Profitability Returning to Ethanol Industry

Domestic Fuel.com
Posted by Cindy Zimmerman – October 11th, 2009

The sun appears to be rising again for the ethanol industry.

“Profitability has returned,” says Joe Victor, who is Vice President of commodity research advisory firm Allendale, Inc. “We know that over the past three months that there is profit returning, above and beyond all costs. Ethanol companies are turning a profit over the past three months.”

The main reason is lower corn prices compared to last year and prospects for a bumper corn crop this year. The Wall Street Journal is calling it “Christmas in October for Ethanol Producers.” Last week, ethanol processing margins nearly doubled to a dollar a bushel. Since early July, ethanol futures on the Chicago Board of Trade have increased more than 20%, while corn futures have only gone up about five percent.

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