Published on October 28th, 2008 | by Adam Shake
Is the Ethanol Industy Failing or Flourishing?
Over the last few month’s we’ve seen a tide of News about the ethanol industry and it’s staggering growth, but in just the last few days, it seems as if the tides have turned. A confluence of events ranging from rising corn prices and falling gas prices to increased rains and late corn harvests that some say are due to global warming, have resulted in a number of ethanol plants either shutting down or not being built.
Just this morning, theKansas.com posted this article:
“A deadline quietly came and went this week — and the end result is the Emerald City Ethanol plant, which was to be built northeast of the Harvey County Transfer Station, will not become part of the landscape.”
“According to an update given by Mickey Fornaro-Dean during Wednesday’s meeting of the Harvey County Economic Development Council board, the company pulled the project Oct. 3 and did not renew an Oct. 20 option on land near the now-closed county landfill.”
“‘There are just an awful lot of factors at play here,’ Dean told the board. ‘There is still some interest there, but for now, they have walked away.'”
Similar stories such as these, are dominating the Biofuel headlines;
“A Mina ethanol plant will temporarily shut down because of limited corn in the area caused by wet weather, the plant’s parent company said Thursday.”
“The struggling economy forced Chesterfield, Mo.-based Abengoa Bioenergy New Technologies to temporarily shut down its Portales, N.M., plant, according to a newspaper there.”
A series of 11th-hour maneuvers leading up to the auction Thursday of a Cheshire biofuels plant, which was supposed to produce a new owner, instead resulted in the process being extended another three weeks.
More signs of tough economic times may have hit Montgomery County as the VeraSun Energy ethanol plant has ceased operations – at least temporarily.
Alabama Corn harvest yields down 30% from 10-year average, climate change blamed.
I recently wrote an article entitled “Oh No! Gas Prices are Falling!” In it, I said “Every time the price of oil drops, the demand for that same product increases and the demand for alternate fuels, decreases.” Needless to say, the comments were not in in support of raising gas prices. But I think that we need to question a few very important issues.
- How big a factor is climate change having on an industry that many think that we need to rely on? Do we want to put next years fuel crop at the mercy of the weather?
- It seems to me that our society does not care as much about the environmental impacts of a product as it does the cost of the product. With that being said, who would have controlling interest in the corn fuel markets? There would be quite a few fingers in this mathematical model, but a few of them would be the companies who own the patented seed, fertilizers and pesticides. Theoretically speaking, companies like Monsanto could be the next Exxon.
- If the prices of corn can be artificially manipulated for profit, then does not adding a second price trigger such as climate change, make crop grown ethanol a bad idea?
What are you’re thoughts?
Photo courtesy of tlindenbaum via Creative Commons license