Ethanol Blog

Ethanol prices continue to tumble lower Wednesday, following pressure in the corn market, as well as evidence of inventory levels building while overall ethanol production is starting to fade through the middle of the summer.

Total ethanol inventory grew by 29.4 million gallons over the last week which is an increase of 4.1%. This is the third week in a row that inventory levels have grown.

The overall focus in the ethanol market is now moving past corn price shifts and production levels, and back to overall demand. With the majority of the summer and driving season now in the books, overall ethanol demand is expected to continue to erode. This may push stocks even higher, which will likely add even more price pressure to the nearby ethanol futures market.

August contracts fell nearly 5 cents Wednesday, which leads to prices falling 23 cents per gallon during the last week. With no sense of stability in the near future, this could put additional pressure on all segments of the ethanol industry.

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

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