Staying Home
How Ethanol will Change
U.S. Corn Exports
Institute for Agriculture and Trade Policy
The Institute for Agriculture and Trade Policy
promotes resilient family farms, rural communities and ecosystems
around the world through research and education, science and
technology, and advocacy.
2105 First Avenue South
Minneapolis, Minnesota 55404 USA
Tel.: (612) 870-0453
Fax: (612) 870-4846
iatp@iatp.org
iatp.org
© 2006. All rights reserved.
About this publication
Staying Home: How Ethanol will Change U.S. Corn Exports
Written by Heather Schoonover, Program Associate, and
Mark Muller, Director, Environment and Agriculture Program
Published December 2006
Executive Summary
U.S. ethanol production is expanding at a phenomenal pace, doubling between 2001 and 2005 and
likely to double again in the next few years. While some corn needed to meet higher ethanol
demand could come from increased production, the U.S. Department of Agriculture (USDA) states
that much of the additional corn needed for ethanol production will be diverted from exports.
Despite this fact, there has been little focus on or discussion of the impact of corn-based ethanol on
U.S. corn exports. But these impacts could be significant, and ethanol’s potential impact on corn
exports should cause policymakers to reconsider their long-standing focus on exports.
The U.S. already has over 100 active ethanol plants capable of producing more than five billion
gallons of ethanol per year. An additional 58 plants currently under construction or expansion will
add nearly four billion more gallons of capacity, bringing total capacity to nearly nine billion
gallons—and surpassing the Renewable Fuels Standard requirement of 7.5 billion gallons by 2012,
far ahead of schedule. In addition, if all 150 currently proposed ethanol plants were to be built,
U.S. ethanol capacity would surpass 19 billion gallons per year.
While ethanol from cellulosic sources looks promising, corn will continue to be the primary source
of ethanol in the near future. Given the continued enormous expansion of ethanol capacity, this will
result in significant shifts in the corn market.
In a break from past projections, many of the major agricultural organizations are now projecting
flat corn export levels or even a decline in corn exports, citing ethanol as a key to this change. But
even these new projections are likely to underestimate the impact of ethanol on exports, because
they do not take into consideration the many ethanol plants currently on the drawing board.
Factoring in the impact of proposed ethanol plants yields some stunning results. For example, if
only a quarter of the plants currently proposed in the Midwest do come on line, and if the corn
needed to supply these plants and the plants currently under construction were to be diverted from
exports, Midwest corn exports could be cut in half. This shift would impact some states more than
others. For example, Nebraska could see negative corn exports (meaning corn needed for ethanol
plants would exceed corn for exports) if only a fraction of its proposed plants come online.
The growing demand for corn from the ethanol industry will result in several shifts in the Midwest
agricultural economy. First, higher prices will likely induce more farmers to grow corn. Second, the
livestock industry may reduce its Midwest corn demand, either by using alternative feed sources or
raising less Midwest livestock. Yet even with these shifts, it appears very likely that ethanol will
reduce the availability of corn for export.
The shift of agricultural land into energy production and bio-based products is not likely to reverse
course anytime in the near future. Whatever the crop—be it corn or switchgrass—domestic markets
are likely to provide more opportunities to farmers than the export of agricultural commodities.
Our agricultural, transportation and trade policies also need to shift to address this new reality and
truly invest in the future of U.S. agriculture.
Staying Home: How Ethanol will Change U.S. Corn Exports
1
2
Institute for Agriculture and Trade Policy
Introduction
U.S. ethanol production is expanding at a phenomenal pace. U.S. ethanol production doubled
1
between 2001 and 2005, and will likely double again within the next few years. The USDA’s Chief
2
Economist recently called ethanol “the most stunning development in agricultural markets today.”
The rapid growth in ethanol production has been embraced by grain farmers, who benefit from the
strong corn demand, and has raised concerns for the livestock industry, which relies on low-cost
corn for animal feed. Currently, about half of U.S. corn is used for animal feed, about 28 percent
3
for food and industrial uses, and 18 percent for export.
While some of the corn needed to meet the increased ethanol demand will come from yield and
acreage increases, much of it will likely come from exports. The USDA, in a recent article entitled
“Ethanol Reshapes the Corn Market,” stated, “The most recent USDA Baseline Projections suggest
4
that much of the additional corn needed for ethanol production will be diverted from exports.”
