Idled Ethanol Plants on Farmers’ Minds During Planting

Source: By AgWeb • Posted: Sunday, April 26, 2020

Many farmers are getting in the field this week since it may be one of the nicest yet this spring. According to USDA, Illinois farmers had 8% of the state’s corn crop planted as of April 19.

Jason Angus, a farmer in Piper City, Illinois is ready to be busy. He’s already planting, working up other ground, receiving seed corn, and tuning up the sprayer.

“After 2019, anything we can get done in April, we look at as a bonus right now,” Angus says.

At the same time, he and his wife Audrey are homeschooling their kids too.

“It’s a juggle, absolutely,” says Audrey Angus. “I’m used to working at home. That part is not different. I’m not used to them in the background and needing something constantly.”

It’s all a part of the ‘new normal’ as Jason gets ready to plant now that last week’s snow has melted.

“With good weather coming and dry field conditions, very few people will stop planting corn to switch over to soybeans if it’s going [into the soil] well in good conditions,” says Angus.

There’s more on his mind than just planting this spring. The Angus’ local ethanol plant is closed.

“Our overrun bushels, [the ones not marketed yet] become a challenge,” Jason says. “I’m just not sure without an increase in the crude oil market and an increase in demand from either ethanol or China to come in as a buyer, that we will see those Board of Trade prices rally to bring us to a profitable level.”

Crude oil futures prices did not show any relief early this week. The now-expired May contracted traded at a negative price for the first time in history. The June contract closed Monday at $20 dollars.

“It’s all about storage,” says Peter Meyer, head of grain and oilseed analytics with S&P Global Platts. “It’s the same issue we had with ethanol at the moment. There is just no storage left. Refineries are just shut down given the lack of demand and the lack of demand on the coronavirus front.”

Jason says the basis at his ethanol plant is the most attractive but not near to the level it was a month ago.

“It has affected the dried distillers grains market,” he says. “It has affected the basis levels at our local coops. Everything has widened out.”

As worries loom large for ethanol, prices and demand, all Jason and his crew can do is stay occupied. It’s not hard to do as the ready work continues ahead of hitting the field.

“The ground is in just really good condition for us right now,” he says. “Then, we will probably not stop.”

Jason’s rotation is made up of half corn and half soybean acres.