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Minn. ethanol plant to idle production

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An ethanol plant in southern Minnesota will temporarily shut down production because of high corn prices and surplus ethanol supplies.

Denver-based BioFuel Energy says it will idle its plant in Fairmont. It's the second facility in the state to shut down.

Last summer Central Minnesota Ethanol in Little Falls halted production.  BioFuel Energy last month reported a quarterly net loss of over $12 million. 

BioFuel Energy says the Fairmont plant, which produces 110 million gallons of ethanol per year, will remain idle until corn prices decline. A second ethanol plant in Nebraska will remain open.

In another ethanol development, Gevo will resume fuel production at its plant in Luverne. Gevo began producing isobutanol, another corn-based alcohol, at the facility earlier this year. But Gevo says it has run into some unspecified production problems and will temporarily go back to ethanol.

GEVO CEO Pat Gruber would not specify what the production problems are. Isobutanol is used both as fuel and as an industrial chemical.

"Temporarily running the plant in ethanol mode we can maximize cash flow versus trying to force isobutanol right now at these low production rates," Gruber said. "It also allows us to demonstrate the versatility of ethanol plants with Gevo technology to produce more than one product.  And that's important to our partners."