Despite the emphasis that U.S. agricultural and trade policy has placed on export markets, these
policies have largely failed, as U.S. farm exports have remained flat over the last few decades and the
U.S. share of the global trade of most agricultural commodities has been in decline. Nevertheless,
U.S. agricultural policy continues to be designed to push prices down in order to capture export
markets. Congress and the Army Corps of Engineers have repeatedly pushed to expand the
Mississippi River’s navigation system because of anticipated export traffic on the river. And U.S.
trade negotiators have aggressively pushed for greater market access for farm exports at the bilateral
and multilateral level. Ethanol’s potential diversion of corn from export markets should cause
policymakers to reconsider their long-standing focus on exports.
Staying Home: How Ethanol will Change U.S. Corn Exports
3
Ethanol capacity is expanding quickly
According to the Renewable Fuels Association, there are currently 107 active ethanol plants capable
5
of producing 5.1 billion gallons of ethanol per year. An additional 50 plants under construction
and eight plant expansions will add over 3.8 billion more gallons of capacity, bringing total capacity
6
to nearly 9 billion gallons —and surpassing the Renewable Fuels Standard requirement of 7.5
billion gallons by 2012, far ahead of schedule.
Historic U.S. Ethanol Production
5.5
5
4.5
Billion gallons
4
3.5
3
2.5
2
1.5
1
0.5
0
1980
1985
1990
1995
2000
2005
Source: Data from Renewable Fuels Association. 2006 figure is U.S. ethanol production capacity as of November 30, 2006.
Figure 1: U.S. ethanol capacity has expanded dramatically in recent years, doubling from 2001 to 2005 and likely to double
again by 2009.
While those numbers are impressive, they pale in comparison to the number of proposed ethanol
plants currently on the drawing board. Announcements about newly proposed plants are in the
news nearly every day. Iowa alone has over 20 ethanol plants in some stage of discussion—with a
7
total proposed capacity of over two billion gallons per year. To put this in perspective, the entire
8
U.S ethanol industry produced fewer than two billion gallons in 2001.
Although the number of proposed plants changes almost daily, as of November 30, 2006, data
compiled from the Renewable Fuels Association, Ethanol Producer Magazine, and various news
articles identified over 150 proposed plants in the U.S. with a total capacity of over 10 billion
9
gallons per year. Added to the nearly nine billion gallons that will be produced by existing plants
and those currently under construction or expansion, total U.S. ethanol capacity could surpass 19
billion gallons in the next couple of years.
4
Institute for Agriculture and Trade Policy
U.S. Ethanol Capacity
20
Proposed Projects
18
Under Construction / Expansion
Billion gallons per year
16
Current Capacity
14
12
10
8
6
4
2
0
Midwest
Rest of Country
Total
Source: IATP data, from Renewable Fuels Association, Ethanol Producer Magazine and various news sources.
Midwest includes IA, IL, IN, MN, MO, NE, ND, SD, WI
Figure 2: If all currently proposed ethanol plants were to be built, U.S. ethanol capacity would surpass 19 billion gallons per
year.
Billion Gallons per Year
Midwest Ethanol Capacity
4.5
Proposed Projects
4.0
Under Construction / Expansion
3.5
Current Capacity
3.0
2.5
2.0
1.5
1.0
0.5
in
ns
ta
co
is
W
Da
h
ut
So
No
rt
h
Da
br
as
ko
ko
ta
ka
i
Ne
is
M
ne
M
in
so
so
ur
ta
a
w
Io
an
di
In
Il l
in
oi
a
s
0.0
Source: IATP data, from Renewable Fuels Association, Ethanol Producer Magazine and various news sources.
Figure 3: Individual Midwest states could see enormous increases in ethanol capacity if currently proposed plants are built.
Iowa alone could surpass four billion gallons— the quantity the entire U.S. produced in 2005.
While it is unlikely that all of the proposed ethanol plants will be built, the sheer number on the
drawing board is evidence that ethanol capacity is only going to continue to increase. Perhaps more
importantly, ethanol capacity is expanding even faster than the number of plants being considered
might imply. Whereas ethanol plants built a few years ago had maximum capacities primarily in the
40-50 million gallons per year (mgy) range, many of the plants currently under construction and on
10
the drawing board plan to start with a capacity of at least 100 mgy. Archer Daniels Midland
11
(ADM) is currently constructing two plants with capacities of 275 mgy each.
Staying Home: How Ethanol will Change U.S. Corn Exports
5
What’s fueling ethanol growth?
