Spot Ethanol Buoyed by Lower Production, Corn Futures Gain
10/12 12:42 PM
Spot Ethanol Buoyed by Lower Production, Corn Futures Gains NEW YORK (DTN) -- Spot ethanol prices moved higher in early trade Thursday following U.S. data showing ethanol production fell last week with support also found with higher Chicago Board of Trade corn futures. "We had a bullish [ethanol] production number and corn started rallying immediately after the WASDE report came out," said a source. The Energy Information Administration reported ethanol plant production in the United States fell 43,000 bpd or 4.3% to 967,000 bpd during the week-ended Oct. 6. Blending demand rose 7,000 bpd or 0.75% to 937,000 bpd, and is up 21,000 bpd or 2.3% year-over-year. Also, corn futures rallied after the U.S. Department of Agriculture released its latest World Agricultural Supply and Demand Estimate at noon showing lower than expected U.S. ending corn stocks although yield and production were higher. At 1:15 PM ET, December corn futures gained 3.4cts to $3.494 bushel. November RBOB futures on the New York Mercantile Exchange fell 3.0cts at $1.5792 gallon, trading at a 15.0cts premium to ethanol futures. In ethanol paper trade, November ethanol futures edged up 0.5cts to $1.43 gallon, with swaps also trading at $1.43 gallon for October. In physical trade, prompt supply fuel ethanol at the Argo terminal in the Chicago market was pegged at $1.44 gallon for a gain of 1.0cts on the session, and October anys traded at $1.43 gallon. In the rail shipment market, ethanol under Rule 11 terms for this week transport was discussed at a $1.41 to $1.43 gallon bid/ask, up 1.75cts for the session. On the East Coast, October barged ethanol at the New York Harbor traded at $1.47 gallon and on spread basis at 7.0cts over Chicago prices, which is equivalent to $1.50 gallon for a gain of 2.0cts on the session. This week shipment of ethanol in northern California was notionally pinned at $1.56 gallon, up a penny for the session. In the Gulf Coast, barged ethanol in Houston was talked at $1.50 gallon, up 1.0cts. George Orwel, 1.718.522.3969, george.orwel@dtn.com, www.dtn.com. (c) 2017 DTN. All rights reserved.