AI AK

Ethanol AIb Return over Return

Natural Ethanol & Natural Other Total Breakev Grind variable over all
Date Ethanol DDGS Corn Gas Ethanol DDGS DDGS Corn Gas Variable Variable Fixed Total en Margin costs costs
 Ethanol Profitability
To navigate among the pages in this workbook, use the tabs at the bottom of the spreadsheet or the links in the text

Overview and Assumptions – Overview of the model, assumptions and data sources.
Economic Ethanol Facility Model – The economic model that computes the monthly costs, revenue and pro

Tables:
Costs and Returns – Monthly Results per Gallon of Ethanol
Costs and Returns – Monthly Results per Bushel of Corn

Charts:
Ethanol Input and Output Prices – Monthly corn, natural gas, ethanol and DDGS prices – 2005 to pre
Ethanol Revenue – Monthly ethanol and DDGS revenue – 2005 to present
Breakeven Purchase Cost for Corn and Sale Price for Ethanol – Monthly prices ethanol facility can p
ethanol just cover costs – 2005 to present.

Corn at Market Price -- the analysis is based on corn at its market price
Ethanol Costs – Monthly cost to produce ethanol per gallon (total and divided by category) – 2005 to
Ethanol Revenue, Costs and Profits – Monthly costs and returns per gallon – 2005 to present.
Grind Margin and Return Over Variable and Total Cost – Monthly return over grind margin, variable, t
Return on Equity – Monthly percent return on equity – 2005 to present.
Allocation of Ethanol Profits (losses) – Monthly distribution between the ethanol producer and the cor

Corn at Cost of Production -- the analysis is based on corn at its cost of production
Ethanol Costs – Monthly cost to produce ethanol per gallon with corn costs projected into the future –
Ethanol Revenue, Costs and Profit – Monthly costs and returns per gallon – 2005 to present.
Allocation of Ethanol Profits (losses) – Monthly distribution between the ethanol producer and the cor

Ag Decision Maker, D1-10 Ethanol Profitability

Author: Don Hofstrand

File updated: 04/05/2019

Next update: 05/15/2019

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 Overview and Assumptions of Ethanol Profitability
The profitability of ethanol production is extremely variable. Due to the volatile price nature of ethanol and corn, its major feedstock, ethanol
profitability can change rapidly from month to month. In addition, price variations of its co-product (distillers grains with solubles, DDGS) and its
energy source (natural gas) add to the variability of ethanol profits.

To track the profitability of corn ethanol production, an economic model of a typical Iowa corn ethanol plant was created. This is a 100 million
gallon facility with construction costs similar to plants built in 2007. The costs and efficiencies are believed to be typical of Iowa ethanol plants.
The prices of ethanol, DDGS, corn and natural gas are updated monthly to compute the current profitability of ethanol production.

Monthly price variables

1) Ethanol Price 1 – Ethanol daily price F.O.B. (Free on Board) the plant (converted into monthly average prices) at selected ethanol plants in Iowa as reported by USDA Ag Market News

2) Corn Price (No. 2 yellow) 1 – Spot bid daily corn price (converted into monthly average prices) at selected ethanol plants in Iowa as reported by USDA Ag Market News in the National

3) DDGS Price 1 – Distillers Grains with Solubles daily price F.O.B. the plant (converted into monthly average prices) at selected ethanol plants in Iowa as reported by USDA Ag Market N

4) Natural Gas Price – Monthly Iowa natural gas price for industrial users as reported by the Energy Information Administration (official energy statistics of the U.S. government).

Although these prices are representative of Iowa ethanol plants, they may not be representative of plants in other regions or states. In the
economic model the user can increase or decrease any of the price series by a fixed amount to represent a special situation. An adjustment in
a price series will be reflected in the analysis tables and graphs.

To show how this facility would have performed in the past, the monthly profitability time-series is started in January, 2005. Although this facility
would not have been in production at this time (built in 2007), it provides a perspective on how this facility would have performed historically.

Revenue, costs and net returns (profitability) are shown monthly per gallon of ethanol and per bushel of corn. Also, ethanol and corn price
breakeven levels are computed.

Major assumptions and characteristics of the ethanol plant model

1) Turnkey ethanol production facility
2) Facility built in 2007
3) Nameplate capacity of 100 million gallons
4) Facility construction cost (including working capital) of $1.97 per gallon of ethanol nameplate capacity
5) Lender finances 40 percent of the project
6) Equity financing of 60 percent of the project.
7) Plant operates at 110 percent of nameplate capacity
8) Conversion factor of 2.8 gallons of ethanol per bushel of corn
9) A bushel of corn produces 16.5 pounds of distillers grains
10) Carbon dioxide is vented (no local market)
11) Natural gas requirement of 30 cubic feet per gallon of ethanol
12) Typical input costs for an Iowa corn ethanol facility

Input coefficient adjustment. Although we believe the coefficients in this model are a good representation of a corn ethanol plant, the user has
the ability to change any of the input coefficients in the model to fit a special situation. A change in an input coefficient will be reflected in the
analysis tables and graphs.

The monthly profitability of this hypothetical plant is computed by using the monthly market prices for ethanol, corn, DDGS and natural gas.
Each month the analysis is updated with the previous month’s prices. All other variables are held constant throughout the analysis.

1
The USDA Ethanol report for Iowa began in October of 2006. Price data prior to Oct 2006 was created for ethanol, corn, and dried distillers grains. The
Omaha rack ethanol price, the USDA Interior Iowa Grain (corn) prices, and the Lawrenceburg, Indiana distillers grains price from the USDA Feed Grains
Database were used to create this series. The pre-Oct. 2006 series was created by comparing the post-Oct. 2006 Iowa Ethanol price series to these databases
prices and adjusting the pre-Oct. 2006 Iowa Ethanol series by these differences.

