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US weekly ethanol production surprised the trade by increasing 17,000 barrels per day to 991,000 barrels., above its recent high of 990,000 posted for week ending November 20, and highest since March 20. Stocks were up a large 843,000 barrels to 22.083 million, highest since May 29. A Bloomberg poll looked for weekly US ethanol production to be down 3,000 and stocks to increase 397,000 barrels. Crop year to date (early September through December 4) weekly ethanol production is averaging 945,000 barrels per day, up from 929,000 barrels for the entire 2019-20 crop-year. This is important to watch as in its monthly short-term energy outlook for the US, the EIA estimated 2020 (calendar year) ethanol production to average 900,000 barrels per day in 2020, unchanged from November, and increased 2021 average by 10,000 barrels per day to 980,000 barrels. Both EIA estimates are below the 2019 production average of 1.03 million barrels per day. We look for US ethanol production to rebound back above 1.020 million barrels by the end of Q1 2021. We are using 5.100 billion bushels for corn for ethanol use for the 2020-21 marketing year, 50 million above USDA and compares to 4.852 billion used in 2019-20, down from 5.378 billion in 2018-19. Using the average Sep-early Dec ethanol production, annualized implied corn use, using a 2.80 yield, comes out to 5.171 billion bushels (omits sorghum use of projected 40 million bushels by USDA Nov). For 2021-22, we look for corn for ethanol use to expand to 5.400 billion bushels and if realized, second highest in history. Note China has been asking around for US ethanol quotes, per trade talk.
Terry Reilly
Senior Commodity Analyst – Grain and Oilseeds
Futures International
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Weekly_EIA_Ethanol_Data-FI120920.pdf