Quote:
Originally Posted by worthywads
How can ethanol take the equivalent of .74 gallons of gas to make but only cost $1.05?
I'd love to see a detailed cost breakdown from your ethanol plant, separating this cost.
Thanks
Steve
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I've seen this comment made in this discussion a couple of times now- people express incredulity at the cost of ethanol, given the amount of gas used to make it. I have a feeling that the answer isn't that less gas is actually used. I've said this a couple of times now but I think it bears repeating, because there are implications here that may not be clear to everybody. The government is HEAVILY subsidizing the production of corn in this country. This skews the price of corn. Which skews the price of everything made out of corn. The amount that things sell for may in some situations be less than it costs to make. Yes, that's stupid. It's certainly counterintuitive, perhaps even incredulous. But it's also possible in a system like this, with ridiculous and outsized subsidies intended to provide relief for poor farmers in very bad times, because the subsidies won't go away even when market conditions have drastically changed.