Ethanol inventory levels remained steady from the previous week on the latest EIA report with 802.2 million gallons of ethanol available to be used at the end of last week.
Even though inventory levels are steady with the previous week, overall stocks are 6.5% below year-ago levels. The combination of steady supplies, falling plant production levels and increased blending demand should be supportive for the overall ethanol market.
But this support was nowhere to be seen Wednesday afternoon with front-month January ethanol futures falling another 1.8 cents per gallon, moving to $1.549 per gallon. Current price levels are still 3 cents above short-term support levels set at the end of November, but there continues to be underlying pressure developing across the complex.
Lack of volume through the entire complex through the holiday season is expected to bring additional pressure into the ethanol market both before and after the Christmas break.
Rick Kment can be reached at email@example.com
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