Saturday, December 6, 2008

Good News for the Ethanol Industry

It looks like the cost of corn and natural gas has declined faster than the sale price of ethanol. This is good news for the ethanol industry and those investors and companies (i.e. Greenshift) who support the ethanol industry. Thanks to Hapitomcat for finding this one:

"Ethanol plant profitability levels increased 8.2 cents per gallon of ethanol produced at the hypothetical ethanol plant. The weaker corn futures price, as well as falling natural gas price levels, continues to lower overall production costs of the plant. Even though ethanol prices in South Dakota eased on Friday, the reduced ethanol revenue did still allow for improved margins. Neeley Biofuels is currently posting a net profit of 18.4 cents per gallon. The net operating profit, which would resemble the profits of plants that have debt paid off, is currently listed at 50 cents per gallon of ethanol produced."

WOW! 50 cents/gallon! A 100 mmgy plant without a debt would produce $50M in profits on an annual basis.

Black line above is price of (RBOB) = reformulated gasoline blendstock for oxygen blending
Green Line is price of Ethanol
SkunK

No comments:

 
Free Blog CounterTamron