As part of the Energy Policy Act of 2005, Congress passed a Renewable Fuels Standard (RFS) that
sets benchmarks for a minimum amount of U.S. fuel that must be provided by renewable sources.
The RFS starts with four billion gallons of renewable fuels in 2006, increasing to 7.5 billions
gallons by 2012.
However, as a recent news article from the U.S. Department
of Energy states, “growth in [the] ethanol industry makes
12
[the] national mandate moot.” The U.S. is on track to
13
produce over five billion gallons already this year.
A number of factors are behind this rapid expansion. While
the Renewable Fuels Standard certainly provided some
impetus, the rapid rise in fossil fuel prices, the phase-out of
gasoline additive MTBE and subsidies for ethanol production
have played a significant role as well. Concerns about energy
security and climate change and enthusiasm for renewable
energy production as a rural economic opportunity also
contribute to ethanol’s popularity. Whatever the reasons,
ethanol has indeed moved, as the title of the Renewable Fuels
14
Association’s 2006 Outlook says, “from niche to nation.”
Renewable Fuels Standard
Year
2006
2007
2008
2009
2010
2011
2012
Billion Gallons Ethanol
4
4.7
5.4
6.1
6.8
7.4
7.5
Figure 4: U.S. ethanol production will far
exceed the Renewable Fuels Standard.
U.S. ethanol capacity is already over five
billion gallons, and will reach nearly nine
billion gallons once the plants currently
under construction are completed.
Where will the corn come from?
U.S. ethanol production consumed less than five percent of the U.S. corn crop 10 years ago. In
contrast, ethanol production consumed about 14 percent of the U.S. corn crop in 2005. USDA
estimates that 2006 will see over 20 percent—and over 2 billion bushels—of U.S. corn going to
15
ethanol production. The amount of corn sold to ethanol plants is expected to surpass corn sent to
16
export for the first time this year.
While the research and development of cellulosic sources of ethanol looks promising, corn will
17
continue to be the primary source of ethanol in the foreseeable future. Given the continued
expansion of ethanol capacity, this will result in significant shifts in the corn market. USDA recently
declared, “To meet the sector’s growing demand for corn, some U.S. corn is likely to be diverted
18
from exports.”
Corn exports projected to decline
The two primary sources of agricultural export projections—USDA’s Agricultural Baseline and the
Food and Agriculture Policy Research Institute (FAPRI)’s Agricultural Baseline—have been
19
repeatedly criticized for what many experts agree to be overly optimistic export projections.
Indeed, despite the fact that corn exports have been flat for over two decades, USDA and FAPRI
have continued to project large increases in exports. Until now.
FAPRI revised its January 2006 projections in July 2006, stating, “Ethanol production growth is
projected to be much stronger than in FAPRI’s estimates from early 2006, due to higher prices and
20
the pace of plant construction.” Similarly, USDA’s 2006 corn export projections are significantly
lower—and its ethanol production projections significantly higher—than in previous years. The
National Corn Growers Association, in its report How Much Ethanol Can Come From Corn?,
21
affirmed, “export use...[is] not expected to increase significantly.”
6
Institute for Agriculture and Trade Policy
FA PR I Cor n Ex port Pr ojections
January 2006 vs. July 2006
2,200
M illion B ushels
2,100
2,000
1,900
1,800
January 2006 Corn Export Projection
1,700
July 2006 Corn Export Projection
1,600
1,500
200 4/20 05 20 05/2 006 2 00 6/200 7 20 07 /20 08 2 00 8/2 00 9 20 09/20 10
Source: Data from FAPRI 2006 U.S. and World Agricultural Outlook; FAPRI July 2006 Baseline Update for U.S.
Agricultural Markets.
Figure 5: FAPRI—one of the preeminent sources of agricultural projections—revised its U.S. corn export projections
downward mid-way through 2006, citing the strong growth of ethanol production as a reason for the change.
Cur rent FAP RI P rojections
Ethanol vs . Corn Ex por ts
4,000
3,500
Million Bushels
3,000
2,500
2,000
1,500
Corn Used for Ethanol
1,000
Corn Exports
500
0
2004/ 2005 2005/ 2006 2006/ 2007 2007/ 2008 2008/ 2009 2009/ 2010 2010/ 2011
Source: Data from FAPRI July 2006 Baseline Update for U.S. Agricultural Markets
Figure 6: FAPRI’s July 2006 Baseline Update projects declining corn exports—for the first time in FAPRI’s history of agricultural
projections. Corn used for ethanol is projected to surpass exports in the 2006/2007 marketing year.
