Ethanol Blog
Rick Kment DTN Analyst

Friday 01/11/13

Tight Corn Supplies Spark Ethanol Buying

Ethanol futures surged higher following the 11 a.m. CT release of the USDA crop report.

Although corn production was increased in the latest report, the reduction of corn supplies was the main driver of buying in the market.

Ethanol production was left unchanged, although increased demand from feed demand posted a moderate to strong increase. Overall, the tighter supply levels continue to keep the market bullish heading into the spring.

Given the uncertainty of spring and summer weather conditions and fears of additional drought, traders are focusing on still tight corn supplies through the spring and summer.

March contracts closed 10 cents higher, at $7.08 per bushel. This active support in the corn market helped to drive sharp gains back into the ethanol market, which gained 4 to 4.6 cents per gallon Friday.

Rick Kment can be reached at

Posted at 4:19PM CST 01/11/13 by Rick Kment
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