Ethanol Blog

Ethanol futures posted a strong 4-cent gain in front-month contracts Monday. This most recent support comes following the previous four trading sessions of steady to higher price levels. After the front-month contract fell 25 cents per gallon due to sharp corn market losses, moderate to strong buyer interest has steadily and quickly redeveloped. Ethanol futures have moved 13 cents per gallon higher in the month of April despite starting out on April Fool's Day falling an additional 10 cents per gallon. Buyer support is not only coming from the corn market where traders are looking for markets to gain back a portion of the losses. But the impact in the gasoline market and potential demand growth through the spring is driving buyer support. There will be increased questions about just how firm recent gains will hold up. The USDA supply and demand report is going to be released on Wednesday. This may limit additional support through the ethanol market if the report is bearish. But ethanol markets are currently focusing on potential support in energy market and building demand growth of the market.

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

© Copyright 2013 DTN/The Progressive Farmer. All rights reserved.