American biofuel plants filing for bankruptcy protection
This is not the time to be betting on first-generation biofuels. Add up the increasing cost of feedstocks and an overall tough economy and it's no great surprise that "going yellow," as it were, is not the easy path that some made it seem a year or so ago. The reality is hitting home. According to Reuters, about a dozen biofuel plants across the U.S. have filed for bankruptcy protection thanks to corn shooting up to $8 a bushel and ethanol's "miserable profit margins." The affected plants are mostly small or mid-sized facilities, a biofuels expert told Reuters, and he said he expected more to announce bankruptcy soon.
On top of the financial problems, many ethanol plants are only operating at 50 percent capacity and previously-announced plants are being stalled or stopped completely. Who knows how much longer blending E85 into gasoline at the pump will be a way to save a few bucks.
[Source: Reuters]
Reader Comments (Page 1 of 1)
jpm100 12:46PM (6/30/2008)
I don't think anyone thought corn ethanol was viable just yet.
But I'm surprised. Most ethanol is blended to make E10 for oxygenation requirements especially with MTBE becoming banned.
Just a guess but investor cash dries up in hard economic times. I would suspect some of those plants were betting on future demand and not current demand. And counting on investors to see them through to that time. The negative press and uncertainty with Congress combined with the economic times may have make the investor cash dry up.
The question becomes if there isn't enough ethanol to satisfy E10 requirements, do we go back to MTBE or drop the additive altogether?
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BlackbirdHighway 1:16PM (6/30/2008)
Ironic that as oil hits record high prices we should be switching to alternatives, and the folks who make the alternatives are going bankrupt.
The price of corn was already very high, but went a lot higher with the loss of fields from the recent floods in the Mississippi river basin. More irony there, as in the old days the river would flood and that would replenish the fields with fresh rich soil, making for a bountiful harvest. Now, it washes away both crops and the fossil fuel based fertilizer that was put down.
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Karkus 1:27PM (6/30/2008)
Wow, just a year ago they were building them as fast as they could, and now the bubble has apparently burst. This despite the huge ethanol subsidy, biofuel mandates, and the GM/Ford yellow-washing campaigns.
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Mark Mitchell 1:51PM (6/30/2008)
Aside from noting I'm doubled over with tears of laughter no further comment is needed.
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Stan Peterson 7:25PM (7/02/2008)
My feelings are captured by exactly your comments.
ROTFLOL !
BTW, When do the subsidies expire?
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MikeW 10:32PM (6/30/2008)
E 5% is fine with me.
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Nobody Special 10:58AM (7/01/2008)
I hate to see any of the workers losing jobs. But how can it (ethanol for example) be justified when at best it takes five gallons of groundwater to produce one gallon of ethanol. The groundwater table is permanently reduced instead of being conserved for wise use for human-based crop food production for the future.
Too, it gets less MPG per gallon. An unfortunate and once again short-sided plan that isn't the answer. MTBE? I far as I know, European fuel doesn't contain it, and I understand that Euro fuels are more refined. Look at the MPG figures there - they are higher for the same vehicles and are as clean. I'm sure the born again idiots in Washington will save us with their er, uh, uh, plan....DOH!
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Noah 11:27AM (7/01/2008)
And there it is. Maybe we can learn from our mistakes, not make fuel from food. Use algae for biodiesel, waste cellulose for ethanol. Or hopefully LS9 gets going, and we can have 104 octane biofuel, which would be loads better than ethanol (or mixed with ethanol to give better emissions)
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