People consistently exaggerate the value of ethanol in the American fuel mix, because they don't see how much petroleum needs to get burned to produce the ethanol. But Wall Street knows a mark when they see one, and so they're lining up the fools who have money to burn in sterile investments:
Ethanol production in the United States is growing so quickly that for the first time, farmers expect to sell as much corn this year to ethanol plants as they do overseas.
"It's the most stunning development in agricultural markets today - I can't think of anything else quite like this," says Keith Collins, the U.S. Agriculture Department's chief economist.
The amount of corn used for ethanol, estimated at 2.15 billion bushels this year, would amount to about 20 percent of the nation's entire crop, according to department projections.
Even as ethanol devours corn and pushes prices higher, the president and Congress are calling for even greater ethanol use. Wall Street cannot seem to get enough of ethanol-related investments. Automakers are speeding ethanol-capable vehicles onto the road.
Yet the ethanol industry is not without its critics, who question whether tax incentives provided by Congress are really needed.
The enthusiasm for ethanol makes farmer Lynn Phillips want to grow more corn. Phillips helped raise the money for the farmer-owned Tall Corn plant, which opened in 2002 as a way to make more money by processing every kernel of locally grown corn.
"We saw train cars after train cars of raw material being shipped away and value being added somewhere else," said Phillips. Now, the corn "is still going out on train cars - it's just going out in the form of ethanol and distillers' grain."
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