Ethanol makers steer away from fuel, turn to booze

A U.S. glut of fuel-grade ethanol has major producers, including Green Plains Inc. and industry pioneer Archer Daniels Midland Co., pursuing other markets and idling excess capacity in an effort to rebuild sagging margins. ADM and Green Plains both said on Tuesday they are converting fuel-ethanol capacity into beverage and industrial alcohol production, as well as idling some mills. The announcements follow Pacific Ethanol's decision in June to buy a beverage-grade facility in Illinois, a diversification away from fuel ethanol. ADM said it was reconfiguring its Peoria, Ill., corn dry mill to produce more beverage and industrial alcohol. It will steer the plant's fuel to export markets, taking 100 million gallons of annual production out of the domestic market.