Ag Decision Maker, D1-10 Ethanol Profitability

Author: Don Hofstrand

File updated: 04/05/2019

Next update: 05/15/2019
 Economic Model of an Ethanol Production Facility
Place the cursor over cells with red triangles to read comments.
Assumptions (inputs) Output
The following inputs (boxes) can be changed & the changes will be
reflected in the analysis.
Facility Construction Annual Production and Resource Usage
Nameplate Capacity 100,000,000 gal./yr. Construction Cost
Organizational Costs $3,700,000 Total $211,247,000
EPC Contract $153,000,000 Equity $126,748,200
Land $1,000,000 Debt $84,498,800
Site Preparation $5,500,000 Per Gallon Nameplate Cap. $2.11
Construction Mgmt. & Per Gallon Operating Cap. $1.92
Procurement Fees $9,000,000 Per Bushel Operating Cap. $5.38
Engineering Expense $900,000 Depreciation $12,083,133 per year
Const. Contingency $3,600,000 Ethanol Production
Start-up Operating Costs Nameplate Capacity 100,000,000 gallons per year
& Loan Fees $3,300,000 Operating Capacity 110,000,000 gallons per year
Start-up Debt Interest $1,247,000 DDGS Production 333,929 tons per year
Working Capital $30,000,000 Corn Usage 39,285,714 bushels per year
Estimated Life 15 years Natural Gas Usage 3,300,000 1,000 cubic feet/year
Property Taxes $250,000 per yr. Electricity Usage 77,000,000 kilowatt hours/year
Electricity Cost $4,235,000 per year
Financing Water Usage 385,000,000 gallons per year
Percent Debt 40 % Water Cost $1,347,500 per year
Length of Loan 10 years Number of Employees 42 employees
Interest Rate 8.25 % Labor & Management Cost $4,184,000 per year
Interest Cost $6,971,151 per year
Efficiency Factors Enzyme Cost $3,685,000 per year
Ethanol 2.8 gal./bu. Yeast Cost $374,000 per year
Production 110 % capacity Chemicals Cost $3,564,000 per year
DDGS 17 lbs./bu. Denaturant Cost $5,126,000 per year
Natural Gas 30 cub. ft./gal. Repairs & Maintenance $2,750,000 per year
Electricity 0.7 KwH/gal. Transportation Cost $825,000 per year
Water 3.5 gal./gal. Other Costs $2,200,000 per year

Labor & Management Production Costs (gallon & bushel)

Number Salary Chemicals Cost per Gallon Cost per Bushel
Production 17 $75,000 Enzymes 3.35 ¢/gal. 9.38 ¢/bu.
Maintenance 7 $79,000 Yeasts 0.34 ¢/gal. 0.95 ¢/bu.
Laboratory 2 $88,000 Chemicals 3.24 ¢/gal. 9.07 ¢/bu.
Material Handlers 10 $38,000 Denaturants 4.66 ¢/gal. 13.05 ¢/bu.
Mgmt. & Administrative Staff 6 $100,000 Total Chemical Cost 11.59 ¢/gal. 32.45 ¢/bu.
Management & Professional Fees $700,000
Other Administrative Expenses $500,000 Other Direct Costs
Repairs & Maintenance 2.50 ¢/gal. 7.00 ¢/bu.
Prices Transportation 0.75 ¢/gal. 2.10 ¢/bu.
Electricity 5.500 ¢/KwH Water 1.23 ¢/gal. 3.43 ¢/bu.
Water 0.350 ¢/gal. Electricity 3.85 ¢/gal. 10.78 ¢/bu.
Other 2.00 ¢/gal. 5.60 ¢/bu.
Chemicals Total Other Costs 10.33 ¢/gal. 28.91 ¢/bu.
Enzymes 3.35 ¢/gal.
Yeasts 0.34 ¢/gal. Fixed Costs
Chemicals 3.24 ¢/gal. Depreciation 10.98 ¢/gal. 30.76 ¢/bu.
Denaturants 4.66 ¢/gal. Interest 6.34 ¢/gal. 17.74 ¢/bu.
Labor & Management 3.80 ¢/gal. 10.65 ¢/bu.
Other Direct Costs Property Taxes 0.23 ¢/gal. 0.64 ¢/bu.
Repairs & Maintenance 2.50 ¢/gal. Total Fixed Costs 21.35 ¢/gal. 59.79 ¢/bu.
Transportation 0.75 ¢/gal.
Other 2.00 ¢/gal. Total Costs (less corn & natural gas)
Total Variable Costs 21.92 ¢/gal. 61.36 ¢/bu.
Price Adjustments (+ or -) Total Variable & Fixed Costs 43.27 ¢/gal. 121.15 ¢/bu.
Ethanol $0.00 $/gal.
DDGS $0 $/ton
Corn $0.00 $/bu.
Natural Gas $0.00 $/1000
 Monthly Costs and Returns per Gallon of Ethanol Produced

