Ryan ThorpeChief Operating Officer

Tharaldson Ethanol

Tharaldson Ethanol

Tharaldson Ethanol

Energy and Security Act of 2007Also known as RFS2

Ethanol Mandate2011- 12.6 Billion Gallons2012- 13.2 Billion Gallons2013- 13.8 Billion Gallons2014- 14.4 Billion Gallons2015- 15 Billion Gallons

Ethanol Margins

EPA announcement 11-15-13

• EPA reduces 2014 total mandate from 18.15BB gallons to 15.21. This is made up of corn based ethanol, advanced biofuels, and biomass-based diesel

• Corn based ethanol cut from 14.4BB to 13.1BB gallons

• I will focus on corn based ethanol

Fallout from EPA announcement

• Long term-puts pressure on the future of corn based ethanol, limits its growth

• Leaves no room for cellulosic biofuel growth• Caps the ethanol penetration at 10%, reducing

the need to get E-15 at the pump, even though ethanol is currently $1 cheaper than gasoline

The real loser from this announcement

• The American Farmer!!!!!!!!!!!!!!• United States corn ending stocks for 2014 will

be the highest since 2005, 1.8BB bushels (prior to the ethanol boom)

• World ending corn stocks for 2014 will be the highest since 2001, 162MM tons (6.36BB bushels)

US Corn Ending Stocks

World Corn Ending Stocks

2014 Estimate US Corn

US Corn Ending Stocks vsStocks / Usage Ratio

0

250

500

750

1,000

1,250

1,500

1,750

2,000

2,250

2,500

92 94 96 98 00 02 04 06 08 10 12 14Est

En

din

g S

tock

s in

Mil

lio

n B

ush

els

0%

3%

6%

9%

12%

15%

18%

21%

24%

27%

Sto

cks / Usag

e Ratio

Ending Stocks Stocks as % of UsageUpdated: 09/12/2013 2014 = ADMIS Estimate

World Soybeans Ending Stocks

North Dakota Ethanol Production

• 2005- 30,000,000• 2008-128,935,229• 2011-383,574,864• 2012-365,093,524• 2013-367,145,656

Percentage of Ethanol Exported out of ND

• 2008-82%• 2011-93%• 2012-92.5%• 2013-92%

Questions????