The CBOT corn crush
The crush refers to the process of refining a feedstock, such as corn, into fuel ethanol. While costs
vary, corn is the principal input cost, representing approximately 70 percent of the per gallon cost
of creating ethanol.
The CBOT corn crush measures the difference between the sales value of
finished fuel ethanol and the price of corn. Because ethanol is traded in dollars per gallon and corn
in cents per bushel, a conversion of prices into equal units is necessary.
One bushel of corn yields
approximately 2.8 gallons of ethanol and two major bi-products, distillers dried grains (DDGs) and
Therefore, the price of ethanol must be multiplied by 2.8 in order to convert it into a
price per bushel to corn.
The price of corn is then subtracted from the converted price of ethanol (in
dollars per bushel) to obtain the corn crush.
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