Message Font: Serif | Sans-Serif
 
UnThreaded | Threaded | Whole Thread (4) | Ignore Thread Prev Thread | Next Thread
Author: pauleckler Big funky green star, 20000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 18415  
Subject: Ethanol: Import duty and Tax Credit expires Date: 12/28/2011 2:55 PM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 0
http://westernfarmpress.com/government/us-opens-market-impor...

This should mean a flood of imported ethanol from sugarcane especially from Brazil. Article says that cane ethanol is greener than corn based ethanol.

End of blender tax credit should remove one incentive to use ethanol.

It will be interesting to see how the market adjusts. We will learn soon if corn ethanol can compete. And what will happen to ethanol pricing in Brazil?
Print the post Back To Top
Author: steve203 Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 18004 of 18415
Subject: Re: Ethanol: Import duty and Tax Credit expires Date: 12/28/2011 4:48 PM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 0
End of blender tax credit should remove one incentive to use ethanol.

Doesn't matter. Federal mandate requires the use of ethanol.

Steve

Print the post Back To Top
Author: pauleckler Big funky green star, 20000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 18005 of 18415
Subject: Re: Ethanol: Import duty and Tax Credit expires Date: 12/28/2011 8:59 PM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 0
But Brazilian ethanol will probably be cheaper in ports along the Gulf and east coast. So corn based ethanol probably won't get shipped as far.

Then comes the secondary effect on corn prices. The market should seek out a new equilibrium point.

Ethanol use requirements in gasoline are complex. Some states have their own requirement. Some fed regulations require unspecified oxygenates. Ethanol was chosen by oil companies when Congress refused to protect them from MTBE lawsuits--MTBE being the other oxygenate available for blending.

And there are some ethanol mandates which are being adjusted due to nonavailability of cellulosic ethanol.

Print the post Back To Top
Author: steve203 Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 18006 of 18415
Subject: Re: Ethanol: Import duty and Tax Credit expires Date: 12/28/2011 11:26 PM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 4
Then comes the secondary effect on corn prices. The market should seek out a new equilibrium point.

And farmers, who overlevered themselves to produce corn, crash and burn and the real estate bubble that popped in Vegas and Florida 3 years ago finally comes to Iowa.

So with the farm belt crashing, more will be imported from Brazil, until some bright lad in DC stands up and asks "why are we replacing imported oil with imported ethanol?", and the ethanol mandate goes away.

Steve

Print the post Back To Top
UnThreaded | Threaded | Whole Thread (4) | Ignore Thread Prev Thread | Next Thread
Advertisement