Staying Home: How Ethanol will Change U.S. Corn Exports
7
USDA Ethanol P roduction Proj ections
2006 vs . P revious Y ear s
3,500
2004 Corn Used for Ethanol Projection
2005 Corn Used for Ethanol Projection
2006 Corn Used for Ethanol Projection
Million Bushels
3,000
2,500
2,000
1,500
1,000
14
/1 6
15
/1 5
20
4
/1
20
13
/1
20
12
20
11
/1
3
2
1
/1
10
20
20
0
/1
9
20
09
/0
8
08
20
07
/0
7
/0
20
06
20
05
20
04
/0
/0
6
5
4
/0
20
03
20
20
02
/0
3
500
Source: Data from USDA Agricultural Outlooks 2004, 2005, 2006.
Figure 7: USDA’s 2006 projection of corn used for ethanol is significantly higher that its projections from 2005 and 2004.
8
Institute for Agriculture and Trade Policy
Projections still underestimate ethanol production and impacts on exports
Ethanol production levels and the impact of ethanol on export levels are likely much greater than
the USDA and FAPRI projections imply, because the projections do not take into account the
proposed ethanol plants—i.e. those currently on the drawing board. Including only a fraction of
these proposed plants yields much greater ethanol production and much lower corn export
estimates than either USDA or FAPRI.
2008 P rojected U.S Ethanol Capacity
25
19.2
Billion Gallons per Year
20
16.6
14.0
15
11.4
10
8.7
7.3
5.2
5
0
F APRI
Projection
Capaci ty wi th Ca pacity with Capacit y wit h Ca pacity w ith
Current
Current
capa cit y + 25% proposed 50% proposed 75% propose d 100% proposed
national
pla nts
plants
plants
plants
etha nol plant capacit y under
construction or
capa city
ex pansion
Data Sources: FAPRI Projection from FAPRI July 2006 Baseline Update for U.S. Agricultural Markets. IATP ethanol capacity
data from Renewable Fuels Association, Ethanol Producer Magazine and various news sources.
Figure 8: Even with their revised numbers, FAPRI and USDA likely underestimate U.S. ethanol production. Ethanol capacity
will be significantly higher than either FAPRI or USDA project if even a fraction of the currently proposed ethanol plants come
on line.
Staying Home: How Ethanol will Change U.S. Corn Exports
9
Implications of ethanol for corn exports
The impacts of ethanol production on corn exports could be significant. For example, assuming all
of the plants currently under construction or expansion will be on line by 2008, if only a quarter of
the proposed plants in the Midwest are also built by then and if the corn needed to supply all of this
new capacity were to be diverted from exports, Midwest corn exports could be cut in half.
Potential I mpacts of Ethanol on 2008 M idwes t Cor n Exports
3000
Chart shows Midwest corn export levels if corn needed for new Midwest
plants were to be diverted from Midwest exports. New plants include those
currently under construction, in addition to the specified percentages of
proposed plants.
2500
M illion B ushels
2000
1500
2756
1000
1341
500
749
0
157
Exports if 100%
Proposed Plants Built
2005 Midwest State
Exports if 25%
Exports if 50%
Exports if 75%
Corn Exports
Proposed Plants Built Proposed Plants Built Proposed Plants Built
-435
-500
-1000
Source: IATP data. Assumes continued 0.78% increase in corn yield, 2.8 gal ethanol per bushel corn, constant corn acreage,
constant feed and other uses. Includes only proposed plants in the Midwest. 2005 state export volume calculated by
dividing export sales corn price at harvest, both from USDA ERS. Midwest includes IA, IL, IN, MN, MO, ND, NE, SD and WI.
Figure 9: If only a quarter of the currently proposed plants in the Midwest come on line by 2008, and if the corn needed to
supply these plants and the plants currently under construction were to be diverted from exports, Midwest corn exports
could be cut in half.
While it might be unlikely that 100 percent of all new ethanol capacity will be met by corn diverted
from exports, these numbers paint a good picture of the potential impacts. The sheer magnitude of
future ethanol capacity makes it highly likely that even with possible increases in yields, acreages,
and ethanol conversion efficiencies and other technological advances, some corn will have to be
diverted from export. Even if only a portion of future ethanol capacity is met by corn diverted from
exports, corn exports could drop dramatically.
