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As inventory grows, ethanol prices and production fall
Ethanol production continues to fall but the ethanol inventory continues to increase. And ethanol prices have fallen to their lowest levels since June of 2010.
The U.S. Energy Information Administration said that last week’s ethanol production dropped from 889-thousand to 881-thousand barrels per day while inventories increased to 18.8 million barrels.
According to DTN market analyst Rick Kment, September saw a near freefall in ethanol futures as prices declined more than 60 cents per gallon. Front month October ethanol futures fell from $2.20 per gallon at the end of August to $1.58 in late September.
Kment says additional price pressure is likely still to come and there is concern that another ethanol glut could be developing. He adds the slowdown in demand for ethanol also comes at a tough time for corn and is contributing to bearish pressures on corn prices.
Tags: Ethanol, Renewable Fuels
API needs to stop restricting the use of ethanol by not offering mid grades and lying about ethanol.How many Blender Pumps are there in Omaha.?