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Will 2009 go down as 'The Year of Ethanol?'

Agriculture.com Staff 10/20/2008 @ 2:55pm

Despite tortuous market conditions for the industry in recent months, the ethanol industry continues strides of growth that will ultimately position the fuel as the "largest supplier of energy in this country," say industry leaders. All in all, look for a big year for the business next year, both for ethanol fuel and distillers grains for livestock feed.

"We are confident the U.S. ethanol industry will continue to grow due to efforts undertaken by the National Corn Growers Association and state producer organizations over the last several years," says U.S. Grains Council CEO Ken Hobbie. "Due to the efforts of U.S. growers to establish the ethanol industry, we made DDGS our top priority in 2006 and since then have seen DDGS exports exceed 2 million metric tons annually."

Total ethanol production capacity is expected to reach 11.9 billion gallons in 2009, up from an estimated 9.3 billion gallons this year. Alongside that production, around one third of the grain going into the refining process will exit as distillers dried grains to be marketed as livestock feed.

"Who would have believed five years ago that the ethanol industry would be the largest supplier of energy in this country," says Bruce Rastetter, CEO of Hawkeye Renewables. "That will happen by the conclusion of 2009."

Rastetter and Hobbie's remarks came at the recent U.S. Grains Council International Distillers Grains Conference (IDGC) in Indianapolis, Indiana.

Looking ahead, industry-watchers say the availability of distillers dried grains will likely double in the 2008-2009 marketing year that began at the beginning of October. In addition to helping meet domestic livestock feed demand, that product will also reach foreign shores, boosting U.S. trade output, according to Informa Economics vice president Scott Richman.

"There will be a substantial amount of DDGS available for global livestock industries," Richman says. "It looks like we are going to be pushing more DDGS into export markets. The U.S. Grains Council's efforts promoting U.S. DDGS and opening several new markets across the globe is helping the U.S. ethanol industry in a big way. As production increases, the Council will have more opportunities to expand markets for this co-product."

Despite tortuous market conditions for the industry in recent months, the ethanol industry continues strides of growth that will ultimately position the fuel as the "largest supplier of energy in this country," say industry leaders. All in all, look for a big year for the business next year, both for ethanol fuel and distillers grains for livestock feed.

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