cancel
Showing results for 
Search instead for 
Did you mean: 
Highlighted
Veteran Contributor

Sugar Ethanol

Thursday, the USDA initiated a new “Sugar for Ethanol” program to mitigate the costly US sugar storage and reduce huge stocks estimated at 2.3 MMTs. It takes roughly 400,000 MTs of sugar to replace 20 Mil Bu of corn to produce the same amount of ethanol. Some commercials argue that at least 60-70 Mil Bu of corn will be replaced in ethanol produced by sugar. Its announcement has angered US corn growers and comes at a time of surplus US corn stocks (they are stored by the US farmer – not the Gov’t!)
0 Kudos
5 Replies
Highlighted
Senior Advisor

Re: Sugar Ethanol

Interesing - there aren't any excess corn stocks yet.  Maybe will be, but not in the bin today.   This program would mean at the most about 450 million bushels of corn.  Not a drop in the bucket, but we'd have to see how it played out.  If corn were a little cheaper some of the demand would be picked up by feed and export.  I don't konw what the price impact on corn would be.

0 Kudos
Highlighted
Veteran Contributor

Re: Sugar Ethanol

Jim,I'm a little confused when you say 450mil bu is a drop in the bucket. 

0 Kudos
Highlighted
Senior Advisor

Re: Sugar Ethanol

I said it was not a drop in the bucket but that does imply it is not a huge factor.  I probably didn't say all that very well.  I guess my first reaction was that while it might affect the market, a lot of it would be picked up by demand if the price softened.

 

What do you think?  Would it be a big hit, in your opinion?

0 Kudos
Highlighted
Veteran Contributor

Re: Sugar Ethanol

I'm not sure what  remains after sugar is used, but I assume not much, whereas corn based has distillers grains which is a very much used feed product.  If you don't use corn and sugar leaves very little then the corn useage for feed would rise. So not the huge impact as saying 450 mil of corn demand gone. 

0 Kudos
Highlighted
Veteran Contributor

Re: Sugar Ethanol

I can see where the confusion occurred. It is amazing how words can be misunderstood, even with everyone having the best intentions.

0 Kudos