Renewable Energy & Climate Change

April 2016 Monthly Renewable Energy Report

Brought to you by the Iowa Grain Quality Initiative and Decision Innovation Solutions.

 

Greetings!

The Renewable Fuels Monthly Report is now being produced as a partnership between the Agricultural Marketing Resource Center operated by the Value Added Agriculture Program at Iowa State Extension and Outreach (ISUEO), the Iowa Grain Quality Initiative (IGQI), an ISUEO program directed specifically at grain processing and handling, and is authored by Decision Innovation Solutions, LLC, an economic research and analysis firm located in Urbandale, Iowa.

Current and Historic Analysis of U.S. Ethanol and DDGS Trade

Based on the latest U.S. Bioenergy Statistics monthly data from USDA-ERS (USDA-ERS, 2016), U.S. ethanol production in December 2015 was 1.3 billion gallons, increasing 5% from the previous month and about 1% from a year ago. U.S. domestic ethanol production during 2015 reached a volume of 14.8 billion gallons (see Figure 1), rising 3.4% from the same period last year. U.S. biodiesel production has increased from 343 million gallons in 2010 to 1.278 billion gallons in 2014, an increase of 272% for the five-year period. Biodiesel production during the first ten months of 2015 reached a volume of 1.048 billion gallons, close to the total pace of production during the first ten months of 2014, as shown in Figure 1. 

Overview of Current Ethanol Market: Prices, Production, Profitability, and Co-Products

The U.S. ethanol industry will face several notable challenges in 2016, mainly low ethanol prices, high stocks, and a low production margin. The blending value of ethanol is largely correlated to the price of gasoline. As shown in Figure 1, the average rack price of ethanol in February 2016 was $1.46 per gallon and the average rack price of gasoline was $1.02 per gallon.

Monthly Feature: Corn Ethanol Efficiency and Energy Balance

Ethanol yield can be broadly defined as the number of ethanol gallons per one bushel of corn. This number can vary from dry mill plant to wet mill plant. According to a U.S. Energy Information Administration (EIA) report published in May 2015, the ethanol average yield was approximately 2.8 in 2014 compared with 2.5 in 1982

Prices and Profitability Models

Ann Johanns, aholste@iastate.edu The spreadsheets listed below provide data and trends for various components of the renewable energy industry. These files are updated with new information each month. Energy prices and their grain feedstock prices are commodity prices that are vulnerable to large swings over time.