Dec. 29—As 2008 draws to a close, the ethanol and energy industries look completely different than anyone would have expected just months before. Ethanol futures prices have are once again trading at a premium to gasoline markets as ethanol production companies have shown signs of financial turmoil that may cause supplies to become tight.

In the first few months of 2009, gasoline prices are expected to remain low compared to levels seen over the past several years, with the front month RBOB gasoline price trading at 84 cents per gallon. This plummet in price levels is largely due to the dismal economic news that seems to be surfacing almost daily. The lack of consumer demand as well as overall weak confidence in the markets seems to have kept most commercial and noncommercial (speculative) buyers out of the market for the meantime.

Ethanol prices continue to be pressured by the weak gasoline markets, although the stronger corn prices through the month of December have helped to push ethanol prices higher in order to maintain at least slim margins at ethanol plant levels. Ethanol prices are currently tied to the movement in corn prices much more than energy price movements as concerns of supply shortages seem to be building through the country. Regulated demand for ethanol in order to meet the current Renewable Fuels Standard continues to keep ethanol prices elevated compared to gasoline markets. But demand typically increased through the early spring and summer months as additional driving takes place. This could cause energy prices to rebound over the next several weeks.