Ethanol producer margins expected to increase

Photo by Joe Raedle/Getty Images

In more than 150 trading sessions this year, corn and ethanol market prices have moved in unison nearly 69 percent of the time, said Jordan Godwin, U.S. biofuels editor, Platts, in a webinar today entitled “Corn Projections and the Possible Impact on the Biofuels Industry.” High ending stocks for corn and the expected record-high crop of 14 billion bushels of corn this year, coupled with lower overall demand for corn, could drive soaring margins for ethanol producers in the last two quarters of this year, Godwin said. If ethanol continues to follow lower corn prices, and barring any unforeseen catastrophes, the ethanol industry could gain traction politically, he said.

 

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