BENTEK Energy, LLC, an energy markets information company, estimates that the US ethanol plant fleet has produced 1.9 billion gallons of ethanol through the first quarter of 2008. This outpaces last year’s production in the first quarter by 517 million gallons, or nearly 37%.
Average daily production through the first quarter of 2008 was approximately 21.4 million gallons per day, which compares to an average of 15.6 million gallons per day in the first quarter 2007 and an average of 17.8 million gallons per day for all of 2007.
BENTEK monitors the deliveries of natural gas from interstate pipelines to approximately 30% of all US ethanol facilities. This number is then modeled to monthly fuel ethanol output data provided by the US Energy Information Administration (EIA) to estimate a real-time daily US estimate of ethanol production based on gas inputs.
The US has approximately 134 ethanol plants in service in 2008 compared to 68 plants five years ago in 2003, with a production capacity of 7.229 million gallons per year (mgy), according to the Renewable Fuels Association (RFA). An additional 77 plans under construction or expanding could bring a potential additional capacity of 6.217 mgy onstream.
BENTEK projects that ethanol production in the US could exceed 7.7 billion gallons in 2008 if performance trends in the first quarter continue through the rest of the year. Total production of ethanol in 2007 was 6.485 billion gallons according to the RFA.
Last week, the US Department of Agriculture’s (USDA) Prospective Plantings report forecast an 8% decline in corn acres compared to last year to 86 million acres of corn—still the second-highest acreage intention since 1949.
The March USDA report indicates approximately 79 million harvested acres. If the average trend yield of 155.5 bushels per acre is realized, corn producers would be on track to produce approximately 12.3 billion bushels in 2008—the second-highest production ever, according to the RFA.
Most look at a scenario in the year 2015 where the American farmer will produce 15 billion bushels of corn, said Renewable Fuels Association spokesperson Matt Hartwig. If the ethanol industry can produce three gallons of ethanol per bushel, that will mean using about one third of that crop to make 15 billion gallons of ethanol as mandated by the Renewable Fuel Standard in the Energy Independence and Security Act of 2007 (EISA).