Dec 29, 2014
By Sussane Retka Schill
The U.S. ethanol industry is closing out 2014 with a bang, as the ethanol industry has set weekly production records in four of the last five weeks. The U.S. Energy Information Administration reported another week of record-breaking production at 992,000 barrels per day (bbl/d) for the week ending Dec. 19.
U.S. ethanol producers have steadily been ramping up production in recent weeks. According to the EIA, production for the week ending Dec. 12 was 990,000 bbl/d, for the week ending Dec. 5, 988,000 bbl/d, and for the week ending Nov. 21, 982,000 bbl/d. Those production figures top the prior record set earlier this year on the week ending June 13 with its average of 972,000 bbl/d.
“The most recent weekly data indicates the industry was operating at an annualized rate of more than 15.2 billion gallons per year,” said Geoff Cooper, senior vice president of the Renewable Fuels Association. “2014 will be a record year for annual output, with approximately 14.31 billion gallons of production--that eclipses the previous record of 13.93 billion gallons in 2011.”
Ethanol stocks were holding steady in the last couple of weeks. The EIA reported stocks on hand for the week ending Dec. 19 at 17.6 million barrels, down slightly from the previous week’s ending stocks of 17.7 million barrels. The Dec. 19 ending stocks were up 15.7 percent from the number for the same week last year, which was 15.7 million barrels (the lowest stocks since 2009), and down 13.3 percent from the stocks in the same week two years ago, which numbered 20.3 million barrels. The all-out production levels of 2011 led to price-depressing ethanol stocks in 2012, the peak set in March 2012 at 22.58 million barrels.
Current stocks are not yet climbing, Cooper said, because “unprecedented ethanol consumption, particularly from the export market, is keeping ethanol stocks in check and ensuring a good supply-demand balance is maintained in the marketplace. Stocks are about 5 percent lower than they were in September, yet production is up about 9 percent since then. Domestic blending demand has picked up in recent weeks too, as ethanol input by U.S. refiners and blenders hit a 10-week high last week.”
In the Dec. 9 Short-Term Energy Outlook, EIA said ethanol production in November reached a monthly average record of 963,000 bbl/d, exceeding the previous record of 959,000 bbl/d set in December 2011. By the end of November, EIA expected ethanol production to average 931,000 bbl/d in 2014 and 948,000 bbl/d in 2015. With the first three weeks of December setting new records, those numbers are likely to ratchet up a bit more.
“The recent production levels should definitely put to rest any notion that the industry can’t produce enough ethanol to meet statutory RFS requirements for 2015 and beyond of 15 billion gallons,” Cooper added.
Read the original story here : US Ethanol Production Runs Full Bore, Sets Record As 2014 Ends