Ethanol Blog

NEW YORK (DTN) --- Archer Daniels Midland Company, the global agribusiness firm with its headquarters in Decatur, Ill., said earlier today it plans to reduce runs at two of its eight ethanol plants in the United States.

ADM Chief Operating Officer Juan Luciano announced the planned rate cuts during the company's earnings conference call this morning, and Schneider Electric again confirmed the plans with company spokesman David Weintraub a short while ago.

Details about the affected plants, including the size of the planned output cuts, would remain private, said Weintraub.

Weintraub said ADM has five wet mills and three dry mills with a total name plate capacity of 1.72 billion gallons a year.

ADM's announced action follows similar moves by rival producers, including Abengoa, POET and Valero, which also cut back plant runs or temporarily shut some of their plans due to low margins.

All together, 18 ethanol plants have been idled since last June as producers continue to incur losses, said Geoff Cooper, vice president for research at the Renewable Fuels Association.

A year ago, on Feb. 7, 2012, ADM announced plans to permanently close its 30-million-gallons-a-year ethanol plant in Walhalla, N.D., in April 2012, to help optimize its U.S. corn processing operations.

The company said at the time that the Walhalla facility was not delivering sufficient returns because its geographic location and scale made it difficult to compete in the marketplace.

After the closure of the Walhalla plant, ADM said continued to serve customers' needs through its operations in Cedar Rapids and Clinton, Iowa; Decatur and Peoria, Ill.; Columbus, Neb.; and Marshall, Minn.

George Orwel can be reached at george.orwel@telventdtn.com