Spot ethanol prices eased in Chicago for the second consecutive session Tuesday amid pressure from rising supply and soft demand, as well as on lower Chicago Board of Trade corn futures.
"We are producing more than what consumers want," a source said. "We are well supplied in the domestic market and there's (ethanol imports) coming from Brazil to the West Coast."
Another source said the contango price structure for ethanol reflects a short-term over-supplied market. A contango is when the futures price of a commodity is higher than the spot price.
Prompt-delivered ethanol at the Argo terminal in the Chicago market traded down 1 cent at $1.43 gallon, while any March-delivered product traded at $1.46 gallon. April deliveries in the Chicago market traded at $1.49 and May deliveries traded at $1.50 gallon.
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