Ethanol boosts corn food, seed, and industrial use

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Food, seed, and industrial use (FSI) for 2012/13 is raised 50 million bushels with an increase in the projection for corn used for ethanol. The increase to 4,550 million bushels was based on year-to-date ethanol production and the prospect of lower corn prices contributing to already favorable margins for ethanol producers, spurring additional production. In spite of the projected increase, the implications of lower gasoline consumption and implicit restrictions in the volume of ethanol that can be blended into gasoline continue to constrain growth in ethanol production. On April 8, the Energy Information Agency (EIA) predicted gasoline production for the 2012/13 crop-year period at 133.0 billion gallons, compared with 133.2 billion for the 2011/12 crop year. EIA also forecast the lowest summer gasoline use in 12 years. However, weekly ethanol production during March advanced relative to previous months, indicating improved margins may be impacting production, and therefore, corn used for fuel.

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Texas  |  April, 13, 2013 at 08:58 PM

With the recent dollar plus fall in old crop corn prices, induced by fairytale USDA stocks numbers, users should have been able to lock in prices for their summer usage at lucrative price levels. Cargill and ADM have had ample time to pay off their debt, from investments in the ethanol fiasco, so it shouldl be difficult for congress to justify the continuance of the ethanol mandate, and the blenders tax credit. Time to see if this puppy can fly without the help of the American taxpayer. Let the consumer choose whether they want gas with ethanol, or not. Cargill and ADM are nothing more than the original and greatest version of crony capitalist, hiding behind the American farmer as their scapegoat. Capitalism WORKS, if you can keep it clean. Beware the government/industrial complex.

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