The estimated production margin for a typical US Midwest dry-mill ethanol plant for the week ended Friday plunged 16.01 cents, or 16.1%, to a two-month low of 83.43 cents/gal, a review of US Department of Agriculture and Platts data showed.
The margin made its steepest week-on-week decline in nearly five months as ethanol prices tumbled in reaction to bearish supplies data and corn projections.
The estimated ethanol price used in calculating the margin was the weekly average of the Platts Chicago Argo ethanol assessment, which shed 19.14 cents, or 8.9%, to $1.9594/gal, a seven-month low.
The weekly average estimated delivered feedstock corn cost shed 10.94 cents, or 3.14%, to $3.3721/bushel, a four-year low.
The weekly average estimated dried distiller grain byproduct price shed $3.12/st to $114.67/st, ending a three-week rise.
The estimated denaturant cost shed 5.3 cents to $2.0363/gal, while the estimated monthly natural gas cost was unchanged at $4.05/MMBtu.
The denaturant cost was based on the weekly average of the Platts natural gasoline assessment at the Conway, Kansas, hub, while the gas cost was based on the September Platts Chicago ANR 7 pipeline monthly index.
The estimated production margin for a typical dry-mill ethanol plant was calculated by weighing data from Platts and government agencies, including average delivered corn cost, dried distiller grain prices, natural gas prices, certain blending costs and ethanol prices.
Fixed-cost calculations were based on a 50 million gal/year-capacity Midwestern plant with 32 employees working at an average salary of $47,300/year.
