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What 2023 Will Mean for Ethanol Margins

America’s ethanol industry saw its production margins get weaker late in 2022. MarketWatch says the ethanol industry outlook will depend on multiple factors. Margins have recently dropped below the same time last year.

Iowa State University’s Center for Agricultural and Rural Development says the average return over operating costs at a typical dry-mill ethanol plant was 34.64 cents per gallon. That’s over one dollar lower than the same time last year when the center put the average margin at $1.38 per gallon. The university says the average ethanol price in Iowa was at $2.44 a gallon, 85 cents lower year to year, while the average price of corn was $6.82 a bushel, about $1.10 higher than a year ago.

Some of the key issues for the U.S. ethanol industry to watch include Renewable Volume Obligations (RVOs), Carbon Capture Projects, the future of Small Refinery Exemptions, and fewer limits on E15 sales.

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