LINCOLN, NE – Biofuel producers reported strong earnings for last year’s final quarter, attributing the gains to lower corn prices, strong exports, and a strong demand for corn oil and livestock feed meal, the Journal Star reports.

It’s a dramatic turnaround from 2012, when drought forced corn prices above $8 a bushel, squeezing profits and leaving many ethanol plants struggling for survival.

Brazil, which is one of the biggest importers of U.S. ethanol, is also a big competitor, though it is sending its sugar cane-based ethanol to Europe.

“The European Union has just continued for one year some trade barriers to U.S. ethanol. So that is driving what I think is an inefficient process in world trade," said Nebraska Ethanol Board Administrator Todd Sneller.

Sneller said the rising profits are a bright spot for an industry in the middle of a battle over an EPA proposal to reduce mandates on biofuel production and blending.

Chuck Hofland, general manager of Siouxland Ethanol plant in Jackson, Nebraska, said the high-priced corn bought in 2012 and used to make ethanol in 2013 forced the industry to “discipline” itself.

“The lack of supply of corn means you produce a little less ethanol, which created value in the ethanol because there is a little shorter supply than we thought there might be,” Hofland said.

Hofland said profit margins are stronger than expected in 2014, as logistical transportation issues have kept the market from being flooded with cheap ethanol. Additional, while the price of corn oil has remained flat, distillers grain, which comprises livestock feed, has begun to offset a larger percentage of costs.

“Today a ton of distiller’s grain has about 120% the value of a ton of corn,” Hofland said. “You’re getting an improved feed quality nutritional wise, so it carries a premium.”