Ethanol Margins Strong, Huge Rebound from Pandemic Meltdown

Source: By WNAX • Posted: Tuesday, December 7, 2021

Ethanol Margins Strong, Huge Rebound from Pandemic Meltdown

Ethanol margins are at near record levels and have taken a nearly 180-degree turn since the height of the pandemic in the spring of 2020. POET’s Vice President of Corporate Affairs Doug Berven says the strong rebound in the demand for ethanol is a driving factor in their improved profitability.

Ethanol prices have cooled from their highs with futures at $2.71 on Monday. However, average ethanol prices in Nebraska were at $3.06 per gallon and more than $2.00 above prices at this same time in 2020. Prices in other states in the region were around $3.20. Berven says that’s allowing ethanol plants to heal from the COVID disaster and look ahead.

Higher crude oil and unleaded gas prices also factor into the margins for ethanol, but Berven says its not energy prices alone.

Better ethanol margins have also translated to strong cash corn prices, which in some cases are running over the futures.