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Expanding Ethanol Industry Impacts Grain Transportation

More corn is moving short distances to ethanol plants rather than long distances for exports.

As the ethanol industry's demand for corn continues to increase, grain transportation may need to adjust to reflect the changes, the USDA's Transportation Services Branch reports.

More U.S. corn is expected to be used for ethanol than for exports in 2007/08, which means more corn would be moving short distances to nearby ethanol plants rather than being exported.

Rail grain loadings through May 5 were down 7.4% compared to the same period last year. Most corn going to distant feedlots and poultry producers travels by rail, but corn traveling short distances to ethanol plants usually goes by truck. Historically, corn makes up about half of railroad grain loadings.

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