Performing the same analysis for individual states produces even more stunning results. Most
Midwest states could see dramatic declines in state exports if only a fraction of their proposed
ethanol plants come on line. Nebraska could see negative corn exports (meaning corn needed for
ethanol plants would exceed corn for exports) if even half of its proposed plants come online. (Data
for other individual states are available in the appendix of this paper.)
10
Institute for Agriculture and Trade Policy
P otential Impacts of Ethanol on 20 08 Iow a Corn Ex ports
800
Chart shows Iowa corn export levels if corn needed for new Iowa plants were to
be diverted from state exports. New plants include those currently under
construction, in addition to the specified percentages of proposed plants.
M illion B ushels
600
400
669
200
280
122
0
2005 State Corn
Exports
Exports if 25%
Exports if 50%
Proposed Plants Built Proposed Plants Built
Exports if 75%
Proposed Plants
Built
Exports if 100%
Proposed Plants
Built
-35
-193
-200
-400
Source: IATP data. Assumes continued 0.78% increase in corn yield, 2.8 gal ethanol per bushel corn, constant corn acreage,
constant feed and other uses. Includes only Iowa ethanol plants. Historic state export volume calculated by dividing
export sales data by corn price at harvest for that year, both from USDA ERS.
Figure 10: Iowa could see a dramatic decrease in corn exports if even a quarter of its proposed ethanol plants come on line.
Potential Impacts of Ethanol on 2008 N ebras ka Cor n Ex ports
600
Chart shows Nebraska corn export levels if corn needed for new
Nebraska plants were to be diverted from state exports. New plants
include those currently under construction, in addition to the
specified percentages of proposed plants.
400
Million Bushels
200
427
49
0
2005 State Corn
Exports
Exports if 25%
Proposed Plants Built
-200
Exports if 50%
Proposed
Plants Built
Exports if 75%
Proposed Plants
Built
Exports if 100%
Proposed Plants
Built
-107
-264
-421
-400
-600
Source: IATP data. Assumes continued 0.78% increase in corn yield, 2.8 gal ethanol per bushel corn, constant corn acreage,
constant feed and other uses. Includes only Nebraska ethanol plants. Historic state export volume calculated by dividing
export sales data by corn price at harvest for that year, both from USDA ERS.
Figure 11: Nebraska could see negative corn exports (meaning corn needed for ethanol plants would exceed corn for
exports) if even half of its proposed ethanol plants come on line. (Data for all Midwest states are available in the appendix of
this paper.)
Staying Home: How Ethanol will Change U.S. Corn Exports
11
Implications for government policy
The USDA recently stated that “how the market adapts to this increased demand [for ethanol] is
st
22
likely to be one of the major developments of the early 21 century in U.S agriculture.” USDA’s
Chief Economist recently declared, “We are embarking on a profound change in our agricultural
23
economy.”
Expanded ethanol production will have a variety of impacts on the Midwest agricultural economy.
Most importantly, corn will most likely be more expensive. An agricultural export industry, as well
as several domestic corn uses, has been built on the presumption that corn will remain cheap. That
premise no longer appears valid.
Domestically, high corn prices might have the most profound impact on the livestock industry,
which uses about half of the U.S. corn crop. Major poultry and livestock companies like Tyson
24
Foods have already complained about tightening corn markets. The shift in prices and supplies
may cause the livestock industry to look for alternative feed crops, or even limit Midwest livestock
production. The increased use of distillers grains as a high-protein livestock feed, however, could
induce more livestock production near ethanol plants, so the overall impact on the livestock
industry is still unclear.
What seems clearer is that international processors and livestock companies will be further
challenged to compete for U.S. corn against growing domestic uses. Even with substantial growth
in Midwest corn acreage and a cooling of the ethanol market, it is hard to imagine as much corn
available for export in the coming decades as there has been in past years.
Federal tax credits for ethanol are largely responsible for allowing the ethanol industry to grow and
compete against the enormous and heavily subsidized fossil fuel industry. Despite this, much of
federal agriculture, trade, and transportation policy is instead directed toward expanding low-cost
exports rather than the growing domestic markets. Since the early 1970s, exports have been
considered the future markets for Midwest grain and oilseed farmers, and commodity policy, export
credits, and trade agreements have all been used to encourage low-cost crops for international
25
markets. However, bulk commodity Midwest exports have been flat or in decline since 1980. The
growth of the domestic ethanol market makes it likely that these trends will continue.