Corn at Market Price

Prices Revenue per Gallon Cost per Gallon Net Return/Gal.
Month Ethanol DDGS Corn Natural Total Total Ethanol Over Over
and per per per Gas/1000 Ethanol Natural Other Total Variable Break- Grind Variable All
Year gallon* ton* bushel* cub. ft.*** Ethanol DDGS & DDGS Corn Gas Var. Var. Fixed & Fixed even Margin Costs Costs
Jan-05 $ 1.51 $ 68 $ 1.75 $ 8.17 $ 1.51 $ 0.21 $ 1.72 $ 0.62 $ 0.25 $ 0.22 $ 1.09 $ 0.21 $ 1.30 $ 1.09 $ 0.82 $ 0.63 $ 0.42
Feb-05 $ 1.37 $ 70 $ 1.78 $ 7.80 $ 1.37 $ 0.21 $ 1.59 $ 0.63 $ 0.23 $ 0.22 $ 1.09 $ 0.21 $ 1.30 $ 1.09 $ 0.68 $ 0.50 $ 0.29
Mar-05 $ 1.15 $ 71 $ 1.87 $ 8.09 $ 1.15 $ 0.21 $ 1.37 $ 0.67 $ 0.24 $ 0.22 $ 1.13 $ 0.21 $ 1.34 $ 1.13 $ 0.42 $ 0.24 $ 0.03
Apr-05 $ 1.06 $ 71 $ 1.83 $ 7.66 $ 1.06 $ 0.22 $ 1.27 $ 0.65 $ 0.23 $ 0.22 $ 1.10 $ 0.21 $ 1.32 $ 1.10 $ 0.35 $ 0.17 $ (0.04)
May-05 $ 1.06 $ 73 $ 1.83 $ 8.11 $ 1.06 $ 0.22 $ 1.28 $ 0.65 $ 0.24 $ 0.22 $ 1.11 $ 0.21 $ 1.33 $ 1.11 $ 0.34 $ 0.16 $ (0.05)
Jun-05 $ 1.25 $ 73 $ 1.87 $ 7.65 $ 1.25 $ 0.22 $ 1.47 $ 0.67 $ 0.23 $ 0.22 $ 1.12 $ 0.21 $ 1.33 $ 1.11 $ 0.54 $ 0.36 $ 0.14
Jul-05 $ 1.57 $ 77 $ 2.00 $ 7.92 $ 1.57 $ 0.23 $ 1.80 $ 0.71 $ 0.24 $ 0.22 $ 1.17 $ 0.21 $ 1.38 $ 1.15 $ 0.81 $ 0.63 $ 0.42
Aug-05 $ 1.82 $ 77 $ 1.75 $ 9.24 $ 1.82 $ 0.23 $ 2.06 $ 0.62 $ 0.28 $ 0.22 $ 1.12 $ 0.21 $ 1.33 $ 1.10 $ 1.12 $ 0.94 $ 0.72
Sep-05 $ 2.41 $ 75 $ 1.58 $ 10.27 $ 2.41 $ 0.23 $ 2.64 $ 0.56 $ 0.31 $ 0.22 $ 1.09 $ 0.21 $ 1.30 $ 1.08 $ 1.73 $ 1.55 $ 1.34
Oct-05 $ 2.18 $ 75 $ 1.48 $ 11.53 $ 2.18 $ 0.23 $ 2.40 $ 0.53 $ 0.35 $ 0.22 $ 1.10 $ 0.21 $ 1.31 $ 1.08 $ 1.49 $ 1.31 $ 1.09
Nov-05 $ 1.84 $ 75 $ 1.53 $ 12.18 $ 1.84 $ 0.23 $ 2.07 $ 0.55 $ 0.37 $ 0.22 $ 1.13 $ 0.21 $ 1.34 $ 1.12 $ 1.12 $ 0.94 $ 0.72
Dec-05 $ 1.75 $ 84 $ 1.71 $ 12.05 $ 1.75 $ 0.26 $ 2.01 $ 0.61 $ 0.36 $ 0.22 $ 1.19 $ 0.21 $ 1.41 $ 1.15 $ 1.00 $ 0.82 $ 0.60
Jan-06 $ 1.88 $ 88 $ 1.78 $ 10.95 $ 1.88 $ 0.27 $ 2.14 $ 0.64 $ 0.33 $ 0.22 $ 1.18 $ 0.21 $ 1.40 $ 1.13 $ 1.14 $ 0.96 $ 0.75
Feb-06 $ 2.22 $ 91 $ 1.89 $ 10.21 $ 2.22 $ 0.28 $ 2.50 $ 0.67 $ 0.31 $ 0.22 $ 1.20 $ 0.21 $ 1.41 $ 1.14 $ 1.48 $ 1.30 $ 1.08
Mar-06 $ 2.13 $ 91 $ 1.88 $ 9.20 $ 2.13 $ 0.28 $ 2.41 $ 0.67 $ 0.28 $ 0.22 $ 1.17 $ 0.21 $ 1.38 $ 1.10 $ 1.42 $ 1.24 $ 1.03
Apr-06 $ 2.16 $ 88 $ 1.99 $ 8.62 $ 2.16 $ 0.27 $ 2.43 $ 0.71 $ 0.26 $ 0.22 $ 1.19 $ 0.21 $ 1.40 $ 1.13 $ 1.42 $ 1.24 $ 1.03
May-06 $ 2.68 $ 84 $ 2.01 $ 8.00 $ 2.68 $ 0.25 $ 2.93 $ 0.72 $ 0.24 $ 0.22 $ 1.18 $ 0.21 $ 1.39 $ 1.14 $ 1.94 $ 1.76 $ 1.54
Jun-06 $ 3.15 $ 80 $ 1.94 $ 8.28 $ 3.15 $ 0.24 $ 3.40 $ 0.69 $ 0.25 $ 0.22 $ 1.16 $ 0.21 $ 1.37 $ 1.13 $ 2.42 $ 2.23 $ 2.02
Jul-06 $ 2.77 $ 78 $ 1.99 $ 6.83 $ 2.77 $ 0.24 $ 3.00 $ 0.71 $ 0.20 $ 0.22 $ 1.13 $ 0.21 $ 1.35 $ 1.11 $ 2.05 $ 1.87 $ 1.66
Aug-06 $ 2.40 $ 77 $ 1.91 $ 8.45 $ 2.40 $ 0.23 $ 2.63 $ 0.68 $ 0.25 $ 0.22 $ 1.16 $ 0.21 $ 1.37 $ 1.14 $ 1.65 $ 1.47 $ 1.26
Sep-06 $ 2.05 $ 72 $ 2.05 $ 7.83 $ 2.05 $ 0.22 $ 2.27 $ 0.73 $ 0.23 $ 0.22 $ 1.18 $ 0.21 $ 1.40 $ 1.18 $ 1.27 $ 1.09 $ 0.87
Oct-06 $ 1.90 $ 80 $ 2.66 $ 6.39 $ 1.90 $ 0.24 $ 2.14 $ 0.95 $ 0.19 $ 0.22 $ 1.36 $ 0.21 $ 1.57 $ 1.33 $ 0.96 $ 0.78 $ 0.57
Nov-06 $ 2.04 $ 106 $ 3.28 $ 7.26 $ 2.04 $ 0.32 $ 2.36 $ 1.17 $ 0.22 $ 0.22 $ 1.61 $ 0.21 $ 1.82 $ 1.50 $ 0.94 $ 0.76 $ 0.54
