• Pressures on Fuel Ethanol Production Capacity

    Capacity to produce fuel ethanol from corn nearly tripled between January 2006 and January 2009. However, over the past 18 months, a combination of surplus production capacity, the decline of gasoline prices from their mid-2008 peak level, and high corn prices that boosted producers' input costs have resulted in a sharp decline in ethanol margins. The combination of economic pressures on capacity led some producers to idle plants, and in some cases, file for bankruptcy.