EIA says ethanol production, inventories both rise on week

Source: By Wesley Swift, S&P Global • Posted: Sunday, October 18, 2020

Houston — US ethanol production averaged 937,000 b/d in the week ended Oct. 9, up 14,000 b/d on the week while down 34,000 b/d year on year, Energy Information Administration data showed Oct. 15.

Production was in the middle of market expectations as seasonal maintenance was predicted to weigh on output through mid-October. Ethanol plants around the country go offline for about five days to finish routine maintenance in September and October.

US ethanol stocks increased by 336,000 barrels to 20.008 million barrels. The build was within expectations, but toward the high end.

Gulf Coast stocks added 537,000 barrels to end the week at 3.626 million barrels. The Gulf Coast is the origin for most exports from the US as well as a key consumption hub.

West Coast inventories grew by 107,000 barrels to 3.274 million barrels with 25,000 b/d of imports reported on the week. Ethanol imports typically flow into California, as imported sugarcane-based ethanol from Brazil generates more value from carbon credits under the state’s Low Carbon Fuel Standard.

The Midwest region dropped by 206,000 barrels to finish with 6.333 million barrels. The Midwest is home to most of the ethanol plants in the US and is a significant trading hub. East Coast stocks shed 94,000 barrels to end the week with 6.393 million barrels.

The four-week rolling average of the refiner and blender net ethanol input increased by 5,000 b/d to 842,000 b/d, while the weekly average rose by 41,000 b/d to 864,000 b/d.

The four-week rolling average of gasoline demand, represented by product supplied, rose by 25,000 b/d to 8.629 million b/d. The weekly average fell by 320,000 b/d to 8.576 million b/d.

The four-week rolling average of the ethanol blending rate, calculated by dividing the refiner and blender ethanol input by gasoline demand, increased to 9.76% from 9.73%.