Revised April 2022
Ethanol and biodiesel are the primary renewable fuels produced in the U.S. today. Fuel-grade ethanol is produced by fermenting starch and sugars in plant materials to yield a colorless, clear liquid that is sometimes called grain alcohol, ethyl alcohol, or EtOH. It has the same chemical properties regardless of whether it is made from grain, sugar cane or beets, or cellulosic grasses and wood fibers. Fuel-grade ethanol contains a small amount of denaturant, such as gasoline added before it is sold as motor fuel, and does not affect its performance, but distinguishes it from beverage or pharmaceutical alcohol.
Within the last ten years, US fuel ethanol production has grown to be the major player in renewable fuels supply. Besides reducing US dependence on foreign oil, it provides a motor fuel with significantly lower emissions that will meet standards set by the Environmental Protection Agency under the Clean Air Act. In rural America, the boom in ethanol production has become a driver of economic development by adding significant value to bulk agricultural commodities, such as corn and sugar beets.
The US is the leading ethanol producer in the world, generating twice as much ethanol as Brazil, the world’s second largest producer. In the U.S., there are 197 ethanol refineries capable of producing just over 17.5 billion gallons per year.
Ethanol can be produced from any feedstock that can generate significant amount of glucose, a fermentable sugar. Corn grain is used in most systems because it is plentiful and easy to store for year-round ethanol production, although ethanol is also produced from wheat, sugar cane, sugar beets, plant fiber, and even carbohydrate-rich municipal waste (paper).
Corn-based ethanol production systems are called “dry-grind” because the grain feedstock is ground prior to fermentation and the entire kernel is fermented. In this system, ethanol and the other co-products are separated following fermentation. From one bushel of corn (56 lbs.), an ethanol producer can make 2.8 gallons of ethanol, 18 lbs of livestock feed (distillers grains) and 0.6 lb of corn distillers oil.
The first three commercial-scale cellulosic ethanol facilities began production in 2014 in Iowa, Kansas, and Oregon using combinations of corn stover, corn cobs, switchgrass, and wood. Meanwhile, corn-based ethanol plants have improved their processes to utilize corn bran as an additional carbohydrate source to produce more ethanol, and to extract corn oil as a co-product that can then be used to produce biodiesel fuel. Technological advancements in fermentation and corn fractionation will continue to allow ethanol producers to be more efficient and profitable.
For most dry-grind corn ethanol plants, the major co-product is “distillers grains” which are the remaining components of corn after the starch has been fermented into ethanol. Distillers grains are used as feed ingredients in rations for beef and dairy cattle, swine, poultry, and fish, and they may be fed as a wet product (more than 60% moisture) or a dried product (approximately 10% moisture.) The dried distillers grains from corn contain, on average, 30% protein, 10% fat, and 7% fiber (on a 10% moisture basis.) There were approximately 35.3 million short tons of dried distillers grains produced by the ethanol industry in 2021.
More than 80% of US ethanol plants are now able to extract corn oil following the fermentation step, allowing the plants to sell into a wider variety of markets. This oil, known as Distillers Corn Oil, may be used as a feed ingredient or as a biodiesel feedstock. Because oil is removed from the stillage, the resulting dried distillers grains will have higher protein and fiber contents than the original distillers grains co-product.
In the US, ethanol is blended with gasoline as a motor fuel, usually at a rate of 10% ethanol (E-10), although Flex-Fuel vehicles can be run with blends up to 85% ethanol (E-85). Because ethanol has a higher octane rating than gasoline, the addition of ethanol in fuels raises the octane level while keeping the price comparable to lower octane gasoline. US ethanol production is determined largely by the Renewable Fuel Standard, which requires oil companies to blend increasing volumes of renewable fuels with gasoline and diesel.
- Midwest Ethanol Cash Prices, Basis Data and Charts for Selected States
- Ethanol, Corn and DDGS Prices at Production Facility by State (xls), Ann Johanns - updated monthly.
- Ethanol Futures Prices, Cash Prices and Basis by State (xls), Ann Johanns - updated monthly.
- Fuel and Grain Price Historical Comparisons, Ann Johanns.
- Tracking Ethanol Profitability - Don Hofstrand and Ann Johanns - updated monthly
- Tracking the Profitability of Corn Production - Don Hofstrand and Ann Johanns - updated monthly
- Effects of Recent Fossil Energy Market Developments on U.S. Ethanol, Agriculture and Food Policy Center, Texas A & M.
- Feed Ingredient Co-Products of Ethanol Fermentation from Corn – Purdue University.
- The Value of Distillers Grains as a Livestock Feed – Purdue University.
- Storage of Wet Corn Co-Products – University of Nebraska.
- Utilization of Corn Co-Products in the Beef Industry – University of Nebraska.
- Use of Dry Distillers’ Grains with Solubles by Poultry – Purdue University.
- Value of Distillers' Grain Ethanol Co-Products to Dairy Replacements – Purdue University.
- Value of Distillers' Grains for Lactating Dairy Cows – Purdue University.
- The Influence of Dried Distillers’ Grains on Carcass Fat in Swine – Purdue University.