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Winter weather pushes ethanol production lower

U.S. ethanol production dropped last week and supplies shot higher as bitterly cold weather, heavy snowfall, and a lack of available natural gas restricted corn movement, closed some plants, and limited travel.

That has compounded some of the issues already facing the industry, including slower blending demand caused by reduced travel linked to COVID-19 and higher input costs because of higher corn prices.

The U.S. Energy Information Administration says production averaged 911,000 barrels a day, down 26,000 barrels on the week and 129,000 on the year for the lowest average since late September 2020.

The domestic supply jumped about 501,000 barrels from the previous week to 24.297 million barrels which is 484,000 under year ago levels because of reduced production.

The Renewable Fuels Association says net inputs by refiners and blenders were fractionally higher than the week before and gasoline demand was up sharply, but both of those measures of demand were below this time last year.

The USDA says Midwest ethanol prices were mixed last week, while the limited movement supported cash corn.

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