[ConservativeDude]

True.

But most ethanol is used domestically to meet blending mandates, correct?

[thackney]

U.S. Exports of Fuel Ethanol
http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=M_EPOOXE_EEX_NUS-Z00_MBBL&f=M

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Fortunately we stopped the subsidy that was used to export cheaper ethanol fuel.

Were U.S. Taxpayers Subsidizing Ethanol Exports?
http://www.energytrendsinsider.com/2012/03/06/ethanol-exports-future-of-ethanol-industry/

[outofsalt]

Ethanol is used to "save gas" by reducing consumption of pure gas. It is an additive that burns less efficiently than pure gas and you actually reduce mpg. though to a slightly lesser extent than the volume used by displacing the same amount of pure gas. In this sense it is not a blending agent such as they use for winter and summer formulations or to meet emissions limits.

The farmers like it because they sell corn to the distilleries rather than to the food (or whiskey) producers. Corn based food costs more since this is removed from the supply chain of grain available to make food.