On RFD-TV: Kate Brooks

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08/10/2022 Added

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As the second largest ethanol producer in the country, Nebraska produced over 2.25 billion gallons in 2019. A new University of Nebraska-Lincoln study shows the overall economic impact of the industry exceeded $4.5 billion that year. Associate professor of agricultural economics Kate Brooks discussed the study live on RFD-TV, August 9, 2022.

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[00:00:00.330]Nebraska continues to rank as the second largest ethanol producer in the US.
[00:00:05.610]According to a new study, the overall economic impact of the state's ethanol industry was more than $4.5
[00:00:11.070]billion in 2019.
[00:00:13.770]Ag economist with the University of Nebraska-Lincoln, Kate Brooks joins us now for a further look. A
[00:00:19.230]nd Kate, thank you very much for your time here this morning.
[00:00:21.600]If you would tell us just briefly about this report, what would you say are a couple of the highlights?
[00:00:27.630]Yeah, you know, we produce this report in partnership with the Nebraska Ethanol Board.
[00:00:32.670]This is actually the third report that we produce on the economic impacts of the ethanol and co-product
[00:00:37.680]industry in Nebraska.
[00:00:39.210]And so we can kind of look at some of the trends over time.
[00:00:41.000]One of the things we note that while the ethanol industry did experience some weakened ethanol prices in
[00:00:47.300]2018, and 2019, compared to some of those previous years, the ethanol industry in Nebraska continues to
[00:00:53.690]show resilience and some of that resilience comes through their expansion in their total capacity, as
[00:00:58.910]well as their diversification of some of their co-products beyond distillers grains into things such
[00:01:04.580]as corn oil, and carbon sequestration.
[00:01:07.370]Almost all of Nebraska's ethanol and about half of our state's distillers grain and corn oil that are produced
[00:01:12.920]here are actually exported, that helps him with that economic impact.
[00:01:17.510]This is a net positive impact for the state as sales outside of Nebraska represent that direct economic
[00:01:23.510]impact to the state by bringing new money into our economy.
[00:01:27.050]What impact is ethanol production specifically have on corn prices?
[00:01:31.970]Yeah, when we look at corn prices, there's a positive impact for local corn cash prices around the ethanol
[00:01:37.640]plant.
[00:01:38.240]On average, near an ethanol production facility, there's about a 21 cent per bushel increase in prices.
[00:01:44.450]We've worked on some other studies looking at these direct impacts on corn production to corn producers,
[00:01:50.630]and that ethanol increases the value of corn for corn producers near an ethanol plant.
[00:01:56.390]But we have to take transportation costs into factor there.
[00:01:59.540]So the further away we are from the plant, we might actually have a net smaller amount to those corn
[00:02:04.850]producers.
[00:02:05.930]And Kate, do you have any thoughts on the future of ethanol?
[00:02:10.340]Yeah, the ethanol industry again continues to grow.
[00:02:13.750]As we look over the last decade, we've seen increases in the capacity here in Nebraska, which increases the
[00:02:19.390]employment here in Nebraska. But when we look beyond production of ethanol, our producers have continued to
[00:02:25.480]diversify to take advantage of those new market opportunities.
[00:02:29.000]The coproduct industries continue to grow beyond those distillers grains and oils.
[00:02:34.070]And so I think the ethanol industry will continue to be a large driver of the economic impact of the state of
[00:02:39.470]Nebraska and in other corn producing states as well.
[00:02:42.000]Now right, well, thank you very much for your insight here this morning.
[00:02:45.810]University of Nebraska-Lincoln ag economist Kate Brooks connecting with us.
[00:02:50.130]Of course, you can go online to agecon.unl.edu for more information.

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