U.S. ethanol producers are beginning to diversify in an effort to boost profits as demand for their fuel drops, and they are looking to use corn in ingredients for products ranging from baked goods and nutrition bars to industrial coatings to fish food.
The Energy Information Administration has forecast that U.S. consumption of ethanol will rise less than 1 percent in 2013, to 12.9 billion gallons. Meanwhile, the $40 billion ethanol industry has seen its profits drop twice in four years. Ethanol makers were increasing profits by boosting production capacity to keep up with government requirements for billions of gallons of biofuels to be blended into motor fuel, but now supplies are up and demand is stagnating.
Poet LLC and Green Plains Renewable Energy Inc. are among the corn-based ethanol producers that are turning their facilities into refineries capable of creating specialized products alongside ethanol.