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Indiana Ethanol Summit A Mixture of Optimism and Frustration

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Indiana Ethanol Summit A Mixture of Optimism and Frustration

 

Neil McKinstray, head of the ethanol division of The Andersons,
Neil McKinstray, head of the ethanol division of The Andersons,

The 4th annual Indiana Ethanol Forum brought together state and national leaders on Tuesday to discuss the current state of the industry and future prospects for corn-based fuel.  Sponsored by Indiana Corn Growers, the Forum presented a picture of an industry with many successes and enormous frustrations.  Currently almost all of the gasoline sold in American contains 10% ethanol. Indiana is one of the top ethanol producing states in the nation with over 3,500 full time jobs in the state tied to the ethanol industry. There are 14 flex fuel pumps locations around the state, and Indiana’s ethanol plants provide a market for Hoosier corn. But major challenges and political obstacles are slowing progress in the renewable fuels sector.  Neil McKinstray, head of the ethanol division of The Andersons,  told the forum that oil  companies continue to try and defeat the Renewable Fuel Standard (FRS). He told HAT that the lack of a Farm Bill is also adding to an uncertain future for ethanol, “The lack of movement on a Farm Bill and the current situation in Congress are hurting lots of industries including agriculture and ethanol.”

 

McKinstray said there may be some consolidation within the ethanol processing industry as a lack of corn from the 2012 crop continues to cut into the margins for processors, “There are some plants that are not going to get enough grain this summer.” He said some of these operations may not have the financial resources to deal with the situation. Cash bases in the Eastern Corn Belt is very high.  Some processors are having to pay  more than $1 over the futures price in order to get grain.   McKinstray says the situation should improve when harvest begins and the new crop becomes available. Longer term he remains optimistic citing the improvements and new technologies ethanol processors are using to make their operations more efficient and more environmentally friendly.

 

Pam Keck
Pam Keck

Pam Keck, from the National Corn Growers Association, says slow growth in a retail infrastructure for e-85 and mid-level blends like e-20 or e-25 is also making it harder to get more people to use ethanol. But she remains optimistic that in time, ethanol will succeed, “With any new technology, it just takes time. It took a while for the light bulb to catch on; radios just did not appear in everyone’s home after only a few years. I think the same is true tor renewable energy.”  She said one of the keys is getting more flex fuel cars on the road. She added that there are currently 14 million flex fuel vehicles on the road and that, if they all used e-85 every time they filled up, it would increase ethanol demand by 8 billion gallons a year.

 

The Indiana Ethanol Forum was held at the Andretti Autosports complex to highlight the connection between the racing industry and ethanol.  Corporate sponsors of the event included Dow AgroSciences, Farm Credit Services of Mid-America, and DuPont Pioneer. Other speakers included Jeff Lautt, POET; Herb Ringel, Indiana Corn Growers Association; and Dennis Maple, Indiana Corn Marketing Board.