U.S. Ethanol Ready For The World Market

Rail cars transport ethanol from production locations to storage and ports.
Rail cars transport ethanol from production locations to storage and ports.

The United States has plenty of ethanol and is ready and willing to meet foreign market needs. As the U.S. Grains Council (USGC) works with its industry partners to develop markets and enable trade, ethanol, a grain-based renewable fuel, is growing in importance.

In the United States, ethanol is made primarily from corn, for which the U.S. Department of Agriculture (USDA) is predicting record crops over the next decade. With more than 200 ethanol plants scattered across 29 states, the United States is capable of producing more than 15 billion gallons (56.7 billion liters) of the renewable fuel per year – more than American consumers use – providing ample supply for both the domestic market and the burgeoning export market.

“We’re currently the world’s largest net exporter, producing more ethanol than we are consuming,” said Mike Dwyer, USGC chief economist. “That puts us in the position of being able to meet international buyers’ long-term needs.”

Industry experts estimate the current U.S. inventory at 22 million barrels, the highest level since early 2012.

New biofuels technologies and infrastructure improvements are paving the way for increased export potential. Likewise, the efficient U.S. transportation system includes unit trains, entire trains of ethanol-filled tanker cars that travel from production locations to ports where one of the world’s largest shipping fleets awaits.

A well-established marketing system means U.S. ethanol offers a competitive price, especially relative to Brazilian ethanol at the point of export. Government and industry investments have helped the industry build to where it is today, and technological advancements including the use of new feedstocks place the industry in a position for additional future growth.

“The U.S. ethanol industry is in a strong position,” Dwyer said. “It is already capable of meeting international demand, and there is room for even more growth.”

Ethanol is gaining in popularity throughout the world, with new markets continuing to emerge. As the world strives to meet goals set by global climate initiatives, ethanol can provide an affordable solution.

“Ethanol is a high-octane fuel, with a 113 octane rating,” Dwyer said. “That makes it an ideal blend in countries where decreased use of fossil fuels is a goal.”

Using its expertise developing international markets and market-specific education, the Council is working with the Renewable Fuels Association, Growth Energy and the USDA’s Foreign Agricultural Service to help develop ethanol markets around the world and connect foreign buyers with U.S. producers and traders.

The world wants ethanol, and the U.S. ethanol industry is ready, willing and able to meet the global demand.