFS mandate requiring the oil companies to blend the ethanol in with gasoline. Roughly 80 years of spending on infrastructure gone into the oil industry and the ethanol producers get it for free. Pretty sweet deal, huh? Ethanol might "work" in the midwest (rail costs less the less distance you ship -- duh!!!!) but not out to the coasts where the majority of americans live.

About your little chart up there. When there's a shortage you don't price things a month out, you have to live in the now. The refiners and distributors couldn't get the ethanol to blend in so they had to pay spot price, which you ignore -- either intentionally or through ignorance. Ethanol spot prices in some places were over $4/gallon and here on the Gulf Coast it got to $3.64 (alot more than gasoline spot) but, as they said in Goodfells, "F&*ck you! Pay me!" we got the mandate -- gas cannot be sold most places unless it's 10% ethanol. Perfectly good gasoline sitting in storage can't be used because of no ethanol to blend. The very definition of false demand. Think this won't happen again? HA!!! The oil industry has to pay for the new transportation costs of ethanol to the population and guess who that cost gets passed down to?

Oh, ethanol will NEVER be more expensive than gasoline? That's not me on the other side of that bet -- it's the Old Testament Lord with plagues, locusts, floods and droughts. So, don't couch your statements with "unless there's some massive disruption" because that's the very nature of commodities (duh, supply and demand) and why you and ethanol backers don't understand the true costs of the energy industry.

Ethanol is getting a free ride because of the mandate and therefore is not fully priced because that tab is being picked up by the refiners and producers of oil.

You can make price say anything you want it to -- you won't fool me because I know what it costs.

 

[nnuut]

Check the Gas Mileage and the subsidies and recalculate that price please.
Refineries are down for maintenance, that drove up the price along with Obama and Putin.

Daily Fuel Gauge Report--national, state and local average prices for gasoline, diesel and E-85.

 

[James48843]

10% mandated blending of ethanol causing the price at the pump to increase??? Nah, that'll never happen. :laugh: Ethanol more expensive than gasoline, nah that'll never happen.

That price spike had nothing to do with the renewable fuel standard. Pardon my French, but any inference that RFS caused the price spike is pure bull. Ethanol is cheaper than gasoline. Period. And should continue to be, from here on out. We've past the tipping point. It will Never be more expensive than gasoline, unless there is some massive disruption , like a major drought. Even if that happens, it will only be temporary.

I said there was an unnatural bubble in the price of ethanol- and no reason for it, on March 31- a day when it hit $2.85 a gallon.

And lookie there- it dropped like a rock shortly after.



Yep- no reason at all that ethanol was above $2.25.

Note- it should stay much less than gasoline through the summer.