Poet LLC, the second-biggest U.S. ethanol producer, resumed operations at its Macon, Missouri, mill, two months after shutting the plant down because of a shortage of corn.
The company made upgrades that allow the 45 million-gallon-a-year mill to make corn oil and to run more efficiently, Matt Merritt, a company spokesman in Sioux Falls, South Dakota, said today in a telephone interview.
Poet joins Valero Energy Corp., the third-biggest U.S. ethanol producer, and Abengoa SA, a Spanish renewable energy company, in restarting output at previously idled distilleries as corn costs have tumbled. Corn rose to a record high last year after the worst drought since the 1930s shrank yields, prompting as many as 20 ethanol plants to idle output, according to the Renewable Fuels Association in Washington.
The corn crush spread, or the difference between the cost of a gallon of ethanol and the corn needed to make it, was 11 cents a gallon today, compared to minus 35 cents on Dec. 31, data compiled by Bloomberg show.
The amount doesn’t include revenue from the sale of dried distillers’ grains, a byproduct of ethanol production, which can be fed to livestock.
Denatured ethanol for May delivery dropped 2.9 cents, or 1.2 percent, to $2.43 a gallon on the Chicago Board of Trade. Prices have gained 11 percent this year.
Corn for May delivery fell 7.25 cents, or 1.1 percent, to $6.385 a bushel in Chicago. One bushel makes at least 2.75 gallons of ethanol. Prices have dropped 8.6 percent this year.
Ethanol production has averaged 804,000 barrels a day this year, down 12 percent from 2012 levels, data from the Energy Information Administration show.
Archer-Daniels-Midland Co. is the leading ethanol producer.