Poet LLC, the second-biggest U.S. ethanol producer, said it will idle a plant in Macon, Missouri, because there isn’t enough corn available.
The plant, which has the capacity to produce 44 million gallons of the fuel annually, is in one of the areas hardest hit by the worst drought since the 1930s, Sioux Falls, South Dakota-based Poet said in an e-mailed statement.
“Macon will temporarily suspend plant operations effective Feb. 1 due primarily to a lack of available local corn,” the company said.
Poet said it doen’t have a date for when it will resume output. The company will spend $14.5 million to upgrade the mill while it’s closed.
Denatured ethanol for February delivery fell 0.6 cent, or 0.3 percent, to $2.376 a gallon on the Chicago Board of Trade. Prices have gained 8.5 percent this year.
Corn for March delivery fell 3.5 cents, or 0.5 percent, to $7.2075 a bushel in Chicago. One bushel makes at least 2.75 gallons of ethanol.
Based on March contracts for corn and ethanol, producers are losing 23 cents on each gallon of the fuel made, unchanged from yesterday, according to data compiled by Bloomberg. The figures exclude the revenue that can be made from the sale of dried distillers’ grains, a byproduct of ethanol production that can be fed to livestock.
Aemetis Inc., another U.S. ethanol producer, idled production at a plant in Keyes, California, on Jan. 15, citing “unprofitable market conditions for corn ethanol,” and will upgrade the operation to make fuel from sorghum as well, it said in a Jan. 17 regulatory filing.
Ethanol production in the week ended Jan. 18 rose 1 percent to 792,000 barrels a day, the U.S. Energy Information Administration said yesterday, rebounding from the lowest level since the Energy Department’s statistical agency began tracking weekly data for the fuel in June 2010.
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