Morgan Stanley Says Policy Changes Won’t Hurt Ethanol Demand

Bloomberg BusinessWeek
By Whitney McFerron on August 07, 2012
Potential changes in a U.S. government mandate for ethanol are unlikely to “materially impact” demand for the gasoline additive made from corn, Morgan Stanley said.

Livestock producers and some U.S. lawmakers have asked President Barack Obama’s administration to cut a requirement that refiners use ethanol, after drought spurred corn prices to surge to a record last month. Blenders are unlikely to stop using ethanol even if the mandate is scrapped, because the fuel additive is trading at a discount to gasoline, Morgan Stanley analysts including Vincent Andrews and Hussein Allidina wrote in an e-mailed report today.

Read more