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To: CommanderCricket who wrote (102795)	6/13/2008 2:30:43 PM
From: ChanceIs	Read Replies (1) \| Respond to of 206191

>>>Ethanol plants shut on record corn price<<< Damn. Got out of my ADM short way too soon.

To: CommanderCricket who wrote (102795)	6/13/2008 6:12:18 PM
From: elmatador	Read Replies (2) \| Respond to of 206191

"refiners can't go back to MTBE can they?" A return to MTBE could help gasoline prices, but it would also make refiners susceptible to the kind of environmental lawsuits that forced them to give up the additive in the first place. We Are ready to help the environment :-)

To: CommanderCricket who wrote (102795)	6/14/2008 8:54:45 AM
From: Dennis Roth	Read Replies (1) \| Respond to of 206191

US ethanol producers shutting in on corn price hike: Citi platts.com New York (Platts)--13Jun2008 Five US ethanol plants have recently shut on rising corn prices and "fairly massive shutdowns are in the offing," according to Citi analysts who this week downgraded ethanol stocks. In a report June 12, the Citi analysts cited a jump in corn prices to record levels above $7/bushel that has taken place in the wake of heavy Midwest rains. The US Department of Agriculture this week raised its corn price estimate for the 2008-2009 season and predicted US corn stocks may hit their lowest levels in more than a decade due to bad weather. The Citi report said ethanol margins have shrunk to just 4 cents/gal for ethanol plants with more than 100 million gal/year of capacity, down from 31 cents 11 days ago. Smaller plants have moved from break-even to a 45 cent/gal loss, according to the report. "As a result of the rapid margin deterioration we believe that many, if not all, of the small to midsize producers will be forced to shut down over the next few months with a total potential reduction in ethanol production at 2.0-5.0 [billion gal/year]," said Citi. They said five undisclosed mid to small ethanol producers have gone offline recently and more are expected to follow suit. "We estimate that there are 85 plants that are less than or equal to 50 million gallons," said the Citi report. "Total annual production from these 85 plants is approximately 2.9 billion gallons. There is also an additional 1.9 billion gallons of ethanol produced by plants that are between 50-65 mm gals (totaling 33 plants) that could also be at risk. Thus, we estimate that 2.0-5.0 billion gallons of ethanol capacity is at risk, representing 750-1,900 million bushels of annual corn demand." The analysts also expressed concern that record corn prices will fuel the food-versus-food debate and prompt US legislators to cap the Renewable Fuel Standard. "In our opinion, just the specter of possible political intervention will likely cause the market to question the magnitude of future biofuel growth, adding further pressure on valuations across the ethanol industry," said Citi. --Beth Evans, beth_evans@platts.com