Low Crop Costs To Boost Ethanol Producers

Forbes.com
Melinda Peer, 09.11.09, 02:00 PM EDT

With huge harvests expected, meat and ethanol producers should get a break on input costs.

Flush harvest estimates from the United States Department of Agriculture were slightly higher than expected, weighing on crop prices Friday. However, analysts suspect increased ethanol production and frost fears could keep prices from falling too far.

Favorable late-summer weather throughout the U.S.' key growing regions will result in a record soybean crop and the second-largest corn crop, according to the USDA's latest global supply and demand estimates. The agency boosted its estimate for the year's corn crop by 2%, to nearly 13 billion bushels and just below the largest corn crop of 13.038 billion bushels in 2006. Soybean crop estimates were 1% higher at 3.3 billion bushels, surpassing 2006's record crop of 3.2 billion bushels.

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