Ethanol Rises Against Gasoline

On May 8, 2013, in ethanol futures news report, by Infinity Trading
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Ethanol futures rise

May 7th, 2013

Ethanol futures advanced against gasoline on speculation higher export demand is tightening supply along the U.S. East Coast.

The spread, or price difference, contracted 7.43 cents to 27.04 cents a gallon as ethanol stockpiles in New York Harbor in the week ended April 26 dropped to a record low 5.6 million barrels, data from the Energy Information Administration show, even as total gasoline demand trails year-earlier levels. Renewable Identification Numbers were mixed.

“Some of these guys must be exporting,” said Michael Slider, director of business development at Fauser Energy Resources in Oregon, Illinois. “Some of the storage on the East Coast has been going on ships.”

Denatured ethanol for June delivery rose 4.2 cents, or 1.7 percent, to $2.563 a gallon on the Chicago Board of Trade. Futures have gained 16 percent in the past year.

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March 11th, 2013

Ethanol Futures – Ethanol’s discount to gasoline narrowed to the lowest in more than a week as the motor fuel plunged and as the value of renewable identification numbers, or RINs, for biofuel blending was near a record.

The spread contracted 8.31 cents to 60.84 cents a gallon as production costs reduced output to the least for this time of year in records going back to 2010. Prices for corn-ethanol- based RINs climbed fell to $1.01, from a record $1.06 on March 8. Refiners use the certificates to comply with government renewable-fuel mandates in lieu of blending.

“We’re certainly seeing a lot of activity in RINs,” said Michael Slider, director of business development at Elgin, Iowa- based Fauser Energy Resources. “With production off, people are grabbing RINs to meet their requirements.”

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March 6th, 2013

Ethanol futures strengthened against gasoline as stockpiles of the biofuel fell to the lowest level ever for this time of year.

The spread narrowed 2.83 cents to 68.79 cents a gallon at 10:57 a.m. New York time after an Energy Information Administration report showed U.S. inventories were 19.4 million barrels for the week ended March 1, the lowest level for the first week of the month in records going back to 2010.

“Seems like there’s less and less available and people are paying higher prices to get what they need,” said Jim Damask, a manager at Starfuels in Jupiter, Florida.

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February 12th, 2013

Brazilian ethanol prices trading above raw sugar futures for the first time in almost two years are spurring speculation that millers will favor making the biofuel over the sweetener in the season starting in April.

Hydrous ethanol, used in flex fuel cars in Latin America’s largest economy, is trading at about 19 cents a pound, according to Lausanne, Switzerland-based Kingsman SA, which has provided sugar and biofuels research for more than 20 years. The price is 4.7 percent higher than raw sugar futures trading at 18.14 cents a pound on ICE Futures U.S. in New York today. Ethanol surpassed sugar for the first time since April 2011 on Feb. 7, said Beatriz Pupo, a Kingsman analyst.

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December 14th, 2012

Ethanol Futures – Ethanol’s discount to gasoline expanded to the widest level in three weeks as the motor fuel advanced on renewed economic optimism.

The fuels gained as Federal Reserve data showed U.S. industrial production rose in November by the most in two years and after a preliminary purchasing managers’ index said China’s manufacturing is expanding at a faster pace this month. The Energy Department said Dec. 12 that ethanol stockpiles were at the highest level since June 29.

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November 26th, 2012

Ethanol futures in Chicago climbed against gasoline for a second day as Brazil’s sugarcane harvest neared its end.

The biofuel, made from corn in the U.S. and from sugarcane in Brazil, gained as industry association Unica said sugar mills in Brazil’s sugarcane belt will begin to shut down in the coming weeks. The mills crushed 42 percent more cane in the first half of November than they did a year earlier.

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November 7th, 2012

Ethanol Futures – U.S. ethanol production is headed for the first decline in 16 years, jeopardizing the nation’s drive to boost alternative fuels, as higher costs and lower demand close plants.

Shrinking distilling margins have resulted in a 14 percent drop in output this year to 827,000 barrels a day, or 12.7 billion gallons annually, Energy Department data show, 500 million gallons short of the amount refiners are mandated to use under a 2007 law that calls for escalating consumption of the biofuel. That would be the first yearly decrease since 1996.

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August 23rd, 2012

Ethanol futures, the best-performing energy commodity this year, is cheaper than gasoline, encouraging refiners to use the biofuel even if President Barack Obama’s administration ends a requirement to do so.

A 48 cent-per-gallon discount to gasoline provides companies including Exxon Mobil Corp. and Valero Energy Corp. (VLO) an opportunity to profit by blending the corn-based additive into fuel, while easing prices at the pump for consumers. Marketers may use ethanol as they look for the cheapest way to boost engine performance and reduce pollution.

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ethanol futures tumble

August 6th,2012

Ethanol futures fell in Chicago as rain and cooler weather in the U.S. Midwest provided some relief to drought-withered corn crops.

Ethanol tumbled after rain over the weekend improved the prospects for corn, the primary ingredient used to produce ethanol in the U.S. Distillers have responded to higher corn prices brought about by drought by cutting output by 16 percent to 809,000 barrels a day from a record 963,000 on Dec. 30.

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March 5th, 2012

Ethanol futures climbed to a three- month high in Chicago as corn surged on speculation that export demand will increase.

Ethanol futures rose after Liu Yonghao, the chairman of New Hope Group Co., China’s top maker of livestock feed, said the country should reform its corn-import system by dropping shipping quotas or boosting the amount buyers are able to purchase. Corn is used to make ethanol in the U.S.

“Corn was stronger today and ethanol kind of went with it,” said Matt Janney, a trader at Citigroup Global Markets Inc. in Chicago. “I’m sure the ethanol guys need to be bidding up to get the corn.”

Denatured ethanol for March delivery advanced 2.9 cents, or 1.3 percent, to $2.289 a gallon on the Chicago Board of Trade, the highest price since Dec. 5. Futures have gained 3.9 percent this year. The March contract expired today.

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