Scott Irwin, an agricultural economist at the University of Illinois at Urbana-Champaign (U of I), says that, although ethanol helped grain farmers post record profits in recent years, the looming recession’s impact on energy demand will hold income down.
“Energy demand has sagged amid a global economic meltdown, netting sharply lower prices for crude oil, gasoline and ethanol, a corn-based fuel additive,” Irwin said. “That, in turn, reduced the amount ethanol producers can pay for corn and still break even, pulling down the market for both corn and other grains that have ridden its coattails since the ethanol boom took hold in 2006.”
Irwin’s full report can be found in “Illinois Farm Economics Update,” a five-part package developed by U of I economists to guide farmers through the current economy.
