Dependency on the Ethanol Industry

Yonas Hamda and Jing Li ()
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Jing Li: South Dakota State University

No 2008503, Issue Briefs from South Dakota State University, Department of Economics

Abstract: The year 2008 will long be remembered as a year when corn based ethanol has seen tremendous change. The Energy Independence and Security Act, which passed in late 2007, gave a huge boost to the industry as it mandated an increase in biofuel production and use. In 2008, the industry witnessed record high prices on corn and crude oil. Ultimately, a big ethanol and distiller’s grain company--Vera Sun Energy-- filed for Chapter 11 bankruptcy leaving farmers with contracts wondering what will happen next. South Dakota is a major corn growing and ethanol producing state and this article assesses the relative magnitude of corn based ethanol on the local economy in terms of distribution of ethanol plants and corn disappearance ratios.

Keywords: ethanol; south dakota; farm policy (search for similar items in EconPapers)
JEL-codes: Q18 Q13 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-agr and nep-ene
Date: 2008-12

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Persistent link: http://EconPapers.repec.org/RePEc:sda:ibrief:2008503

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