Watertown, SD -- Billions of gallons of ethanol production could be lost in the United States following what has been called the perfect storm of trade tariffs with China, refinery waivers, and now the Corona Virus. It's estimated the impact of the Corona Virus to farm country is significant and magnified with the waivers and tariffs. Jim Seurer, who is the CEO of Watertown based Glacial Lakes Energy says making matters worse is the drop in product use by states that use the renewable fuel. He says the days of solid margins for the ethanol industry ended two years ago after those margins dropped from about 50 cents a gallon to 20 cents today. He says the large drop has made it impossible to cover fixed costs.
Seurer says problems began two years ago for the ethanol industry, even before the Corona Virus was a household name.
He said the problem then moved to the export side.
If you take that out Seurer says it shows they did generate a little cash this year,which allowed them to pay out a five million dollar dividend to their coop members earlier in the year. When any part of the ethanol industry hurts, he says, they all hurt. So far they have been able to move product but everything is day-to-day. In the meantime distillers grain, a byproduct of ethanol, is in high demand.
As an aside, Seurer said they've been approached by health providers to make a hand sanitizer.
Seurer joined the GLE team as the Chief Finance Officer in 2007 and then assumed the Chief Executive Officer responsibilities in late 2008. Glacial Lakes Energy has two plants in Aberdeen as well as plants at Huron and Watertown.