Record Crop, Record Ethanol Production in the US: report

In Washington, US farmers are “poised to harvest a record corn crop this fall and achieve the highest yield per acre in U.S. history”, according to new U.S. Department of Agriculture estimates which project the 2016 corn crop at 15.15 billion bushels, with a record average yield of 175.1 bushels per acre.

Corn ending stocks for the 2016/17 marketing year are projected at 2.4 billion bushels — the highest in 29 years. Meanwhile, prices are expected to average just $3.15 per bushel, the lowest in 10 years. Global grain supply is also set to establish a new record and grain stocks are likely to hit historic highs. U.S. ethanol is expected to consume just 2.9 percent of world grain supply on a net basis.

According to EIA data s anlyzed by the RFA, ethanol production averaged 1.018 million barrels per day—or 42.76 million gallons daily. That is up 14,000 b/d from the week before and the second-largest total on record. The four-week average for ethanol production stood at a record 1.012 million b/d for an annualized rate of 15.51 billion gallons. Gasoline demand for the week averaged 410.3 million gallons (9.769 million barrels) daily. Since Memorial Day, gasoline demand has averaged 149.3 billion gallons annualized. Refiner/blender input of ethanol averaged 950,000 b/d.

Bob Dinneen said that the estimates “snuff out the last flickering embers of the outrageous food vs. fuel debate.” He added that the government reports highlight the importance of getting the Renewable Fuel Standard back on its statutory track in 2017.  “The EPA’s disappointing proposal for 2017 Renewable Fuel Standard volumes is exacerbating the predicted drop in corn prices and farm income this year. EPA’s proposal to needlessly reduce the 2017 RFS requirement for “renewable fuel” from 15.0 billion gallons to 14.8 billion gallons reduces demand for corn at a time when corn stocks are rising and prices are slumping to levels below the cost of production.”

DOE projects 2016 ethanol production will average 980,000 barrels per day — or 15.1 billion gallons. The agency also is projecting record ethanol consumption of 14.3 billion gallons.

“Farmers and ethanol producers made investments and business decisions based on the 2007 law that expanded the RFS, and they expected EPA to follow Congress’ intent in implementing the program,” Dinneen said. “EPA’s proposal is limiting market opportunities for U.S. farmers at a time when the agricultural economy needs a boost. We again urge EPA and the Administration to finalize a rule that truly gets the RFS back on track and supports rural America.”

http://www.ethanolrfa.org