FTC: US ethanol market still unconcentrated

Nick Snow
OGJ Washington Editor

WASHINGTON, DC, Dec. 8 -- The US ethanol market is still unconcentrated, with 160 firms nationwide either producing the motor fuel additive or likely to be producing it in the next 18 months, according to the Federal Trade Commission in its sixth annual report.

The annual examination, which is required under the 2005 Energy Policy Act, found that there were the same number of US ethanol producers as of Sept. 30 as the federal antitrust regulator listed in its 2009 report.

It said the largest producer’s share of total US production capacity grew to 12% this year from 11% in 2008 and 2009, but remained below its 16% share from 2001 to 2007 and its 41% share in 2000. The Dec. 3 report did not identify the producer.

Ethanol production and production capacity both increased this year, the report said. US production increased 23% to 12.3 billion gal in 2010 from 10 billion gal in 2009, reaching a level more than 750% of what it was in 2000 when it was 1.6 billion gal, it said.

“Domestic ethanol production capacity, including capacity under construction, also rose from 14.5 billion annualized gal as of October 2009 to 15.2 billion gal as of October,” it continued. “Industry participants expect some of the expansion projects currently under way to come online by the end of 2010.”

The report said that while there is enough ethanol production capacity in existence and under construction to meet federal Renewable Fuel Standard requirements this year, additional capacity will be needed to meet future RFS mandates under the 2007 energy Independence and Security Act, including volume requirements for advance biofuels (defined as cellulosic ethanol and other biofuels derived from feedstocks other than corn starch).

It said that while there is no commercial-scale cellulosic ethanol production in operation today, investment in its research and development is continuing.

Contact Nick Snow at [email protected].