Ethanol Facts: Agriculture
Feeding the World, Fueling a nation
Ethanol provides a vital value-added market for corn and other commodities, providing an economic boost to rural America. Demand created by ethanol production increases the price a farmer receives for grain.
FACT: Tremendous increases in the productivity of U.S. farmers have ensured ample supplies of grain are available for domestic and international use as food, feed and fuel. Over the past 20 years, the average corn yield has increased by 36%, from 109 bushels per acre in 1991 to an estimated 147 bushels per acre in 2011. Results from a study conducted by Informa Economics, Inc. projects the average corn yield to increase another 29% by 2020, to 189 bushels per acre. One-third of every bushel of grain processed into ethanol is enhanced and returned to the animal feed market in the form of distillers grains, corn gluten feed or corn gluten meal.
FACT: In 2012, ethanol production used 4.5 billion bushels of corn to produce 34.4 million metric tons of high quality livestock feed and 13.3 billion gallons of ethanol. This includes 31.6 million metric tons of distillers grains and 2.8 million tons of corn gluten feed and meal. That is considerably more feed production than the total output of grain used at beef feedlots across the nation. It's equivalent to more corn than is produced by any country except the U.S. In fact, it's enough livestock feed to provide every American with four quarter-pound hamburgers every week.
FACT: An estimated two-thirds of the nation's ethanol biorefinieries extract corn distillers oil during the ethanol and feed production process and sell that oil into the feed market, as well as biodiesel and other chemical markets.
FACT: By increasing the demand for corn, and thus raising corn prices, ethanol helps to lower federal farm program costs.
The fiscal cost of traditional counter-cyclical policies decreases with increasing market prices. Strong corn prices means producers receive no counter-cyclical payments (CCPs) or marketing loan benefits (MLBs) – the sum total of loan deficiency payments (LDPs), marketing loan gains, and certificate exchange gains.
FACT: A modern dry-mill ethanol refinery produces approximately 2.8 gallons of ethanol and 17 pounds of highly valuable feed co-products (distillers grains) from one bushel of corn.
FACT: The amount of agricultural land required to produce 15 billion gallons of grain ethanol in the U.S. by 2015, as required by the 2007 Energy Independence and Security Act (EISA), is likely to be less than 1% of total world cropland. Source: “Ethanol and a Changing Agricultural Landscape,” ERR-86, USDA-ERS (November 2009)
FACT: Ethanol production does not reduce the amount of food available for human consumption. Ethanol is produced from field corn fed to livestock, not sweet corn fed to humans. Importantly, ethanol production utilizes only the starch portion of the corn kernel, which is abundant and of low value. The remaining vitamins, minerals, protein and fiber are sold as high-value livestock feed. An increasing amount of ethanol is produced from nontraditional feedstocks such as waste products from the beverage, food and forestry industries. In the very near future we will also produce ethanol from agricultural residues such as rice straw, sugar cane bagasse and corn stover, municipal solid waste, and energy crops such as switchgrass.
U.S. ethanol production accounts for less than 3% of the world's grain supply on a net basis. That means more than 97% of all the grain produced in the world is available for other uses.
Last Updated March 2013
