Ethanol’s Boom Stalling as Glut Depresses Price

[L. Coyote]

The promoters and builders of the ethanol plants have made their profits.
Many of the plant investors are farmers. Were they sold a false promise?

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Ethanol’s Boom Stalling as Glut Depresses Price
http://www.nytimes.com/2007/09/30/business/30ethanol.html?ex=1348804800&en=488b42d7277f01c5&ei=5118&partner=rssaol&emc=rss

NEVADA, Iowa, Sept. 24 — The ethanol boom of recent years — which spurred a frenzy of distillery construction, record corn prices, rising food prices and hopes of a new future for rural America — may be fading.

Only last year, farmers here spoke of a biofuel gold rush, and they rejoiced as prices for ethanol and the corn used to produce it set records.

But companies and farm cooperatives have built so many distilleries so quickly that the ethanol market is suddenly plagued by a glut, in part because the means to distribute it have not kept pace. The average national ethanol price on the spot market has plunged 30 percent since May, with the decline escalating sharply in the last few weeks.

“The end of the ethanol boom is possibly in sight and may already be here,” said Neil E. Harl, an economics professor emeritus ..........

[Nickster]

1. Wow, supply doesn't drive demand? Who'd a thunk it?

[still_one]

2. Ethanol isn't that efficent, and the amount of energy to produce it, is more than it delivers

The other issues as you mentioned is that it will contribute to the already rising price of food

ADM and the sugar cane ethanol areas in South America will be the winners from this, while the rest of us will be left holding the bag

[Squatch]

3. Depends on the source.

Corn ethanol is, by far, the most energy inefficient source of ethanol. Sugar cane is currently the winner while new technologies show promise at unlocking future sources of ethanol.

[still_one]

4. Here in the U.S. it is primarily corn /nt