Future opportunities for farmers lie not in bulk commodity exports, but in a more diverse and
localized system of agriculture. The shift of agricultural land into energy production and bio-based
products is not likely to reverse course anytime in the near future. Whatever the crop—be it corn or
switchgrass—domestic markets are likely to provide more opportunities to farmers than the export
of agricultural commodities. Our agricultural, transportation and trade policies also need to shift to
address this new reality.
In general, the explosive growth in domestic corn consumption and the resulting higher prices have
been an economic boon for rural Midwest communities, particularly when the ethanol plants are
owned locally. And they have the potential to remain so. But with larger players getting into the
ethanol industry, efforts must be made to ensure that benefits remain with farmers and rural
communities. Similarly, with continued increases in both the number and the size of ethanol plants,
efforts must be made to ensure that conservation plays a key role in energy crop production and
ethanol plant operation. Proposals to pull land out of the Conservation Reserve Program, or to
plant consecutive seasons of corn, or fuel ethanol plants with coal, raise serious environmental
concerns, as does the amount of water future ethanol plants might consume. The recent increase in
12
Institute for Agriculture and Trade Policy
ownership of ethanol plants outside of the local area raises concerns about benefits being diverted
from farmers and rural communities.
Three important pieces of federal legislation that will impact agricultural markets are due for
discussion in the next year. The Farm Bill, which determines commodity and agricultural
conservation policy and will include renewable energy legislation, will be renewed in 2007. Second,
the Water Resources Development Act, which almost received Congressional approval this past
year, will be discussed, and will likely again include a proposal for authorization to extend the
length of several locks on the Mississippi and Illinois Rivers to facilitate more grain and oilseed
export, at a cost to U.S. taxpayers of several billion dollars. And third, legislation that authorizes the
President to negotiate trade agreements with foreign countries without consulting Congress, called
Trade Promotion Authority, is set to expire in July 2007.
Using taxpayer money in a futile attempt to kick start export-oriented agriculture was a
questionable tactic five years ago in the last Farm Bill. Now, given the change in agricultural
markets, spending money on items like longer locks is downright foolish. Farmers and rural
communities will benefit much more from incentives for local ownership of ethanol plants,
investments in regional transportation networks, fair market prices for their products, and valueadded opportunities. Congress should reconsider the pieces of legislation and direct federal
investment toward initiatives that will provide substantially more benefits to rural Midwest
communities.
Staying Home: How Ethanol will Change U.S. Corn Exports
13
References
24
1
Renewable Fuels Association. http://www.ethanolrfa.org/
2
“Ethanol Dazzles Wall Street, White House.” Associated
Press. June 5, 2006. Available at
http://www.cbot.com/cbot/pub/cont_detail/0,3206,1037+
38889,00.html
3
USDA ERS. Feed Outlook. July 14, 2005.
http://usda.mannlib.cornell.edu/reports/erssor/field/fdsbb/2005/fds05f.pdf
4
USDA ERS. “Ethanol Reshapes the Corn Market.” Amber
Waves. April 2006.
http://www.ers.usda.gov/AmberWaves/April06/Features/Et
hanol.htm
5
Renewable Fuels Association (RFA) data, as of November 30,
2006. http://www.ethanolrfa.org/
6
Ibid.
7
Institute for Agriculture and Trade Policy (IATP) data.
Unpublished.
8
RFA data, op cit.
9
IATP data, op cit.
10
IATP data, op cit.
11
“ADM Selects Cedar Rapids, Iowa as Second Location for
Ethanol Expansion.” ADM Press Release. May 10, 2006.
http://www.admworld.com/euit/pressroom/newspopup.asp?
id=392&name=Site_Selected_for_Ethanol_Expansion
12
US Dept. of Energy. Energy Efficiency and Renewable
Energy Network News. August 30, 2006.
http://www.eere.energy.gov/news/news_detail.cfm/news_id
=10228
13
RFA data, op cit.
14
Renewable Fuels Association. From Niche To Nation: Ethanol
Industry Outlook 2006. February 2006.
http://www.ethanolrfa.org/media/outlook
15
USDA. “U.S. Agriculture and the Emerging Bioeconomy.”
Presentation by USDA Chief Economist Keith Collins, at
Advancing Renewable Energy: An American Rural
Renaissance, St. Louis, Missouri, October 12, 2006. Available
at http://www.usda.gov/oce/index.htm
16
“Ethanol Dazzles Wall Street, White House.” op cit.
