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February 1st, 2017
A record production week was noted this week at 1.061 million barrels per day. This was a big deal because it was yet another week of record production at the time when normally we are seeing a dip. This week’s production ran 10.6% over last year in the same week.
Our year to date pace is 4.8% over last year. USDA’s goal in corn for ethanol is for a 2.3% increase for the whole marketing year. We are running far ahead of USDA’s hopes. This comes even before pointing out that the conversion rate could be lower than last year.
On the other hand, this great pace will not last. Ethanol prices have already tanked due to the potential ending of RIN’s. US agriculture expects the new administration to keep the ethanol mandate but to tie it to actual gallons rather than RIN’s.
It is clear we are blowing the doors off USDA’s corn for ethanol hopes. On the other hand, this simply offsets the concern the trade has about USDA’s still too-high feed/residual use number.Ethanol Production, Nelson's Notes | Comments Off on Weekly Ethanol Production 2-1-2017