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I'm not sure what it costs in bulk, but blackstrap molasses is the traditional feedstock for making rum and many other ethanol-based spirits and it's cheap. It's essentially the waste byproduct created from refining sugar cane into sugar. They sell it cheap because otherwise they'd have to treat it as a toxic byproduct.
I don't know what the economics of blackstrap will be, however, if it becomes a popular feedstock for making ethanol.
--Peter
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Blackstrp and other types of molasses for human consumption are all made from sugar cane. There's another type made from sugar beets that is used only for animal feed. I would think it would be even cheaper.
This topic got me interested on ethanol technology. Switchgrass and algae may be used in the future as feedstocks if they can cheaply produce the enzyme that breaks them down into sugars. Here are some interesting links:
switchgrass
algae
E85 forum