POET bioprocessing facilities in Chancellor, S.D., Ashton, Iowa, and Coon Rapids, Iowa, will be idled and the start-up of a new plant in Shelbyville, Ind., will be delayed as producers across the United States continue to grapple with the economic fallout of the ongoing COVID-19 pandemic.
On an annualized basis, these operational changes are expected to reduce corn demand by 110 million bushels, freezing 330 million gallons of ethanol production across the four facilities. POET has also significantly slowed production at other facilities, further decreasing corn demand.
“Across the board, biofuel producers and our partners in the farm community face an unprecedented challenge,” said POET founder and CEO Jeff Broin. "Unfortunately, plummeting fuel demand amid the coronavirus pandemic has overwhelmed markets already suffering from continued trade barriers, a foreign price war over oil and regulatory uncertainty here at home.”
Broin said POET is working to ensure "that every biorefinery remains well-positioned to support a strong and swift recovery once daily life returns to normal."
Ethanol producers across the country are slashing production amid the ongoing crisis. Nationally, experts predict a decline in fuel demand of up to 55%. If these conditions persist, it will result in an annualized drop in ethanol demand of up to eight billion gallons or 2.7 billion bushels of corn.
“As always, we will continue monitoring the situation closely and working with team members at each plant to stay ahead of market changes as the situation continues to evolve day by day,” said POET president and Chief Operating Officer Jeff Lautt.