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Published December 12, 2008, 12:00 AM

Ethanol fund may run out after this month

A state fund that helps North Dakota ethanol plants is expected to run out of money this month. Ethanol producers can tap into the fund when corn prices are high. Randy Schneider, president of the North Dakota Ethanol Producers Association, said that’s what happened in the third quarter of the year when corn sold for nearly $6 a bushel.

BISMARCK (AP) — A state fund that helps North Dakota ethanol plants is expected to run out of money this month.

Ethanol producers can tap into the fund when corn prices are high. Randy Schneider, president of the North Dakota Ethanol Producers Association, said that’s what happened in the third quarter of the year when corn sold for nearly $6 a bushel.

The fund has about $2.4 million. What’s left will be apportioned to Red Trail Energy, Blue Flint Ethanol and VeraSun Hankinson.

Producers are eligible for a maximum of $1.6 million a year and $10 million total. Money for the fund comes from farm vehicle registration fees and ag fuel refunds.

State Commerce Commissioner Shane Goettle said the Legislature created the fund in 2005 to help startup plants in a volatile industry.

“It’s enough to keep the plant open, but not enough for profit. It goes into effect when they’re getting squeezed between the price of corn and the price of ethanol,” Goettle said.

The biggest check, for about $950,000, is to go to VeraSun because it had the most production in July through September. The company’s Hankinson plant has been on line only since June. It was acquired by VeraSun in a merger with U.S. BioEnergy LLC before VeraSun filed for Chapter 11 debt restructuring this fall.

Blue Flint and Red Trail reached their cap payment of $1.6 million during the last fiscal year when they were the only plants getting payments. During a new fiscal year and with VeraSun also eligible, they will get between $700,000 and $800,000 for the quarter.

Corn prices for December are less than $3 a bushel. Schneider said he’s hopeful the future will improve.

“It gives me no pleasure to ever use that fund for any plant in North Dakota,” he said.

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