Ethanol Blog

Despite the stability and light support in corn markets, ethanol futures found absolutely no support through the end of the session. November contracts fell 1.7 cents per gallon to $1.791 a gallon at closing bell. But December markets posted the most aggressive losses, falling 2.2 cents per gallon and closing at $1.661 a gallon.

The lack of support in ethanol markets appears to be based on moderate to strong pressure which redeveloped in energy futures. RBOB gasoline contracts fell 4 to 5 cents per gallon in nearby futures contracts, while crude oil futures posted losses of $1.62 to $1.79 a gallon, although there seemed to be some early relief that debt limit issues and the government shutdown has been settled for now. The fact that congress kicked this issue down the road until early 2014 appears to be weighing on contracts in late 2013 and the first quarter of 2014. The upcoming holiday spirit may allow for better cooperation in congress, but most expect the battle to be just as fierce, if not more so, when this issue redevelops next year. For now, there is concern that overall demand for gasoline and ethanol products both may be lackluster during the next several months.

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

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