Ethanol Blog

Ethanol Futures Establishing Stability

Rick Kment
By  Rick Kment , DTN Analyst

Ethanol futures posted light to moderate gains as traders returned from the long holiday weekend with prices gaining nearly 1 cent per gallon in nearby contracts and slightly more aggressive support through deferred contract months.

Front-month ethanol prices have traded in a narrow 4-cent price range on either side of $1.45 per gallon since the beginning of the month.

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This is creating some additional stability in the complex, and could help to draw increased buyer support back into the market through the next two weeks.

Although there is growing focus on the potential to sustain additional demand for both gasoline and ethanol in the coming weeks and months, the concern that stable corn prices and growing supply levels of ethanol may keep price support limited in the near future.

Narrow premiums are starting to develop in summer contract months, but there still remains the same hesitancy in the complex as seen in front-month contracts about just how much long term support can be sustained.

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

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