On this Deep Dive episode of FP Next, powered by John Deere, Curt and Sarah connect with Scott McPheeters of Gothenburg, Neb., where he shares all about his journey with ethanol on his farm.
Starting in November 2000, McPheeters joined a group of agricultural producers who invested $18 million to build farmer-owned ethanol plants. What began as a single 40-million-gallon facility in Minden, Nebraska, has expanded into multiple plants across several states.
“Ethanol is a key user of corn domestically,” McPheeters explains, even losing 5% of ethanol production would leave corn farmers in trouble. "Every 1% of ethanol that's included in the fuel, it uses 500 million bushels of corn. So if we went from E-15 to E-10, that's 2.3 billion bushels, and that's a lot.
California's recent approval of E15 represents a major breakthrough, as the nation's largest fuel market previously banned higher ethanol blends. However, McPheeters stresses that nationwide adoption is essential—every gallon matters, but California alone won't solve market challenges.
The industry faces ongoing obstacles from seasonal E15 restrictions based on outdated regulations claiming summer smog concerns, despite evidence showing environmental benefits.
McPheeters farms food and fuel grade corn on his farm, alongside his two sons, and he says that ethanol represents a massive economic input. Ethanol contributes $5-6 billion a year in Nebraska alone, bringing that money through rural communities.
One large discussion point surrounding ethanol is producers in the ethanol industry promoting the importance of this fuel in vehicles. "If we don't get octane from ethanol, where do we get it?” he asks. “Well, it has to come from petroleum, and they're expensive and they're more scarce, but it comes from terrible, terrible things that you would not want to come in contact with, like benzene, xylene and toluene."
Bottom line, the ethanol market is growing, bringing profits and new opportunities for producers. "The future is really bright if people can be given the right information,” McPheeters explains. “It's gone from less than a billion gallons of ethanol to almost 18 billion gallons."
Hear these insights and more about benefitting from ethanol on the latest episode of FP Next, powered by John Deere.