ethanol

Just read that ethanol plant at Plainview Texas is shutting down because of low fuel prices and low useage.Will reopen when price rises.Ipersonally did not think this was a good deal for the country,but lots of money went into building it ,so what do you think about ethnal?

I"m with you.
When you do the numbers, it never added up. People jumped on it because it was the political thing to do, but it never added up.
I feel for those who lost there jobs and those who were invested in it.
Brian

Asking about ethanol is a touchy subject. Similar to discussing religion or politics.

A new 100 million gallon per year ethanol plant near New Hampton, IA is scheduled to open this spring. It is going to be operated by the same management that is currently operating the ethanol plant in Mason City, IA which seems to be profitable. I personally use as much ethanol as I can, as the money stays here in Iowa. The cost per mile figures out the same as gasoline.

Ken

I have a feeling we will see a lot of that in the not so distant future. Here has two, one in full operation and the other one has some issues with tank sinking in the ground. If I heard right the one with problems was built from ground up and has yet to produce any ethanol. Guess we will wait and see what happens.

Gary

A bunch in our area went belly end up also.

I predicted the gas price drop a long time ago, and suggested big oil will own the corn processing plants even. They probably will not pay full price to the courts either. Numerous farmers in our area layed down some large amounts of cash for their chance to make it big.

A lot of corn was contracted for big dollars, now a judge says todays price is what you get your % of if any. To bad judges don't get a very small % of their wages.

Alot of bad checks I understand also.

Ethanol plants producing fuel, not making profit. Fix up plant a little, get beverage distillers license and bottle the output for human consumption like Johnson distilling company did when they made 'Georgia moon'. The way nnalert and economy seems to be going a lot of people will want to get drunk. (sort of humor alert-might be a workable use for completed plants) RN

Ethanol is a joke, people are finally starting to wake up and realize it. Here in Iowa, it's a mortal sin to say one bad word about ethanol. There are hundreds of proven studies that say ethanol is a losing proposition, but the pro-ethanol groups will only accept the studies that are funded and done by groups like Farm Bureau, Iowa Corn Growers, etc. Hmmmmm.

At current prices it doesent make economic sense,even factoring in the greenie-weenie fuzzy warm feeling.Regular gasoline today spot market $1.16/gallon,ethanol today spot market $1.58/gallon.

I think they have been shipping quite a bit of ethanal,at least there have bee a very large number of new tank cars on the siding when I go by.Of course I have heard that the corn is all sripped in from out of state.

Every gallon of Ethanol made and used in the United States is a gallon of foreign oil we didnt buy.The foreign oil we do buy makes lots of people that hate us richer.I dont have a hard time seeing the benefit of Ethanol.It seems like every time farmers start to get a little ahead,some bunch of nay sayers comes along and tries to mess it up.If you dont like ethanol,and the money that goes to farmers,and would rather give it to Saudi Arabia,I guess you could bad mouth it.

What oil company wants to blend ethanol with gasoline when gas futures are around a buck-thirty a gallon? They would be throwing money away.
NYMEX gasoline futures

It makes good sense here in the upper midwest - Minnesota area. Our corn is typically 30-50 cents _less_ than the CBOT price. Some of you - like in Texas - might even have a positive basis, like 10-15 cents _more_ than cbot prices.

I agree ethanol plants in _those_ areas were put up with a lot of blue sky & little thought.

The Veradun deal with them going broke up here in Iowa, MN, etc was a management issue, they wanted to get fancy on the corn purchases and locked in corn long term at the highest price; now that corn is worth less than 1/2 of what they agreed to pay, of course the are going broke. That was a foolish move on their part, they shoulda been hedging off their purchases, and make money on the sales of ethanol and feed. Instead, they tried to speculate on the price of corn - and got stung.

Many other ethanol plants up here in the midwest are still doing just fine - they built wisely, located well, and run their business properly.

In those cases, ethanol works well as a small solution to the energy situation we face in this country. The bigger isssue tho is not energy - ethanol produces cleaner air, and better combustion, and better octain. This allows us to crack our crude oil in better ways to get more product out of a barrel.

It's a very intigrated process.

--->Paul

I agree with you 100%.

what I wonder in my own mind is------------some government secret office said, what can we do if we were suddenly faced with no fuel from the mid-east.

If this happened, we could blend ethanol with gas and stretch it out for other users.

I know, ethanol is generally a loser, but maybe there is some good for our country.

Some of the ethanol plants were financed in a pyramid scheme type fashion in which the first round of investers made made some healthy profits,which I have nothing against, but for long term sustainability, it usually doesn't work. We all seem to want a fast track to riches and forget about the long term. I would like to know why North Dakota sweet crude trades 10 to 20 dollars under Mideast crude. I think that comodities should only be traded by producers and end users, in other words by if you are going to trade in pork bellies you better have a big refridgerator. Speculation is what caused the crash in "29". We seem to learn so very little.