Dec-06 $ 2.23 $ 126 $ 3.43 $ 8.31 $ 2.23 $ 0.38 $ 2.61 $ 1.22 $ 0.25 $ 0.22 $ 1.69 $ 0.21 $ 1.91 $ 1.52 $ 1.10 $ 0.92 $ 0.71
Jan-07 $ 2.15 $ 128 $ 3.53 $ 8.87 $ 2.15 $ 0.39 $ 2.54 $ 1.26 $ 0.27 $ 0.22 $ 1.75 $ 0.21 $ 1.96 $ 1.57 $ 0.97 $ 0.79 $ 0.58
Feb-07 $ 1.90 $ 128 $ 3.84 $ 9.39 $ 1.90 $ 0.39 $ 2.29 $ 1.37 $ 0.28 $ 0.22 $ 1.87 $ 0.21 $ 2.09 $ 1.70 $ 0.60 $ 0.42 $ 0.20
Mar-07 $ 2.19 $ 129 $ 3.75 $ 9.28 $ 2.19 $ 0.39 $ 2.58 $ 1.34 $ 0.28 $ 0.22 $ 1.84 $ 0.21 $ 2.05 $ 1.66 $ 0.93 $ 0.75 $ 0.53
Apr-07 $ 2.16 $ 112 $ 3.33 $ 8.58 $ 2.16 $ 0.34 $ 2.50 $ 1.19 $ 0.26 $ 0.22 $ 1.67 $ 0.21 $ 1.88 $ 1.54 $ 1.02 $ 0.84 $ 0.62
May-07 $ 2.17 $ 102 $ 3.44 $ 8.00 $ 2.17 $ 0.31 $ 2.48 $ 1.23 $ 0.24 $ 0.22 $ 1.69 $ 0.21 $ 1.90 $ 1.59 $ 0.97 $ 0.79 $ 0.58
Jun-07 $ 2.09 $ 97 $ 3.65 $ 8.58 $ 2.09 $ 0.29 $ 2.38 $ 1.30 $ 0.26 $ 0.22 $ 1.78 $ 0.21 $ 1.99 $ 1.70 $ 0.78 $ 0.60 $ 0.39
Jul-07 $ 1.97 $ 94 $ 3.01 $ 8.61 $ 1.97 $ 0.28 $ 2.25 $ 1.08 $ 0.26 $ 0.22 $ 1.55 $ 0.21 $ 1.77 $ 1.48 $ 0.88 $ 0.70 $ 0.49
Aug-07 $ 1.86 $ 92 $ 3.07 $ 7.88 $ 1.86 $ 0.28 $ 2.14 $ 1.10 $ 0.24 $ 0.22 $ 1.55 $ 0.21 $ 1.76 $ 1.48 $ 0.77 $ 0.59 $ 0.38
Sep-07 $ 1.58 $ 100 $ 3.16 $ 7.48 $ 1.58 $ 0.30 $ 1.88 $ 1.13 $ 0.22 $ 0.22 $ 1.57 $ 0.21 $ 1.79 $ 1.48 $ 0.49 $ 0.31 $ 0.09
Oct-07 $ 1.52 $ 115 $ 3.19 $ 7.48 $ 1.52 $ 0.35 $ 1.87 $ 1.14 $ 0.22 $ 0.22 $ 1.58 $ 0.21 $ 1.80 $ 1.45 $ 0.47 $ 0.29 $ 0.07
Nov-07 $ 1.74 $ 135 $ 3.60 $ 8.53 $ 1.74 $ 0.41 $ 2.15 $ 1.28 $ 0.26 $ 0.22 $ 1.76 $ 0.21 $ 1.97 $ 1.56 $ 0.57 $ 0.39 $ 0.18
Dec-07 $ 1.94 $ 148 $ 4.02 $ 8.86 $ 1.94 $ 0.45 $ 2.39 $ 1.44 $ 0.27 $ 0.22 $ 1.92 $ 0.21 $ 2.13 $ 1.69 $ 0.65 $ 0.47 $ 0.26
Jan-08 $ 2.19 $ 176 $ 4.56 $ 8.74 $ 2.19 $ 0.53 $ 2.72 $ 1.63 $ 0.26 $ 0.22 $ 2.11 $ 0.21 $ 2.32 $ 1.79 $ 0.79 $ 0.61 $ 0.40
Feb-08 $ 2.13 $ 163 $ 4.91 $ 9.99 $ 2.13 $ 0.50 $ 2.62 $ 1.75 $ 0.30 $ 0.22 $ 2.27 $ 0.21 $ 2.48 $ 1.99 $ 0.53 $ 0.35 $ 0.14
Mar-08 $ 2.32 $ 161 $ 5.17 $ 10.06 $ 2.32 $ 0.49 $ 2.80 $ 1.85 $ 0.30 $ 0.22 $ 2.37 $ 0.21 $ 2.58 $ 2.09 $ 0.62 $ 0.44 $ 0.22
Apr-08 $ 2.46 $ 170 $ 5.59 $ 10.71 $ 2.46 $ 0.52 $ 2.97 $ 2.00 $ 0.32 $ 0.22 $ 2.54 $ 0.21 $ 2.75 $ 2.24 $ 0.61 $ 0.43 $ 0.22
May-08 $ 2.49 $ 174 $ 5.62 $ 10.89 $ 2.49 $ 0.53 $ 3.01 $ 2.01 $ 0.33 $ 0.22 $ 2.55 $ 0.21 $ 2.77 $ 2.24 $ 0.64 $ 0.46 $ 0.25
Jun-08 $ 2.54 $ 182 $ 6.45 $ 11.83 $ 2.54 $ 0.55 $ 3.09 $ 2.30 $ 0.35 $ 0.22 $ 2.88 $ 0.21 $ 3.09 $ 2.54 $ 0.39 $ 0.21 $ (0.00)
Jul-08 $ 2.64 $ 186 $ 5.92 $ 12.42 $ 2.64 $ 0.56 $ 3.21 $ 2.12 $ 0.37 $ 0.22 $ 2.71 $ 0.21 $ 2.92 $ 2.36 $ 0.68 $ 0.50 $ 0.29
Aug-08 $ 2.22 $ 155 $ 5.06 $ 11.83 $ 2.22 $ 0.47 $ 2.69 $ 1.81 $ 0.35 $ 0.22 $ 2.38 $ 0.21 $ 2.59 $ 2.13 $ 0.49 $ 0.31 $ 0.10
Sep-08 $ 2.15 $ 141 $ 5.11 $ 9.30 $ 2.15 $ 0.43 $ 2.58 $ 1.83 $ 0.28 $ 0.22 $ 2.32 $ 0.21 $ 2.54 $ 2.11 $ 0.44 $ 0.26 $ 0.04
Oct-08 $ 1.85 $ 130 $ 3.95 $ 7.30 $ 1.85 $ 0.39 $ 2.24 $ 1.41 $ 0.22 $ 0.22 $ 1.85 $ 0.21 $ 2.06 $ 1.67 $ 0.57 $ 0.39 $ 0.18
Nov-08 $ 1.65 $ 120 $ 3.57 $ 7.11 $ 1.65 $ 0.37 $ 2.01 $ 1.27 $ 0.21 $ 0.22 $ 1.71 $ 0.21 $ 1.92 $ 1.55 $ 0.49 $ 0.31 $ 0.09
Dec-08 $ 1.49 $ 116 $ 3.37 $ 7.92 $ 1.49 $ 0.35 $ 1.85 $ 1.20 $ 0.24 $ 0.22 $ 1.66 $ 0.21 $ 1.87 $ 1.52 $ 0.37 $ 0.19 $ (0.03)
 Monthly Ethanol Costs and Returns per Bushel of Cor

