Commodities: Pre-holiday selling hits ethanol markets

FILE PHOTO

November 23, 2015

BY Rick Kment, DTN

Early November proved to be a trial for ethanol markets, which eroded 10 cents per gallon through the first two weeks of the month. Ethanol followed strong declines in both corn prices and RBOB gasoline markets during the same time period.

This year's seasonal pullback in gasoline demand occurred while overall supplies of crude oil continued to grow, thus putting additional focus on price levels through the month of November. This dip in prices may serve as a short-term seasonal low and establishes the lower end of the price range at $1.44 per gallon.

December corn futures contract prices, which continued to hover at $3.63 per bushel at the time of this writing, may draw additional buyer support through early December, although traders are focused on the potential rebound in RBOB gasoline prices surrounding increased holiday demand.

Regional Gasoline Prices ($/gallon)

Front Month Futures Price (RBOB) $1.2888

REGION

SPOT

RACK

 

West Coast 

1.310

1.685

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Midwest    

1.060

1.572

 

East Coast 

1.332

1.636

 

 

Regional Ethanol Prices ($/gallon)

Front Month Futures Price (RBOB) $1.5010

REGION

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SPOT

RACK

 

West Coast 

1.580

1.750

 

Midwest    

1.500

1.695

 

East Coast 

1.570

1.885

 

 

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