Corn producers had high hopes going into 2012. Record harvests were predicted.
Then the weather dried up. The drought began before planting and never stopped. Even though more acres were planted in 2012 compared to 2011, 13 percent less corn was harvested.
Availability of locally produced corn is vital for ethanol plants since having it shipped in is too expensive. To make matters worse, the drought hit hardest in many of the top corn-growing states.
Six of the 20 ethanol plants that stopped production are in Nebraska, two in Indiana, and two in Minnesota. Ten states have seen one plant affected. Cooper said the 20 plants employ roughly 1,000 workers combined, but it wasn't known how many have been laid off.
Valero Energy Corp., idled three plants last year — in North Linden, Ind., and Albion, Neb., in June; and in Bloomingburg, Ohio, in December.
Five plants ceased production in January alone — Abengoa plants in the Nebraska towns of York and Ravenna; a White Energy plant in Plainview, Texas; an Aemetis facility in Keyes, Calif.; and POET Biorefining's mid-Missouri plant in Macon.
The production stoppages are cutting into ethanol production. The 770,000 gallons per day produced in the last full week of January were the fewest since the U.S. Energy Information Administration began tracking weekly data in June 2010.
That's not much of an issue for consumers, at least for now, because there are plenty of stockpiles of ethanol. Purdue University agriculture economist Chris Hurt said the nation has more than 20 million barrels of ethanol in stock, slightly more than a year ago, largely because Americans are driving less and driving more fuel-efficient cars. Cooper said, though, that stockpiles are expected to dwindle in the spring and summer as demand picks up and plants remain idled.
Hurt said the ethanol industry needs an end to the drought, a strong corn crop and a drop in corn prices. Corn futures were $5.51 a bushel in May, before the drought's impact took hold. Prices rose to a peak of $8.34 per bushel in August and were $7.46 per bushel last week.