Spot ethanol prices in Houston have surged 44.5 cents since Feb. 21 to a $2.885 gallon three-month high Wednesday as logistical challenges constrain supply for exporters.
"A pretty steady export program is going in ethanol," said Jerrod Kitt, a strategist for the Linn Group in Chicago, Ill. "At least half go out through Gulf Coast. So, if run out of supply and you've got export demand, you've got a problem."
Energy Information Administration supply data for the week-ended Feb. 21 released today shows ethanol supply in the Gulf Coast was drawn down 109,000 bbl to a 2.778 million bbl three-week low.
"Supplies are artificially low due to rail logistics," Kitt added.
Myke Feinman can be reached at firstname.lastname@example.org
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