ADM to idle two ethanol plants in Iowa, Nebraska

Houston — ADM is idling two ethanol plants in the US Midwest with a combined annual capacity of 575 million gallons, the company said Thursday, due to shrinking demand related to the coronavirous pandemic.

The plants to be shut are in Cedar Rapids, Iowa, and Columbus, Nebraska, ADM said in a statement. The plants' employees will be furloughed for four months, unless market conditions change, it said.

The US ethanol industry has been hammered the last two months, as the pandemic has forced residents to shelter-in-place and curtail driving.

Motor gasoline demand has plummeted in recent weeks, and demand for its blendstocks such as ethanol has followed suit.

Ethanol prices have fallen more than 50% from the highs in November.

The industry has responded by shutting down or reducing production at several plants. The Renewable Fuel Association last week released a study that showed more than 70 plants have been idled and another 70 have reduced production.

Accoring to US Energy Information Administration data, ethanol production fell to 563,000 b/d, the lowest level since the agency began tracking such data. Stocks, however, remain at record highs.