Ethanol Blog

Even though ethanol inventories grew for the second straight week in a row at the end of last week, most of the current focus is on growing ethanol production. With cash corn prices at or under $4 per bushel in most major ethanol-producing areas, the lower cost of production is creating a great opportunity to take advantage of strong margins. Current profit margins are stronger than they have been in a couple years. Ethanol producers are eager to take advantage of this opportunity. Total ethanol production last week averaged 39.6 million gallons per day. This is a 1.3-million-gallon-per-day jump from the previous week. Current production levels are 14.5% over year-ago levels, and indicating that this growth can be sustained over a long period of time. Total stock levels are listed at 646.8 million gallons, but still 22.9% lower than year-ago levels. The increased production and growing inventories pressured ethanol prices, moving January futures 7.8 cents per gallon lower to $1.926 a gallon.

Rick Kment can be reached at rick.kment@telventdtn.com

(AG)

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