Large numbers of small to mid-size ethanol producers could shut down over the coming months after flooding across the US midwest caused irreparable damage to the year’s corn crop and pushed corn prices up sharply, says a report by Citigroup.

At least five small to mid-size ethanol plants had shut down in recent days, said David Driscoll, Citigroup’s US food manufacturing analyst, in an equity research report.

The widespread flooding, on a scale the region has seen only twice in the last 25 years, had forced down ethanol margins over the past 10 days, leaving small and mid-sized ethanol producers running at substantial losses against cash costs, Mr Driscoll said. ... Read full article