ADM: Mostly ethanol gasoline unlikely

Tribune senior correspondent

Motor fuel made up mostly of ethanol is unlikely to catch on anytime soon, even as gasoline containing smaller amounts of the corn-derived product becomes ever more widely available, Archer Daniels Midland Co. executives said today.

The Decatur-based agribusiness giant foresees rapid growth in the market for gasoline blended with 10, 15 or even 20 percent concentrations of ethanol, but slower acceptance of so-called "E-85", its executives said at a conference with Wall Street analysts in Chicago Wednesday.

"Our big focus is on the blend market," said Ed Harjhausen, a senior vice president at ADM.

While acceptance of blended gasoline is improving, some 63 percent sold in the U.S. is unblended, which represents "enormous potential" for ADM to expand its market, he said. "We think the refining industry will just soak up the ethanol."

Still, the market for "E-85" motor fuel containing 85 percent ethanol and only 15 percent gasoline, remains in its "infancy," he said.

"Certain people in the petroleum industry are not going to embrace it." The best hope for expanding its distribution to consumers lies with independent fuel retailers who see "E-85" as a niche product giving them a competitive advantage over rival gas stations that refuse to carry it, he said.

ADM is the world's largest producer of ethanol.

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