Key Highlights

  • Ethanol fell 0.98% to US$2.02 per gallon during today’s session.
  • Prices are down 2.88% over the past month.
  • Ethanol remains 18.13% higher than a year ago.
  • A market forecast puts fourth-quarter ethanol at US$2.06 per gallon.

Ethanol prices slipped during today’s session, falling to US$2.02 per gallon, down US$0.02, or 0.98%, from the previous day.

CBOT Benchmark Activity and Market Pricing Overview

Ethanol is 2.88% lower than a month ago but 18.13% above its level a year earlier, according to market data. A market forecast for the fourth quarter stands at US$2.06 per gallon, slightly above current levels.

Producers, blenders and traders use exchange contracts to manage price risk in the US fuel ethanol market. Ethanol usually trades at a discount to wholesale gasoline, which gives blenders an economic incentive to use it. For reference, RBOB gasoline futures traded near US$3.21 per gallon during today’s session.

Weekly EIA Inventory Data and Production Dynamics

The weekly Energy Information Administration report is the main short-term data source for ethanol. It covers plant production, stock levels and export volumes, which together show whether supply is building or tightening.

The Renewable Fuel Standard and D6 RIN Credit Economics

The Renewable Fuel Standard, administered by the Environmental Protection Agency, sets annual volume requirements for renewable fuels. Refiners and importers, known as obligated parties, must retire tradeable credits called Renewable Identification Numbers (RINs) to show compliance. Each gallon of conventional corn ethanol generates a D6 RIN, and D6 prices influence blending margins and compliance costs.

Midwest Corn Harvest, Crop Progress and Crush Margins

Corn is the main feedstock, and ethanol plants consume a large share of the US crop. The crush margin is the spread between corn costs and the combined revenue from ethanol and co-products, mainly distillers grains and corn oil. The autumn harvest brings fresh corn deliveries to plants, so feedstock costs and plant margins are closely linked to crop conditions.

Implications for Refiners, Blenders and Retail Forecourts

Most US gasoline is sold as E10, which is 10% ethanol. Blenders buy a lower-octane gasoline blendstock and add ethanol, which has a high octane rating, to produce regular unleaded at lower cost. Wider availability of E15 at retail stations offers consumers further savings and expands the market for ethanol producers.

Long-Term Evolution: E15 Expansion, SAF and Carbon Accounting

The biofuel industry continues to push for permanent, nationwide year-round E15 sales, which would remove summer vapor pressure limits that have forced some stations to pause sales. Section 45Z clean fuel production credits reward lower carbon intensity, which encourages producers to invest in carbon capture, renewable power and climate-smart feedstock. Ethanol is also a potential feedstock for alcohol-to-jet sustainable aviation fuel projects.