Last week, domestic ethanol demand was 13.3 BGY, up 2.6% compared to a week ago. The EIA-reported gas demand was up 1.6% from last week, at 127.3 BGY. The 4-week average ethanol and gas demand are 13.5 BGY and 130.2 BGY (unchanged YoY). (Note: forecast average blend level in 2026 is 10.45%. Since the week before straddled 2025 and 2026, the ethanol penetration rate for that week was 10.36%, a weight average of the two based on the days in each year.)
Ethanol production was 18.3 BGY last week, up 8.9% versus the week before, and 16.0% more than the 4-week average in 2019. Midwest production was up 9.4% (+28.8 MG) versus a week ago, and average production in the other regions was unchanged. The large increase in Midwest production and the total production are unusual to the point of being suspect. [Note: Usually the EIA weekly ethanol production is one of the more accurate measures the EIA takes each week, but this week’s reported volume should be taken with a healthy dose of skepticism. A possible reason for it not to be accurate may be related to the preceding holiday period with ethanol and EIA staff involved with collecting the data having been on vacation or preoccupied with other matters. Unless the EIA revises the production data in the meantime, production reported a week from now will be an opportunity to either further suspect or support the data this week.]
Ethanol production capacity utilization of plants online was 101.8% overall, 103.5% in the Midwest, and 76.5% on average, elsewhere, excluding 1,258 MGY of capacity shutdown at 25 ethanol plants for other than maintenance. On an installed capacity basis, utilization was 95.2% overall, 100.7% in the Midwest and 45.4% in the other regions. [Note: While the higher than 100% capacity utilization is possible on a short-term basis, in this instance we think it is another indication of there being a problem with the reported Midwest production this week. Another reason for suspicion is that there was negligible change in production in the other four regions.]
Exports were an estimated 42.9 MG last week based on 190 MG forecast for January. The EIA reported no ethanol imports last week.
Overall inventory was up 49.6 MG last week. EIA-counted stocks were increased 34.5 MG, and regional changes were: East (+26 MG), Gulf (+18 MG) and West (+5 MG) Coasts and the Midwest (-15 MG). In-transit inventory levels increased 15.1 MG.
Based on the total inventory of 1,451 MG on January 9th and the 4-week avg. domestic demand, there were 37.7 days of supply, up 1.4 days from a week ago. Including the 4-week avg. of net exports, there were 32.5 days of supply, up 1.1 days from a week ago.
Based on US Census data, ethanol exports in October were 201.4 MG, including an estimated 16.9 MG used to make ETBE for export with 14.7 MG to Japan (assuming 60% of ETBE exports were derived from U.S. corn ethanol), 1.5 MG to France, and 0.7 MG to the Netherlands. The major export destinations were Canada (91 MG), The Netherlands (41 MG), United Kingdom (13 MG), South Korea (9 MG), Mexico (8 MG), Columbia (7 MG), India (8 MG), and lesser amounts to other countries. The total to Europe (EU + UK) was 59 MG. Through October YTD, ethanol exports have totaled 1,875 MG, 14% more than YTD 2024.
Based on US Census data, 0.3 MG of fuel ethanol was imported in October, all from Canada Through October, imports have totaled 9.7 MG, 35% less than 2024 YTD. In October, there were no ethanol imports reported for industrial use from Brazil, likely for ETBE production and re-export to Japan, and YTD there have been 57.3 MG, 10.6% less than YTD 2024.