Corn at Market Price

Prices Revenue per Bushel Total Cost/Bu. Net Return/Bu. Return
Month Ethanol DDGS Corn Natural Total Corn Total Over Over on
and per per per Gas/1000 Ethanol Break- Total Variable Variable All Equity
Year gallon ton bushel cub. ft. Ethanol DDGS & DDGS even Variable & Fixed Costs Costs Annual
Jan-05 $ 1.51 $ 68 $ 1.75 $ 8.17 $ 4.24 $ 0.58 $ 4.82 $ 2.92 $ 3.04 $ 3.64 $ 1.78 $ 1.18 37%
Feb-05 $ 1.37 $ 70 $ 1.78 $ 7.80 $ 3.85 $ 0.60 $ 4.44 $ 2.58 $ 3.04 $ 3.64 $ 1.40 $ 0.80 25%
Mar-05 $ 1.15 $ 71 $ 1.87 $ 8.09 $ 3.23 $ 0.60 $ 3.83 $ 1.94 $ 3.16 $ 3.76 $ 0.67 $ 0.07 2%
Apr-05 $ 1.06 $ 71 $ 1.83 $ 7.66 $ 2.96 $ 0.60 $ 3.56 $ 1.71 $ 3.09 $ 3.69 $ 0.48 $ (0.12) -4%
May-05 $ 1.06 $ 73 $ 1.83 $ 8.11 $ 2.96 $ 0.62 $ 3.58 $ 1.69 $ 3.12 $ 3.72 $ 0.46 $ (0.14) -4%
Jun-05 $ 1.25 $ 73 $ 1.87 $ 7.65 $ 3.50 $ 0.62 $ 4.12 $ 2.27 $ 3.13 $ 3.72 $ 1.00 $ 0.40 12%
Jul-05 $ 1.57 $ 77 $ 2.00 $ 7.92 $ 4.39 $ 0.65 $ 5.04 $ 3.17 $ 3.28 $ 3.87 $ 1.77 $ 1.17 36%
Aug-05 $ 1.82 $ 77 $ 1.75 $ 9.24 $ 5.11 $ 0.65 $ 5.76 $ 3.77 $ 3.14 $ 3.73 $ 2.62 $ 2.02 63%
Sep-05 $ 2.41 $ 75 $ 1.58 $ 10.27 $ 6.76 $ 0.64 $ 7.39 $ 5.32 $ 3.05 $ 3.65 $ 4.34 $ 3.74 116%
Oct-05 $ 2.18 $ 75 $ 1.48 $ 11.53 $ 6.09 $ 0.64 $ 6.73 $ 4.55 $ 3.07 $ 3.66 $ 3.66 $ 3.06 95%
Nov-05 $ 1.84 $ 75 $ 1.53 $ 12.18 $ 5.15 $ 0.64 $ 5.79 $ 3.56 $ 3.17 $ 3.77 $ 2.62 $ 2.03 63%
Dec-05 $ 1.75 $ 84 $ 1.71 $ 12.05 $ 4.91 $ 0.72 $ 5.62 $ 3.40 $ 3.34 $ 3.94 $ 2.28 $ 1.69 52%
Jan-06 $ 1.88 $ 88 $ 1.78 $ 10.95 $ 5.25 $ 0.75 $ 6.00 $ 3.87 $ 3.32 $ 3.91 $ 2.69 $ 2.09 65%
Feb-06 $ 2.22 $ 91 $ 1.89 $ 10.21 $ 6.21 $ 0.78 $ 6.99 $ 4.92 $ 3.36 $ 3.96 $ 3.63 $ 3.03 94%
Mar-06 $ 2.13 $ 91 $ 1.88 $ 9.20 $ 5.97 $ 0.78 $ 6.74 $ 4.76 $ 3.27 $ 3.87 $ 3.48 $ 2.88 89%
Apr-06 $ 2.16 $ 88 $ 1.99 $ 8.62 $ 6.04 $ 0.75 $ 6.79 $ 4.86 $ 3.32 $ 3.92 $ 3.47 $ 2.87 89%
May-06 $ 2.68 $ 84 $ 2.01 $ 8.00 $ 7.50 $ 0.71 $ 8.21 $ 6.32 $ 3.29 $ 3.89 $ 4.91 $ 4.32 134%
Jun-06 $ 3.15 $ 80 $ 1.94 $ 8.28 $ 8.83 $ 0.68 $ 9.51 $ 7.60 $ 3.25 $ 3.85 $ 6.26 $ 5.66 175%
Jul-06 $ 2.77 $ 78 $ 1.99 $ 6.83 $ 7.74 $ 0.67 $ 8.41 $ 6.62 $ 3.18 $ 3.77 $ 5.23 $ 4.63 144%
Aug-06 $ 2.40 $ 77 $ 1.91 $ 8.45 $ 6.71 $ 0.65 $ 7.36 $ 5.44 $ 3.23 $ 3.83 $ 4.13 $ 3.53 109%
Sep-06 $ 2.05 $ 72 $ 2.05 $ 7.83 $ 5.75 $ 0.61 $ 6.36 $ 4.49 $ 3.32 $ 3.92 $ 3.04 $ 2.44 76%
Oct-06 $ 1.90 $ 80 $ 2.66 $ 6.39 $ 5.32 $ 0.68 $ 6.00 $ 4.25 $ 3.81 $ 4.40 $ 2.19 $ 1.59 49%
Nov-06 $ 2.04 $ 106 $ 3.28 $ 7.26 $ 5.71 $ 0.90 $ 6.62 $ 4.79 $ 4.50 $ 5.10 $ 2.11 $ 1.52 47%
Dec-06 $ 2.23 $ 126 $ 3.43 $ 8.31 $ 6.24 $ 1.07 $ 7.32 $ 5.41 $ 4.74 $ 5.34 $ 2.58 $ 1.98 61%
