For farmers who grow corn, the ethanol industry’s growth starting in 2005 has been a game changer. When the Renewable Fuels Act went into place, corn had a new purpose aside from feeding people and livestock. It became important to the energy industry.
Louis Reed and his wife Terri farm near Castana, Iowa, and are members of Basin Electric Class C member Western Iowa Power Cooperative (WIPCO) in Denison, Iowa. Louis serves on WIPCO’s board and also as board chair at Northwest Iowa Power Cooperative, a Basin Electric Class A member in Le Mars.
“Ethanol has had a tremendous impact on corn farmers. The price is the obvious one,” Louis says. “This summer we had a positive basis of a dollar a bushel. We get the distillers grain back from an ethanol plant when we sell it, which is about a third of the volume. The plant takes the oil from the corn, and we get the distillers grain back to feed to our cattle, which is a lot better feed than corn.”
The Reeds sell to three ethanol plants, all within an hour drive of their farm: the Andersons Denison Ethanol plant in Denison, the POET Bioprocessing plant in Arthur, Iowa, and the CargillAg ethanol plant in Blair, Nebraska.
Louis says farmers today don’t have to transport their corn as far because the ethanol industry brought more local demand for their product. Also, ethanol has created high-paying jobs that keep young people in the area after school. “The ethanol is burned in our vehicles around here, and it helps support our local stores and our local farmers in many ways,” he says.