Summary: US ethanol production rose less than 1% which is about what the trade had expected. Ethanol stocks dropped 2.5%, which was much more than the trade had expected. Ethanol margins are at or below breakeven depending on if they are calculated relative to variable costs only or all costs. A bipartisan group of Senators reintroduced a bill to create a high-octane, low carbon fuel standard in a drive to expand the use of ethanol.
US ethanol production totaled 295 Mil Gal, down 3 Mil from the previous week and 3% below a year ago. Production needs to average 299 Mil Gal to week to meet the USDA forecast. USDA projection for corn ethanol grind is 5,250 MBU, ARC’s projection is 25 MBU below that.
Ethanol stocks are 1,072 Mil Gal vs 1,100 Mil last week and down 4% from last year.
Gasoline consumption was 9.15 Mil Bbls per day vs 8.96 Mil the previous week and is up 8% from last year.
Crude inventories were 474 Mil Bbls, down 7 Mil from the previous week but up 16% from last year.
The cash-based ethanol crush margin is displayed below. It assumes $6.89 corn, $2.15 ethanol and $243/ton DDGS.