Minnesota ethanol industry hit hard by COVID-19 in 2020 but still major economic contributor

In Minnesota, according to a new study by ABF Economics, Minnesota’s ethanol industry produced 956 million gallons of ethanol in 2020 (27 percent lower than 2019) as traffic volumes in the state plunged throughout the year.

Nonetheless, the industry still contributed $1.5 billion to Minnesota’s economy last year and supported nearly 14,500 jobs.

The drop in traffic volumes in Minnesota and the rest of the country in 2020 led to lower demand for ethanol, specifically in March and April when shelter-at-home orders were issued to curtail the spread of the COVID-19 virus.

This, in turn, saw ethanol demand fall 42 percent nationwide. As a consequence, ethanol plants in Minnesota temporarily cut or idled production.

The report said gross revenue for Minnesota’s ethanol industry was $4.4 billion in 2020, down from $6.7 billion in 2019.

Additionally, the industry contributed $964 million in household income and paid $131 million in state and local taxes in 2020.