Jan-07 $ 2.15 $ 128 $ 3.53 $ 8.87 $ 6.02 $ 1.09 $ 7.11 $ 5.15 $ 4.89 $ 5.49 $ 2.22 $ 1.62 50%
Feb-07 $ 1.90 $ 128 $ 3.84 $ 9.39 $ 5.32 $ 1.08 $ 6.40 $ 4.40 $ 5.24 $ 5.84 $ 1.16 $ 0.57 18%
Mar-07 $ 2.19 $ 129 $ 3.75 $ 9.28 $ 6.13 $ 1.10 $ 7.23 $ 5.24 $ 5.14 $ 5.74 $ 2.09 $ 1.49 46%
Apr-07 $ 2.16 $ 112 $ 3.33 $ 8.58 $ 6.05 $ 0.96 $ 7.00 $ 5.07 $ 4.66 $ 5.26 $ 2.34 $ 1.74 54%
May-07 $ 2.17 $ 102 $ 3.44 $ 8.00 $ 6.08 $ 0.87 $ 6.94 $ 5.06 $ 4.73 $ 5.33 $ 2.22 $ 1.62 50%
Jun-07 $ 2.09 $ 97 $ 3.65 $ 8.58 $ 5.85 $ 0.82 $ 6.67 $ 4.74 $ 4.98 $ 5.58 $ 1.69 $ 1.09 34%
Jul-07 $ 1.97 $ 94 $ 3.01 $ 8.61 $ 5.52 $ 0.80 $ 6.31 $ 4.38 $ 4.35 $ 4.95 $ 1.96 $ 1.37 42%
Aug-07 $ 1.86 $ 92 $ 3.07 $ 7.88 $ 5.21 $ 0.79 $ 5.99 $ 4.12 $ 4.34 $ 4.94 $ 1.65 $ 1.05 33%
Sep-07 $ 1.58 $ 100 $ 3.16 $ 7.48 $ 4.42 $ 0.85 $ 5.26 $ 3.43 $ 4.40 $ 5.00 $ 0.86 $ 0.26 8%
Oct-07 $ 1.52 $ 115 $ 3.19 $ 7.48 $ 4.27 $ 0.98 $ 5.24 $ 3.40 $ 4.44 $ 5.03 $ 0.80 $ 0.21 6%
Nov-07 $ 1.74 $ 135 $ 3.60 $ 8.53 $ 4.87 $ 1.15 $ 6.02 $ 4.09 $ 4.93 $ 5.52 $ 1.10 $ 0.50 15%
Dec-07 $ 1.94 $ 148 $ 4.02 $ 8.86 $ 5.44 $ 1.26 $ 6.70 $ 4.74 $ 5.38 $ 5.98 $ 1.32 $ 0.72 22%
Jan-08 $ 2.19 $ 176 $ 4.56 $ 8.74 $ 6.13 $ 1.49 $ 7.62 $ 5.68 $ 5.91 $ 6.51 $ 1.72 $ 1.12 35%
Feb-08 $ 2.13 $ 163 $ 4.91 $ 9.99 $ 5.95 $ 1.39 $ 7.34 $ 5.29 $ 6.36 $ 6.96 $ 0.98 $ 0.38 12%
Mar-08 $ 2.32 $ 161 $ 5.17 $ 10.06 $ 6.48 $ 1.37 $ 7.85 $ 5.80 $ 6.63 $ 7.23 $ 1.22 $ 0.62 19%
Apr-08 $ 2.46 $ 170 $ 5.59 $ 10.71 $ 6.87 $ 1.44 $ 8.32 $ 6.21 $ 7.10 $ 7.70 $ 1.21 $ 0.62 19%
May-08 $ 2.49 $ 174 $ 5.62 $ 10.89 $ 6.96 $ 1.48 $ 8.43 $ 6.31 $ 7.15 $ 7.74 $ 1.29 $ 0.69 21%
Jun-08 $ 2.54 $ 182 $ 6.45 $ 11.83 $ 7.10 $ 1.55 $ 8.65 $ 6.44 $ 8.06 $ 8.65 $ 0.59 $ (0.01) 0%
Jul-08 $ 2.64 $ 186 $ 5.92 $ 12.42 $ 7.40 $ 1.58 $ 8.98 $ 6.72 $ 7.58 $ 8.18 $ 1.40 $ 0.80 25%
Aug-08 $ 2.22 $ 155 $ 5.06 $ 11.83 $ 6.23 $ 1.31 $ 7.54 $ 5.34 $ 6.67 $ 7.27 $ 0.87 $ 0.28 9%
Sep-08 $ 2.15 $ 141 $ 5.11 $ 9.30 $ 6.02 $ 1.20 $ 7.22 $ 5.23 $ 6.51 $ 7.10 $ 0.71 $ 0.12 4%
Oct-08 $ 1.85 $ 130 $ 3.95 $ 7.30 $ 5.18 $ 1.10 $ 6.28 $ 4.46 $ 5.18 $ 5.78 $ 1.10 $ 0.50 16%
Nov-08 $ 1.65 $ 120 $ 3.57 $ 7.11 $ 4.61 $ 1.02 $ 5.63 $ 3.82 $ 4.78 $ 5.37 $ 0.86 $ 0.26 8%
Dec-08 $ 1.49 $ 116 $ 3.37 $ 7.92 $ 4.18 $ 0.99 $ 5.17 $ 3.29 $ 4.64 $ 5.24 $ 0.52 $ (0.07) -2%
Charts:
Ethanol Input and Output Prices – Monthly corn, natural gas, ethanol and DDGS prices – 2005 to present.
Ethanol Revenue – Monthly ethanol and DDGS revenue – 2005 to present
Breakeven Purchase Cost for Corn and Sale Price for Ethanol – Monthly prices ethanol facility can pay for corn and receive for
ethanol just cover costs – 2005 to present.