Your right, every gallon produced is one less bought, this is true for any and all domestic energy sources including oil and natural gas. So why was one of the first acts of the new administration to block expanded offshore drilling and shut down development of western oil shales? Could it be because the new President is indebted to the America hating, nut fringe of the nnalert party? I am speaking about many of the same people who manufactured the whole ''world is running out of oil'' lie and sold it to the complicit, America hating main stream media who in turn shoved it down the throats of a gullible, uninformed public.

Yes, speculation run amuck can cause real issues.

On the other hand, with no speculation allowed, we get into shortages & oversupply too much. Speculation helps to keep supply matched up with demand _most_ of the time, and is a very useful tool to a mostly free market.

Without speculation would be a bad thing too.

--->Paul

The commodity market was designed so, in the case of wheat, the miller could be reasonably confident he could purchase wheat at a future date for said amount and the farmer could sell at a future date for a price agreed upon. When outside speculators get into the picture and trade paper the market becomes confused. True supply and demand is great. Manipulated supply is not. It drives up consumer prices, devalues currency, and lowers the standard of living. The common denominater in every society that has fallen has been instability.

my thoughts exactly. Here in corn state we have some farmers against it tho. As far as running out of corn for food that is a myth. we have a lot of land out of production. Oil companys will be buying up eth plants for 10cents on the dollar

Mike Lee, Objection foundation! Please explain to us how: "Speculation is what caused the crash in "29"."

Just read in the Amarillo paper that the Hereford Biofuels plant owned by Panda Ethanol is up for sale because they have file for bankruptcy. I think that is the one that has never produced a drop because of tanks sinking.

Does Ethanol have more power than gas?
If not, then you are just taking away the power in a gallon of gas by however percent added.
So then you would have to use more gallons of gas to go as far. Then you have to add the cost it took to make the Ethanol which doesn't add up.
That's like adding water to the gas and saying it's saving energy because you now have more gas. People get worse gas milage with Ethanol and it's harder on an engine. It's time to put the old combustion engine away and push for a new design in engines, sorry to say.

Went and read what you reffered to of external_link blocking offshore drilling and oil shale production.external_link didnt do anything.That is something that a "critic"dreamed up.Stuff like that causes trouble when there is no need for it.
Off shore drilling is a lot more complicated than just letting somebody drill out there anyway.Read up on it and you may not like it either.Swartznegger is against it,far as I can tell,hes a nnalert.

I have made my living in the offshore drilling industry for well over 30 years, I don't know what you refer to as ''complicated'' about it. I think you have been reading a pack of abundant fairy tales about the energy business in general and the offshore business in particular.

I dont live next to a beach,so if it gets an oil slick it doesnt really bother me much.Since you used to drill offshore for a living,the reason most people living on the coast dont like it is this,oil companies want to drill,take the profit,and if they spill it and mess up the coast the oil company doesnt want to do anything about it.Thats the most part of it.Yes oil is important,but ever since the beginning its been run by greedy corrupt people.Now they have excluded the oil company from environmental damage by having a separate company drill for it,a different company to transport it,and a different company to refine it.It is complicated,if any gets spilled they all point their finger at the other guy,and the taxpayers get stuck with the bill.
Now if the oil company wouldnt act like a 2 year old kid and throw a tantrum because the people living on the coast like to play on the beach without the oil slick,then maybe there wouldnt be a problem drilling off the coast?

You are wrong on so many fronts: college and field tests show no more or LESS wear with ethanol, there is an insignificant mileage decrease with ethanol and possibly even a gain in computerized engines because of the the higher octane allowing more advance in timing and a leaner mixture because of the oxygen content allowing a more complete ignition.. And to keep the green people happy the air is cleaner.

Come on, that tripe is straight out of some abundant focus groups talking points. The media hates big oil,if there was an oil spill caused by drilling you would see it on TV non-stop. The oil spills almost always happen with tankers, transporting foreign oil. Fact -- the US minerals management service states that there is more natural seepage of oil onto the beachs in coastal california every year than has ever been spilled by drilling since drilling began. How do you reduce natural seepage? - drill and produce. Go to Louisiana, Texas, and Mississippi and ask people whether they like the industry or not. Don't forget there are alot of people in this country who think modern farming is bad for the envioroment, most people who believe this have never seen a farm up close.

The housing bubble - or perhaps even the dotcom bubble of a few years ago - started the current ecconomic issues. People had savings, and were looking to stick them into the best bang for the buck. As the bubbles burst, people took their money & went to other areas. One of the last places that was holding it's value & making money was commodities. Copper, iron, crude, grains. All other segments had tanked, so a lot of folks were piling their money into commodities - which drove the price of them unusually high.

