Ethanol producers eye selling natural gas to book profits and cut production

February 16, 2021 |

In Texas, Reuters reports that ethanol producers are taking advantage of sky-high natural gas prices by reducing their ethanol production, and therefore natural gas consumption, in order to sell the fuel back onto the market. The extremely unusual winter weather experienced across the country has pushed natural gas prices to $157.714 per million BTU while ethanol margins have sunk as low as negative $3.92 a gallon, quoting Refinitiv Eikon data. One ethanol producer estimated that natural gas costs run about $30,000 per day but if a producer had to go into the market with prices as they currently are, it would cost around $2 million per day.

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Category: Fuels

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