Economist: Year-Round E-15 Won’t Help Corn Markets

October 15, 2018 04:30 PM

President Trump announced that he wants E-15 to be sold all year. While ethanol and corn industry groups alike have been pushing for year-round E-15 for years, will it really help markets? One economist says no.

Agriculture and ethanol industry groups praised the president’s announcement made in Council Bluff, Iowa last week.

“Corn farmers across the country have been advocating for year-round sales of higher ethanol blends like E15 to help grow demand, provide consumers with more options at the pump and improve economic conditions across rural America,” said National Corn Growers Association president Lynn Chrisp in a statement. “We thank President Trump for following through on his commitment to America’s farmers.”

However, one economist isn’t sure this announcement will help work through the massive corn stocks on hand, the huge crop that’s coming in from the field, or even the increase in corn acres expected next year.

“I don’t think it will help the balance sheet this year,” says Scott Irwin, an economist at the University of Illinois. “And I'm confident not for next year.”

Regardless, the renewable fuel has a long road ahead before you’ll be able to find it at a Casey’s near you. First, the EPA will need to write some rules about how to make the year-round status happen. Then those will need to be approved. In addition, the oil industry is expected mount a court challenge.

The administration's other focus is the EPA’s use of the small refinery exemptions or SRS. Irwin says ethanol usage has been holding strong, despite the EPA running some refineries out of the mandate to produce gasoline blended with ethanol.

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Spell Check

I can read, IN
10/18/2018 04:47 AM

  To those that are saying “ folks can’t read” well, we can read and smart enough to know that this economist is wrong and so are you. With increased demand comes a potential increase in price or at least support at current levels. Why will the E15 help NOW? Because we have what’s called a “ futures” market!!!! Price at the cbot reflects future or precieved demand many times. Knowing this new demand is coming on board WILL affect price currently. Sorry for those that need to take Econ 101 or a basic knowledge of how FUTURES markets work.

Jonesboro , AR
10/18/2018 07:49 AM

  Glad to hear only Democrats/liberals/lefties can read. This is an example of arrogance in its highest degree. It's also a big reason Trump is president.

Axel stordal
Reynolds, ND
10/16/2018 09:28 PM

  Pay attention before you sheep follow Donald blindly. Read the last paragraph about the small refinery exemptions that were meant for small refineries. Donny has been giving them to large refineries such as the one owned by his good buddy Carl Icahn. That is why the price of ethanol has not been following the price of oil upwards. E15 helps but it is a year late and won't make up for the damage trumps epa has done with these exemptions


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