Kinder Morgan began redirecting ethanol delivery trucks Monday away from its Argo, Illinois, terminal to the company's nearby Stony Island liquids terminal, multiple sources said.
"They usually do it when the inbound is out of pace with outbound," said one source.
The company has redirected deliveries in the past when storage inventory levels have climbed and incoming product, such as an already-booked rail delivery, could make for a tight squeeze in the tanks.
This is the third time in 2017 that Kinder Morgan has turned trucks away from Argo. The first was in February, the second in May, both when inventory levels in the Midwest were high.
In the past, Kinder Morgan has informed customers by email when truck deliveries can resume.
Midwest storage inventories fell 281,000 barrels in the week that ended November 10, according to the most recent US Energy Information Administration data. But, even with that decline, stocks remained 1.391 million barrels higher than in the same week last year.
The Argo and Stony Island terminals comprise Kinder Morgan's fungible system. So, though deliveries to Argo have ceased, market participants can continue to trade Argo product even if the physical barrels are at the Stony Island terminal.
S&P Global Platts assessed Argo at $1.38725/gal Monday, down from $1.4050/gal on Friday.
Kinder Morgan spokeswoman Lexey Long said the company could not confirm activities at Argo.
"For competitive reasons, we don't comment on inventory levels at our terminals or fluctuations in storage capacity related to supply and demand or other market-related issues. Nor do we comment on information that we share directly with our customers," she said.
