Free Republic

In September, ethanol giant VeraSun Energy opened a refinery on the outskirts of this eastern Iowa community. Among the largest biofuels facilities in the country, the Dyersville plant could process 39 million bushels of corn and produce 110 million gallons of ethanol annually. VeraSun boasted the plant could run 24 hours a day, seven days a week to meet the demand for home-grown energy. But the only thing happening 24-7 at the Dyersville plant these days is nothing at all. Its doors are shut and corn deliveries are turned away. Touring the facility recently, I saw dozens of rail cars...

According to a VeraSun press release, a “series of events” had shrunk its liquidity, impairing its ability to invest in production facilities and operate its business. “A dramatic spike in corn costs,” partly due to its hedging arrangements and “worsening capital market conditions and a tightening of trade credit resulted in severe constraints on the company’s liquidity position,” the release said The statement went on to say that the Sioux Falls, S.D.-based company said it planned to maintain operations while the company and 24 of its subsidiaries reorganize. In addition it expects to reach a deal with lenders on additional...