Dramatic Drop Seen in Corn Used for Ethanol

Ohio Farm Bureau Federation
Published on 12/23/2008

WASHINGTON – The Agriculture Department’s World Agricultural Supply and Demand Estimates (WASDE) released today places corn used for ethanol production at 3.7 billion bushels, down 300 million bushels from the November estimate. “The most dramatic change in the December WASDE report was the big drop in corn used for ethanol production,” said Terry Francl, senior crops economist with the American Farm Bureau Federation (AFBF). “I am surprised that corn use for ethanol dropped by that much. Demand for ethanol is down, just like demand for gasoline is down, but I just don’t think the decline is that large. I believe 3.8 billion bushels to 3.9 billion bushels is closer to the mark.”

Francl explained that a number of ethanol plants are idled due to weak demand, which explains the drop in corn used for ethanol. However, the Renewable Fuel Standards would seem to imply that at least 3.8 billion bushels of corn will be utilized for ethanol production in 2008/09.

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