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Minnesota has 20 ethanol plants, many of which don’t report financial results publicly. Biofuel Benchmarking, which releases only combined results, reported that Minnesota ethanol makers had average net income of 43 cents per gallon in the fourth quarter, compared with a 2 cent-per-gallon loss a year ago. For the year, Minnesota producers’ average net income of 25 cents per gallon, compared with a 15-cent loss per gallon in 2012.
Larry Johnson, a Cologne, Minn., ethanol industry consultant, said the margins of the past quarter equate to a more than 20 percent return on investment. “That does make up for the zero return on investment for a couple of previous years,” he said.
Not all ethanol makers are seeing a boom. A plant in Buffalo Lake, Minn., remains closed after being sold in a bankruptcy case last year. Biofuel Energy Corp., former owner of the Fairmont plant, is out of the biofuel business after its lender sold off both of its production facilities.
Looking ahead, Johnson said, the industry probably won’t lose the entire battle over the ethanol blending mandate in 2014. Exports are up, and he expects corn production to be high this year.
“There’s a pretty solid sense of optimism in the industry,” Johnson added.
David Shaffer • 612-673-7090