Prices for U.S. ethanol fell to the lowest levels in 13 years on Wednesday, pressured by bigger-than-expected output and larger supplies of the corn-based biofuel, traders said.
Weekly U.S. Energy Information Administration data showed that ethanol production last week was up 6,000 barrels per day, to an average of 1.048 million bpd while stockpiles increased 139,000 barrels to 22.93 million barrels.
Some traders had anticipated a decline in output, as many producers were struggling to make money due to low ethanol prices and comparatively higher costs for the corn and natural gas necessary to make it.
“With all the talks of slowdowns, the market expected to see continual drops in production but they haven’t materialized, and margins have taken a further beating,” an ethanol trader said.
