US weekly ethanol output unexpectedly falls, stocks climb to 12-week high

30 Nov 2022 | Mark Shenk

US ethanol production unexpectedly declined in the week ended November 25 while stockpiles climbed to the highest level in 12 weeks, data published by the US Energy Information Administration (EIA) showed Wednesday.

Production dropped by 23,000 b/d to 1.02 million b/d last week, which would have come as a surprise to analysts, who had responses than extended from unchanged to a 10,000-barrel gain.

Total ethanol production in the Midwest – home to over 90% of total US ethanol production capacity – decreased by 19,000 b/d to 962,000 b/d, according to the EIA.

Over the week, full production equated to the consumption of 2.62 million mt of corn, down from 2.68 million mt a week earlier.

Meanwhile, ethanol stockpiles advanced by 100,000 barrels to 22.9 million barrels in the period covered by the report, which left supplies at the highest level since the week ended September 2.

The stockpile advance came as a surprise to analysts, who had projected that inventory levels would fall by between 100,000 to 200,000 barrels.

Margins calculated through a model from Iowa State University showed that the estimated return over operating costs for the average Midwest-based plant decreased by around $0.16/gallon in the week ending November 25 to $0.17/gallon.

Corn prices for the week averaged $6.92/bu – a 7-cent gain from levels recorded on November 18.

Finished ethanol prices slipped by 11 cents week-on-week to $2.33/gallon.