# Ethanol Plants Pushed Toward Unprofitability | Farm Bureau Intel Markets | American Farm Bureau Federation

> Iowa State's ethanol plant model shows returns over variable costs falling to negative 39 cents per gallon at a 90-cent ethanol price, down from negative 4 cents in January. The article attributes the squeeze to a 61% drop in May crude futures after the collapse of the Saudi-Russia supply agreement and COVID-19 demand losses.

- Date: 2020-03-25 · published 2020-03-25T12:00:00.000Z
- Category: macro · region US · magnitude medium
- Page: https://feedsoft.ai/events/54130-ethanol-plants-pushed-toward-unprofitability-farm-bureau-intel-markets-american
- Commodities: [Corn](https://feedsoft.ai/c/CORN.md), [Crude Oil (WTI)](https://feedsoft.ai/c/WTI.md)

## Why it matters

Unprofitable ethanol plants are likely to cut output, which reduces corn grind and DDGS production. The result is weaker demand for corn and lower co-product output, while crude weakness continues to pressure the fuel complex.

## Read by commodity

- WTI: bearish ▼
- CORN: bearish ▼

## Similar past events

| Commodity | Date | Event | 5-day % | 20-day % |
| --- | --- | --- | --- | --- |
| CORN | 2020-04-07 | [Coronavirus Sends Crop and Livestock Prices into a Tailspin \| Farm Bureau Intel Markets \| American Farm Bureau Federation](https://feedsoft.ai/events/5743-coronavirus-sends-crop-and-livestock-prices-into-a-tailspin-farm-bureau-intel.md) | -4.0% | -6.5% |
| CORN | 2020-03-30 | [Ethanol Market Is Disturbing to American Farmers. And Now There's Covid-19.](https://feedsoft.ai/events/54231-ethanol-market-is-disturbing-to-american-farmers-and-now-there-s-covid-19.md) | +3.6% | -5.7% |
| CORN | 2016-08-29 | [Fed impact on markets still in play](https://feedsoft.ai/events/10616-fed-impact-on-markets-still-in-play.md) | -0.6% | +1.8% |
| CORN | 2024-08-21 | [Farmers look to Washington for inflation pressure relief - Marketplace](https://feedsoft.ai/events/28773-farmers-look-to-washington-for-inflation-pressure-relief-marketplace.md) | -1.6% | +6.3% |
| CORN | 2021-02-22 | [US money markets bringing forward Fed rate hike bets to end-2022 - Markets - Business Recorder](https://feedsoft.ai/events/48546-us-money-markets-bringing-forward-fed-rate-hike-bets-to-end-2022-markets.md) | +1.6% | -3.4% |
| WTI | 2020-03-30 | [Ethanol Market Is Disturbing to American Farmers. And Now There's Covid-19.](https://feedsoft.ai/events/54231-ethanol-market-is-disturbing-to-american-farmers-and-now-there-s-covid-19.md) | +64.1% | -28.3% |
| WTI | 2020-03-27 | [Oil market volatility is at an all-time high -
		U.S. Energy Information Administration (EIA)](https://feedsoft.ai/events/9201-oil-market-volatility-is-at-an-all-time-high-u-s-energy-information.md) | +37.1% | -32.8% |
| WTI | 2019-08-01 | [Markets show disappointment in Fed position on future cuts - Mansfield Energy](https://feedsoft.ai/events/11290-markets-show-disappointment-in-fed-position-on-future-cuts-mansfield-energy.md) | -12.7% | -4.7% |

## Sources

- fb.org: https://www.fb.org/intel/markets/ethanol-plants-pushed-toward-unprofitability

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Data from Feedsoft AI (https://feedsoft.ai/). For information only; not investment advice.