Review of Current U.S. Ethanol Production and Ending Stocks 2017
By Sampath Jayasinghe
Decision Innovation Solutions, 11107 Aurora Avenue, Urbandale, IA 50322
U.S. ethanol production was at 1.02 million barrels per day for the week ending May 26, 2017, according to the most recent Weekly Ethanol Plant Production report from the Energy Information Administration (EIA). Figure 1 illustrates weekly production of fuel ethanol (thousand barrels per day) and weekly ending stocks of fuel ethanol (thousand barrels) from May 24, 2013, to May 26, 2017. The ending stocks of fuel ethanol were at 22.763 million barrels for the week ending May 26, 2017.
The most recent production high occurred approximately three months ago during the week ending March 24, 2017 at 1.054 million barrels per day. This was after the previous historical record of 1.061 million barrels per day in the week ending January 27, 2017. Since the week ending October 28, 2016, the weekly production sustained above one million barrels per day through March 31, 2017, a consecutive 23 weeks of record production. Seasonal end of winter plant repairs and maintenance reduced April production. Figure 2 depicts the ethanol production by number of week in each year from January 4, 2013 to May 26, 2017. Notice two seasonal slowdown periods each year at the end of winter and the beginning of fall.
As shown in Figure 2, weekly production has been significantly higher in the January-May 2017 period, compared to the same period in 2016. Weekly winter months’ production in 2017 was 5-8 percent higher than in 2016.
On May 31, 2017, EIA released monthly fuel ethanol production for the first quarter of 2017 (see Fuel Ethanol Supply and Disposition). Figure 3 illustrates the monthly U.S. plant fuel ethanol production in million gallons from January 2014 to March 2017. The U.S. fuel ethanol production in March 2017 was 1.351 billion gallons, 12% higher than the 1.207 billion gallons in February 2017, and a 4% higher than March 2016. On a quarterly basis, the first quarter 2017 production was 3.912 billion gallons, 4 percent higher than the first quarter production 2016.
Figure 4 shows monthly fuel ethanol ending stocks in million gallons from January 2014 to March 2017. The U.S. fuel ethanol ending stocks in March 2017 was 998 million gallons, compared to 967 million gallons in February 2017, a 3 percent increase. Comparing to March 2016, the ending stocks in March 2017 increased by 7 percent.
The March 2017 ethanol ending stocks was the highest ever recorded in the U.S. ethanol market. Ethanol ending stocks by the end of the first quarter 2017 were 2.916 billion gallons, compared to 2.867 billion gallons for the same period in 2016, a very slight increase of 1 percent. The ending stocks to total use ratio is 0.73 in March 2017 based on U.S. Bioenergy Statistics published by the United States Department of Agriculture’s Economic Research Service.
The Short-Term Energy Outlook published by EIA on June 6, 2017 predicts ethanol production will average 1.03 million barrels per day during the third and fourth quarter 2017. Fuel ethanol blending into gasoline during this summer is projected to be 0.956 million barrels per day, compared 0.936 barrels per day during the same period in 2016. Total U.S. ethanol exports during the first quarter 2017 were a record 9.294 million barrels, compared to 5.944 million barrels during the same period in 2016, a significant increase of 56 percent. The 2017 is going to be a record year in the U.S. ethanol market.