Ethanol Prices Dip as Record Output and High Stocks Ease Supply

Record Weekly Production

The US EIA reported that mid-December ethanol production increased by over 2% in a single week, setting a new all-time high for weekly volume. This surge in output, combined with the seasonally low demand for gasoline blending, has led to a build-up in inventory that is currently capping any price recovery.

Export Markets as a Release Valve

To manage the surplus, US producers are aggressively targeting export markets in India, Canada, and the UK. While these international flows have reached record annual levels, they have not been enough to offset the domestic glut. Analysts expect prices to stay range-bound near $1.60 until the spring planting season provides more clarity on corn feedstock costs.