17
See, for example, U.S. Department of Energy. Breaking the
Biological Barriers to Cellulosic Ethanol: A Joint Research
Agenda. June 2006.
18
USDA ERS, op cit.
19
See, for example, Baumel, C. Phillip. How U.S. Grain Export
Projections from Large Scale Agricultural Sector Models
Compare with Reality. May 2001.
20
FAPRI. FAPRI July 2006 Baseline Update for U.S.
Agricultural Markets. July 2006.
21
National Corn Growers Association. How Much Ethanol Can
Come from Corn? November 2006. Available at
http://www.ncga.com/ethanol/main/index.asp.
22
23
USDA ERS, op cit.
Swann, Christopher. “U.S. Thirst for Ethanol Trims Corn
for Export.” Financial Times, May 26, 2006
Cameron, Doug. “Tyson warning on food versus fuel
debate.” Financial Times, November 13, 2006. Available at
http://msnbc.msn.com/id/15700406/
25
Institute for Agriculture and Trade Policy. Where are future
markets for Midwest agriculture? January 2006. Available at
http://www.environmentalobservatory.org/library.cfm?refid=
80441
800
600
400
200
0
-200
-400
669
2005 State Corn Exports
Exports if 50% Proposed Plants
Built
122
-35
Exports if 75%
Proposed Plants
Built
-193
Exports if 100%
Proposed Plants
Built
Chart shows Iowa corn export levels if corn needed for new Iowa plants were
to be diverted from state exports. New plants include those currently under
construction, in addition to the specified percentages of proposed plants.
Potential Impacts of Ethanol on 2008 Iowa Corn Exports
280
Exports if 25% Proposed Plants
Built
Source: IATP data. Assumes continued 0.78% increase in corn yield, 2.8 gal ethanol per bushel corn, constant corn acreage, constant feed and other
uses. Includes only Iowa ethanol plants. Historic state export volume calculated by dividing export sales data by corn price at harvest for that year, both
from USDA ERS.
Million Bushels
600
500
400
300
200
100
0
536
2005 State Corn Exports
Potential Impacts of Ethanol on 2008 Illinois Corn Exports
276
Exports if 50% Proposed Plants
Built
82
Exports if 75% Proposed Plants Exports if 100% Proposed Plants
Built
Built
179
Chart shows Illinois corn export levels if corn needed for new Illinois
plants were to be diverted from state exports. New plants include those
currently under construction, in addition to the specified percentages of
proposed plants.
373
Exports if 25% Proposed Plants
Built
Source: IATP data. Assumes continued 0.78% increase in corn yield, 2.8 gal ethanol per bushel corn, constant corn acreage, constant feed and other
uses. Includes only Illinois ethanol plants. Historic state export volume calculated by dividing export sales data by corn price at harvest for that year,
both from USDA ERS.
Million Bushels
400
300
200
100
0
-100
-200
286
2005 State Corn Exports
Potential Impacts of Ethanol on 2008 Indiana Corn Exports
Exports if 50% Proposed Plants
Built
1
-82
Exports if 75%
Proposed Plants
Built
Exports if 100%
Proposed Plants
Built
Chart shows Indiana corn export levels if corn needed for new Indiana plants were to be diverted
from state exports. New plants include those currently under construction, in addition to the
specified percentages of proposed plants.
84
Exports if 25% Proposed Plants
Built
-165
Source: IATP data. Assumes continued 0.78% increase in corn yield, 2.8 gal ethanol per bushel corn, constant corn acreage, constant feed and other
uses. Includes only Indiana ethanol plants. Historic state export volume calculated by dividing export sales data by corn price at harvest for that year,
both from USDA ERS.
Million Bushels
400
300
200
100
0
370
2005 State Corn Exports
Potential Impacts of Ethanol on 2008 Minnesota Corn Exports
277
Exports if 50% Proposed Plants
Built
207
Exports if 75% Proposed Plants Exports if 100% Proposed Plants
Built
Built
242
Chart shows Minnesota corn export levels if corn needed for new Minnesota plants were to
be diverted from state exports. New plants include those currently under construction, in
addition to the specified percentages of proposed plants.
312
Exports if 25% Proposed Plants
Built
Source: IATP data. Assumes continued 0.78% increase in corn yield, 2.8 gal ethanol per bushel corn, constant corn acreage, constant feed and other
uses. Includes only Minnesota ethanol plants. Historic state export volume calculated by dividing export sales data by corn price at harvest for that year,
both from USDA ERS.
