http://www.detroitnews.com/article/20111224/AUTO01/112240320/1148/rss25
Wonder how bad this will be for E85 users.
I think not at all actually.
^this
from what I read they are just ending the subsidizing of American ethanol that is more expensive then foreign options. The arguements fore and against are longer then I really feel like inteligently commenting on right now.
Fuck. So much for growing a fuckton of corn from now on and making bank. I guess we’ll see what the market does to the price in the fall. At least we haven’t invested in another combine and any drying equipment yet.
Edit - Actually super interested in this. With less money being paid for corn the price might drop enough that a lot of growers start looking for alternatives and a lack of supply in the year following the next might even jack up prices.
The 15% or so is still going to be commonly used and mixed with regular gas, that alone is likely as much of the demand as E85. Subsidy might not be there but I doubt demand will drop.
Market wise they can’t really raise the price as people will stop using it once it’s no longer cost efficient.
Price of e85 won’t raise, but the price of the corn being bought from farmers will drop without the subsidy. Demand won’t drop but the supply will if the price per ton of corn does, which it likely will. Farmers can grow whatever they want, no reason to keep growing as much corn if the price drops substantially.
Well if supply, drops the demand for the lower supply will increase allowing those still growing corn to increase their selling price to compensate the lack of subsidy. :ponder
Which you can clearly see in first post in this thread. Hence me saying it will be interesting to watch. Some growers might opt out regardless. I know if the price does drop this year like I expect it to, at least one local guy who was going to switch from dairy and hay to dairy and corn will be sticking to his current setup.
Also, sellers don’t control the price. The buyers do. Most growers do not have the necessary storage and drying equipment required to have any sort of control over the price (250,000$ investment by the time you’re done) so when they have enough to make a load it’s trucked by a contracted company or by their own trucks to lutz, hewitt’s, or one other place who’s name I forget. The truck is weighed and you get whatever they’re paying at that time. If you don’t like it, truck your corn home.