A record year for ethanol exports: U.S. Grains Council touts success around the world

WASHINGTON — Along with solid sales of U.S. corn and distillers grains, ethanol exports are on pace to break an all-time record.

Ryan LeGrand, president and CEO of the U.S. Grains Council, shared the exciting news at the Corn Congress in Washington, where farmer leaders convene to serve as state delegates to set policy and plan advocacy by the National Corn Growers Association.

“The United States is on pace to export about 1.7 billion gallons of ethanol this crop year, topping the previous record of 1.6 billion gallons set in 2018. This is a nearly 50% increase from last year,” LeGrand said.

“All of our top 10 ethanol export markets show significant gains year over year, with the exception of South Korea.

“Canada is on pace to import 615 million gallons this year and could eventually turn into our first billion-gallon market.”

However, Brazil has applied an 18% tariff on U.S. ethanol, which has taken away what was at one time the top export market.

“We appreciate NCGA’s efforts here in D.C. to help rectify that situation and get us back to free trade in ethanol with Brazil,” LeGrand said.

“We also need your help in convincing the EPA to classify corn starch ethanol as an advanced biofuel. This classification would help tremendously here in the U.S. and abroad, where we’re competing against Brazil sugarcane ethanol and the growing production of corn starch ethanol.

“It will be absolutely crucial as we look to develop a sustainable aviation fuel market using U.S. corn ethanol as an input.”

Corn Exports

Current corn exports are up 27% from the previous year, now sitting at about 1.6 billion bushels and on track to hit 2.2 billion bushels when the crop year wraps up at the end of August.

“Mexico is importing more yellow corn than they ever have from us, despite the president’s efforts to curtail the import of GMO corn,” said LeGrand, citing the decree by Mexican President Andrés Manuel López Obrador in 2020 to phase out genetically modified U.S.-grown corn.

LeGrand said it is crucial for the Office of the U.S. Trade Representative to win the dispute settlement case on Mexico’s anti-GMO decree and get white corn exports back on track. The final decision on that case is expected to be issued in November.

Distillers Grains

U.S. distillers grains exports are up 17% from last year, driven by strong gains in Mexico, Vietnam, South Korea, Indonesia and Canada.

“So, these numbers positively impact your operations and the U.S. ethanol industry,” LeGrand said. “They’re possible because of strong demand, trade policy efforts with small, medium and large markets and the market development that the U.S. Grains Council does in nearly 60 countries.

“It’s truly been a group effort. And we do what we can every day to fulfill our mission of developing markets, enabling trade and improving lives.”

That work is funded, first and foremost, by checkoff dollars, which are then combined with money from the Market Access Program and the Foreign Market Development Program in the farm bill.

“This year, our funding has been enhanced by a new program called the Regional Agricultural Promotion Program, or RAPP, funded through the Commodity Credit Corporation and administered through USDA’s Foreign Agricultural Service,” LeGrand said.

“It’s meant to help address trade challenges in developing regions of the world, like Africa, Latin America, the Middle East and Southeast Asia.”

New Funding

The U.S. Grains Council got notice in May that it received $17 million in RAPP funding to use in these markets.

“Half of those funds will focus on U.S. ethanol promotion, but we’re also using them to bolster feed grains programs that will pay dividends for many years to come,” LeGrand said.

“I truly believe that we have the RAPP program today thanks to your grassroots efforts. I know that in your visits to the Hill these past few years, you’ve pushed for additional funding for foreign market development — and your voices were heard.

“While we don’t have these funds baked into the farm bill, which is the ultimate goal, Congress and USDA saw the need to get this done and ultimately acted on your requests by developing the RAPP funding program.”

The U.S. Grains Council will also continue its work in mature markets such as Canada, Mexico, China, Japan and South Korea, LeGrand said.