Corn at Market Price -- the analysis is based on corn at its market price
Ethanol Costs – Monthly cost to produce ethanol per gallon (total and divided by category) – 2005 to present.
Ethanol Revenue, Costs and Profits – Monthly costs and returns per gallon – 2005 to present.
Grind Margin and Return Over Variable and Total Cost – Monthly return over grind margin, variable, total costs – 2005 to present.
Return on Equity – Monthly percent return on equity – 2005 to present.
Allocation of Ethanol Profits (losses) – Monthly distribution between the ethanol producer and the corn farmer – 2005 to present.

Corn at Cost of Production -- the analysis is based on corn at its cost of production
Ethanol Costs – Monthly cost to produce ethanol per gallon with corn costs projected into the future – 2005 to present.
Ethanol Revenue, Costs and Profit – Monthly costs and returns per gallon – 2005 to present.
Allocation of Ethanol Profits (losses) – Monthly distribution between the ethanol producer and the corn farmer – 2005 to present.
 Total Revenue of Ethanol Production
$4.00

$3.50
$ per gallon

$3.00

$2.50

$2.00

$1.50

$1.00

$0.50

$-

-13 -13 -13 -14 -14 -14 -15 -15 -15 -16 -16 -16 -17 -17 -17 -18 -18 -18 -19
n y p n y p n y p n y p n y p n y p n
Ja Ma Se Ja Ma Se Ja Ma Se Ja Ma Se Ja Ma Se Ja Ma Se Ja
Source: USDA AMS Iowa Ethanol Report

DDGS Revenue Ethanol Revenue

 $ p e r g a llo n Ethanol Sale Price and Ethanol Breakeven Sale Price
(Ethanol Breakeven = Total Cost less DDGS Returns)
$3.00
$2.50
$2.00
$1.50
$1.00
$0.50
$-

Sour c e: USDA AMS Iowa Ethanol Report

Ethanol Sale Price

Source: USDA Ethanol Report

$ per bushel

Corn Sale Price and Corn Breakeven Sale Price

(Corn Breakeven = Total Revenue less All Costs-except Corn)
$10.00
$8.00
$6.00
$4.00
$2.00
$-

Source: Iowa Ethanol Report Corn Breakeven Sale Price

 Cost of Ethanol Production
(corn cost at corn market price)
$3.50
$ per gallon

$3.00

$2.50

$2.00

$1.50

$1.00

$0.50

$-
-13 -13 -13 -14 -14 -14 -15 -15 -15 -16 -16 -16 -17 -17 -17 -18 -18 -18 -19
n y p n y p n y p n y p n y p n y p n
Ja Ma Se Ja Ma Se Ja Ma Se Ja Ma Se Ja Ma Se Ja Ma Se Ja

