The U.S ethanol industry is on track to post record numbers in 2025, which is driven by new trade agreements and emerging overseas demands. David Zimmerman, CEO of Big River Resources, explains that despite the demand for corn being historically flat, ethanol has been the main driver for increased corn consumption.
“In years like this, when corn gets very cheap, we do see an increase in export interest in buying corn. Unfortunately, the only time we get these big export values or big export totals is when corn is cheap,” says Zimmerman. “Now, ethanol demand is inelastic. We’re buying the same amount of corn every month, every year, so the valuation of that corn is something we just deal with.”
Recent trade deals have also helped increase demand for US ethanol.
“We’ve got a really good trade deal in place with the United Kingdom now that that wasn’t in place before. We are seeing Vietnam come to the table and be a potential consumer,” says Zimmerman. “The EU, there was a trade deal done there recently that dropped some value-added taxes. We still have the EU sensitivity to GMO to get over, and the devil will be in the details there, but I think it’s something that can be navigated for sure.”
Overall, Zimmerman says his outlook for ethanol over the next five to ten years remains bullish.
