Houston — US ethanol production averaged 1.073 million b/d in the week that ended August 17, up1,000 b/d week on week, Energy Information Administration data showed Wednesday.
Output in the most recent reporting week rose 21,000 b/d or 2% compared with the year-ago week. Production was within market expectations, sources said.
Stocks rose a total of 242,000 barrels in the most recent week, with builds concentrated on the Gulf and East coasts. Inventories were 1.75 million barrels above the same week last year and the highest since mid-March. The build was at the higher end of market expectations, although most sources were predicting a substantial draw for the week.
The Gulf Coast led the increase, with stocks rising 297,000 barrels, reaching another all-time high for the region after posting one last week too. The Gulf Coast is the most common origin for ethanol exports from the US, so some of the increase may have been to meet ongoing export demand. Prices at their current low levels could also be encouraging export bookings.
East Coast inventories rose 235,000 barrels week on week. New York Harbor, the largest trading hub on the East Coast, spent much of July short, with market participants searching for product. But the arrival of delayed trains softened premiums in that market as supply and demand became more balanced. Midwest inventories fell 265,000 barrels as traders moved product out of the region. The Midwest is host to the largest number of ethanol plants across all US regions.
West Coast stocks fell 38,000 barrels to 2.449 million barrels, with the EIA again reporting no imports in the most recent week. The EIA has not reported any ethanol imports since the week that ended December 1, 2017.
The West Coast is the most common destination for imports as Brazilian sugarcane-based ethanol generates both D5 renewable identification numbers (RINs) and Low Carbon Fuel Standard credits under California's LCFS.
The four-week rolling average of the refiner and blender net ethanol input rose 1,000 b/d to 945,000 b/d, while the weekly average fell 5,000 b/d to 943,000 b/d.
The four-week rolling average of gasoline demand, represented by product supplied, slid 99,000 b/d to 9.547 million b/d, while the weekly average dropped 59,000 b/d to 9.453 million b/d.
The four-week rolling average of the ethanol blending rate, calculated by dividing the refiner and blender ethanol input by gasoline demand, rose to 9.90% from 9.79% the previous week.