Fixed
Source: USDA AMS Iowa Ethanol Costs
Report, EIA Other Variable Natural Gas Corn
 Ethanol Production Revenue,
Costs, and Profit
$4.00 (corn cost at corn market price)

$3.50
$ per gallon

$3.00

$2.50

$2.00

$1.50

$1.00
 Ethanol Production Revenue,
Costs, and Profit
$4.00 (corn cost at corn market price)

$3.50
$ per gallon

$3.00

$2.50

$2.00

$1.50

$1.00

$0.50

$-
-13 -13 -13 -14 -14 -14 -15 -15 -15 -16 -16 -16 -17 -17 -17 -18 -18 -18 -19
n
$(0.50) y p n y p n y p n y p n y p n y p n
Ja Ma Se Ja Ma Se Ja Ma Se Ja Ma Se Ja Ma Se Ja Ma Se Ja
Source: USDA AMS Iowa Ethanol Report, EIA

Total Cost per Gallon Revenue per Gallon Net Return/Gal.

 Ethanol Production Grind Margin and
Return Over Variable and Total Cost
$1.60

$1.40
$ per gallon

$1.20

$1.00

$0.80

$0.60

$0.40

$0.20

$-

-13 -13 -13 -14 -14 -14 -15 -15 -15 -16 -16 -16 -17 -17 -17 -18 -18 -18 -19
$(0.20)
n y p n y p n y p n y p n y p n y p n
Ja Ma Se Ja Ma Se Ja Ma Se Ja Ma Se Ja Ma Se Ja Ma Se Ja
$(0.40)

Return
Source: USDA AMS Iowa Ethanol Report, EIA Over Total Cost Return Over Variable Cost
 E t h a n o l $ P e r G a llo n

D D G S P r ic e P e r T o n
Monthly Output Prices
(Iowa Ethanol and DDGS Prices)
$3.00 $300
$2.50 $250
$2.00 $200
$1.50 $150
$1.00 $100
$0.50 $50
C o rn $ P e r B u s h e l

$- $-

P e r C u b ic F o o t
Source: USDA AMS Iowa Ethanol Report Ethanol price per gallon DDGS price per ton

Monthly Input Prices

(Iowa Corn and Natural Gas Prices)
$8.00 $10.00

$6.00 $8.00
$6.00
$4.00
$4.00
$2.00 $2.00
$- $-

Source: USDA AMS Iowa Ethanol Report, EIA Cor n pr ice per bushel N at ural Gas price per Cubic Foot

Source: USDA Iowa Ethanol Report, Energy

Information Administration Natural Gas Report
 Allocation of Ethanol Supply Chain Profits between
Ethanol Producer and Corn Farmer

$ per bushel

Corn Production Input Costs Cropland Cash Rent

Ethanol breakeven corn purchase price Ethanol Cost (not including corn)
Ethanol Revenue Corn Price
Landowner
Source: USDA AMS Breakeven
Iowa Ethanol Report, ISU Ethanol Profitability, ISU Estimated CostsCash
of CropRenter
ProductionFarmer Breakeven Corn Selling Price
Ethanol Breakeven Corn Purchase Price
 Percent Return on Equity
of Ethanol Production
(annualized basis)
180%

160%

140%

120%

100%

80%

60%

40%

20%

0%

-20%

-40%
Source: USDA AMS Iowa Ethanol Report
 Cost to Produce Ethanol
(corn at cost of production)
$3.00
$ per gallon

$2.50

$2.00

$1.50

$1.00

$0.50

$-
0 1 1 2 3 4 4 5 6 7 7 8
-05 -05 l-06 -07 -08 -08 l-09 r-1 -1 t-1 l-1 r-1 -1 t-1 l-1 r-1 -1 t-1 l-1
an ct u
J pr an ct Ju Ap an c Ju Ap an c Ju Ap an c Ju
J O A J O J O J O J O
Ethanol Fixed Costs Ethanol Variable Costs
Natural Gas Corn Input Costs Less Govt Payments
Source: USDA AMS Iowa Ethanol Report, ISU Ethanol Profitability, ISU Estimated Costs of Crop Production, EIA
Cropland Rent
 Natural Gas Corn Input Costs Less Govt Payments
Source: USDA AMS Iowa Ethanol Report, ISU Ethanol Profitability, ISU Estimated Costs of Crop Production, EIA
Cropland Rent
 Ethanol Production Revenue,
Costs, and Profit
(corn at cost of production)
$4.00
$ per gallon

$3.50

$3.00

$2.50

$2.00

$1.50

$1.00

$0.50

$-

$(0.50) -13 -13 -13 -14 -14 -14 -15 -15 -15 -16 -16 -16 -17 -17 -17 -18 -18 -18 -19
n y p n y p n y p n y p n y p n y p n
Ja Ma Se Ja Ma Se Ja Ma Se Ja Ma Se Ja Ma Se Ja Ma Se Ja
$(1.00)

Cost per
Source: USDA AMS Iowa Ethanol Report, ISU Ethanol Profitability, EIA Gallon Revenue per Gallon
 Allocation of Ethanol Supply Chain Profits between
Ethanol Producer and Corn Farmer
(corn at cost of production)
$1.20
$ per gallon

$1.00

$0.80

$0.60

$0.40

$0.20

$-

$(0.20)

$(0.40)

$(0.60)

TotalProfitability,
Source: USDA AMS Iowa Ethanol Report, ISU Ethanol Profits Corn
ISU Estimated Costs of Crop Production, EIA Farmer Profits
 0
0
0
0
0

00
00
00
00

Foot
0.00
P e r C u b ic F o o t D D G S P r ic e P e r T o n
ts between
mer

Selling Price
 8
-1
 -19
an
ween