Million Bushels
150
100
50
0
109
2005 State Corn Exports
Potential Impacts of Ethanol on 2008 Missouri Corn Exports
94
Exports if 50% Proposed Plants
Built
82
Exports if 75% Proposed Plants
Built
71
Exports if 100% Proposed Plants
Built
Chart shows Missouri corn export levels if corn needed for new Missouri plants were to be diverted
from state exports. New plants include those currently under construction, in addition to the specified
percentages of proposed plants.
106
Exports if 25% Proposed Plants
Built
Source: IATP data. Assumes continued 0.78% increase in corn yield, 2.8 gal ethanol per bushel corn, constant corn acreage, constant feed and other
uses. Includes only Missouri ethanol plants. Historic state export volume calculated by dividing export sales data by corn price at harvest for that year,
both from USDA ERS.
Million Bushels
600
400
200
0
-200
-400
-600
427
Potential Impacts of Ethanol on 2008 Nebraska Corn Exports
Exports if 25% Proposed Plants
Built
49
-107
Exports if 50% Proposed
Plants Built
Exports if 75%
Proposed Plants
Built
Exports if 100%
Proposed Plants
Built
Chart shows Nebraska corn export levels if corn needed for new Nebraska plants were to be diverted from state
exports. New plants include those currently under construction, in addition to the specified percentages of
proposed plants.
2005 State Corn Exports
-264
-421
Source: IATP data. Assumes continued 0.78% increase in corn yield, 2.8 gal ethanol per bushel corn, constant corn acreage, constant feed and other
uses. Includes only Nebraska ethanol plants. Historic state export volume calculated by dividing export sales data by corn price at harvest for that year,
both from USDA ERS.
Million Bushels
80
60
40
20
0
-20
-40
-60
-80
72
2005 State Corn Exports
Potential Impacts of Ethanol on 2008 North Dakota Corn Exports
-9
Exports if 50% Proposed
Plants Built
Exports if 75%
Proposed Plants
Built
Exports if 100%
Proposed Plants
Built
Chart shows North Dakota corn export levels if corn needed for new North Dakota plants were to be diverted
from state exports. New plants include those currently under construction, in addition to the specified
percentages of proposed plants.
16
Exports if 25% Proposed Plants
Built
-33
-58
Source: IATP data. Assumes continued 0.78% increase in corn yield, 2.8 gal ethanol per bushel corn, constant corn acreage, constant feed and other
uses. Includes only North Dakota ethanol plants. Historic state export volume calculated by dividing export sales data by corn price at harvest for that
year, both from USDA ERS.
Million Bushels
200
150
100
50
0
-50
152
Exports if 25% Proposed Plants
Built
14
Exports if 50% Proposed Plants
Built
9
Exports if 75% Proposed Plants
Built
3
-2
Exports if 100%
Proposed Plants
Built
Chart shows South Dakota corn export levels if corn needed for new South Dakota plants were to be diverted
from state exports. New plants include those currently under construction, in addition to the specified percentages
of proposed plants.
Potential Impacts of Ethanol on 2008 South Dakota Corn Exports
2005 State Corn Exports
Source: IATP data. Assumes continued 0.78% increase in corn yield, 2.8 gal ethanol per bushel corn, constant corn acreage, constant feed and other
uses. Includes only South Dakota ethanol plants. Historic state export volume calculated by dividing export sales data by corn price at harvest for that
year, both from USDA ERS.
Million Bushels
150
100
50
0
134
2005 State Corn Exports
Potential Impacts of Ethanol on 2008 Wisconsin Corn Exports
87
Exports if 50% Proposed Plants
Built
65
Exports if 75% Proposed Plants Exports if 100% Proposed Plants
Built
Built
44
Chart shows Wisconsin corn export levels if corn needed for new Wisconsin plants were to be diverted from
state exports. New plants include those currently under construction, in addition to the specified percentages
of proposed plants.
108
Exports if 25% Proposed Plants
Built
Source: IATP data. Assumes continued 0.78% increase in corn yield, 2.8 gal ethanol per bushel corn, constant corn acreage, constant feed and other
uses. Includes only Wisconsin ethanol plants. Historic state export volume calculated by dividing export sales data by corn price at harvest for that year,
both from USDA ERS.
Million Bushels
Institute for Agriculture and Trade Policy
2105 First Avenue South Minneapolis, Minnesota 55404 USA
iatp.org