Advisory Group Predicts More Ethanol Industry Consolidation This Year

Advisory Group Predicts More Ethanol Industry Consolidation This Year

A Los Angeles-based advisory group expects more ethanol industry consolidation this year. In a Biofuels International article, Ocean Park Advisors says with dampened expectations for future margins, they expect “any remaining non-strategic players to explore exits.” The report notes that 94 standalone ethanol plants in the United States account for 5.3 billion gallons or 35 percent of domestic production. Further, they predict boards of standalone plants will continue to weigh the benefits and risks of remaining independent in an industry that continues to consolidate. The finance advisory says it tracked ten transactions last year worth an estimated $750 million to $850 million that involved 13 plants with more than 800 million gallons-per-year production capacity.

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