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Then we have to factor in transportation costs of getting the corn to the ethanol plant, costs to actually MAKE the ethanol, and costs to transport the ethanol to the gas pumps (this is higher than transporting regular gas because ethanol can't be shipped via pipeline like gas can).
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The farmers don't HAVE to use harmful pesticides. Also, tf the country gets serious about E85 they can always build piplelines. There are no fluid properties that make ethanol unfit for pipeline transport.