Ethanol Blog
George Orwel DTN Energy Reporter

Tuesday 01/28/14

Argo, NYH Ethanol Rally Linked to Tight Natural Gas Supply

Spot ethanol traded higher in Chicago and New York this afternoon amid speculation a shortage of natural gas may have forced at least two ethanol plants in Wisconsin to cut runs or shut down, potentially reducing domestic production.

Back-to-back arctic blasts have led to a sharp drawdown of U.S. natural gas supply, with the situation aggravated in the upper Midwest by a pipeline explosion two days ago in Canada.

"Swaps are rallying hard because of natural gas," said a trader. "I heard the problem was caused by the pipeline explosion," added another trader.

Prompt ethanol at Argo hub near Chicago traded early trade at $1.82 per gallon, up 2.0 cents on the day. February delivered ethanol in the New York Harbor traded at $2.05 and $2.06 and was last talked at a $2.08 to $2.10 per gallon bid/ask, up 6.5 cents on the day.

George Orwel can be reached at george.orwel@telventdtn.com

(ES)

Posted at 1:53PM CST 01/28/14 by George Orwel
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