It is a natuaral reaction to an unstable ecconomy, and yes this causes problems.

But that is pretty rare.


The marketplace works well when conditions are closer to normal, and wheat processors buy wheat, and wheat growers sell wheat.

The problem is the wheat buyers don't like to spend money early, and a wheat grower tends to be planning his wheat growing 24 months ahead of the time he can deliver it.

These 2 groups have a very hard time getting together so that enough wheat is grown to cover demand, plus a little extra. Both sides are concerned about their own personal issues, and not concerned about world issues, world weather, etc etc.

Along come the speculators. They sit in an office, and look out long term. They see bad weather here, they see a whole lot of extra acres of wheat planted over there, they ponder what will be happening 2 or 5 years from now.

With all that study, they guess perhaps we will be short of wheat in 23 months, and so they buy some on paper today, figuring it will go up in value.

Both farmers & wheat processors notice this change in price, and they react - wheat processors change how much & when they buy some wheat; farmers decide wheat is a tad more profitable and plant a little more.

Or, if the speculators guess there will be a big oversupply of wheat in 2 years, they start to 'short' the market, selling wheat they don't have. This depressed the price of wheat, and wheat processors are happy they can buy cheap wheat, and farmers get disappointed on what wheat is worth and tend to grow a little less.

In either case, the wheat supply tends to match what the wheat buyers end up needing.

The speculators make or lose a little along the way, depending if they guessed right.

Now, without speculators, there is no early correction to the market. The wheat processors could decide there is a lot of wheat around today, and pay almost nothing for it. Wheat growers will stop growing wheat. The wheat processors don't care, they want cheap wheat today, and don't pay any more for it. The following year they still don't pay much for wheat, but there was a lot left from the year before, so there is just barely enough wheat available, so everyone enjoys really cheap wheat.

But - then - the following year we are critically short of wheat. & farmers still have none planted in the ground, because it is worthless. So even if wheat prices finally skyrocket, there _still_ will be no wheat available for this year or the following one.

People will go hungry. The ecconomy will be deeply disturbed.

Or perhaps the wheat farmers will decide to charge a high price for wheat, even tho there is a lot available, and pretty much the same thing; we get piles of wheat sitting around, too expensive for people to buy - messes up the ecconomy & food supply. One side or the other will manipulate the market with a bad ending.

These trends & manipulations get nipped in the bud, and long range supplies of our basic needs are generally much better met _with_ speculators.

I much prefer a world with speculators, tho I cuss at them probably as much as you do - which is about 50% of the time. Think about it, the other 50% of the time they are helping out your point of view. You weren't complaining about speculators back when wheat was $2.40 a bu forever - keeping your bread & pasta at historic lows?????

What happened last year was a real odd thing - the ginat fund markets got involved in placing lumps of money into the coomdities. These were not typical speculators - these were investors. I consider that a whole different thing, and very abnormal brought on by the abnormal ecconomy.

--->Paul

I'm interested in the new design of engine. Hoping it comes soon.

Until then;

Ethanol returns 25-33$ more energy than it consumes to make - in btus.

It adds octaine to the peto portion, so you don't need to refine the peto quite as much.

It makes a cleaner burning fuel, so there is less pollution coming from the tailpipes.

It does not corrode metal - that is a wives' tale started by anti-ethanol folks with an axe to gring. It is true of _methanol_ which is a type of ethanol made from petro. Grain ethanol made from corn or other grains is not corrosive. It is hard on certain types of rubber/ gaskets, so the proper plastic/rubber materials must be used is about the only physical issue.

You are wrong on everything you heard about grain ethanol......

Fine if you oppose it, but then come up with a better idea? Ethanol is doing something. You are only opposing - not doing anything?

--->Paul

No ethanol promoter is saying it has more power than gas. We all know differently- maybe up to 30% less. My experience with a flex-fuel Dodge van- we lost 11% on mileage over several years of use. E-85 is typically 40 cents per gallon cheaper than gas. Do the math- still pays to use it. So much mis-information touted by know-nothings. Quoting you- re: power reduced by percentage added....E-85 would reduce the power by 85%? It is really difficult to remain civilized, responding to something as ridiculous as that- because someone might believe that statement, which makes no sense whatsoever. ie- I was nice, and rewrote my first response!

Oh man - look, I agree maybe Trucker went a little too far with his rant, but to say "the media hates big oil"? The "media"? like, newspeople? Why?

People always say "the media hates this. The media is against that". I don'y think "the media" has much of a say in things these days, what with the Internet giving us instant access to information, from many different perspectives.

Or mis-information, again from many different perspectives.