Capital costs in the Ethanol Industry

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Some information about capital costs in the ethanol industry is now available because the results of a recent USDA Cost of Production Survey are now available [4]. The capital cost and capacity data of the firms in this survey are used for a statistical estimate of the capital costcapacity relationship.

There are two technologies in the ethanol industry. Most existing dry mills are small, with capacities range of 5–30 million gallons per year (MGY). However, dry mills constructed during the current expansion are from 40 to 100MGY of capacity. Dry mills produce one composite byproduct; distillers dried grains (DDG) contains the residual protein, oil and fiber after the carbohydrate is removed for starch processing and ethanol production.

The wet mills of the United States tend to be larger. The capacity ranges from 50MGY and up

to 330MGY. Wet milling is a more complex technology; the byproduct is separated into corn gluten feed with about 20% protein, corn gluten meal with about 60% protein, and edible oil.

Many wet mills of the United States are also multifunctional, with a ...

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