Ethanol Prices Soften on Inventory Gains

Corn futures adjusted higher Wednesday, as moderate to strong gains in all nearby and most deferred contract months offset most, if not all, of early week losses. The stability in energy and financial markets following wide swings over the past few days seems to have created renewed fundamental buyer support through corn trade. Technical support also slowly developed through the last half of the session, with prices rallying back above the 50-day and 100-day moving averages.

May corn closed up 8 1/4 cents per bushel at $4.51 1/4 and July corn was up 8 cents at $4.60 1/2. The Energy Information Administration reported on Wednesday that last week’s ethanol production averaged 1.120 million barrels per day (bpd), an increase of 4,000 bpd from the prior week. Production has outperformed seasonal expectations through April thus far, typically a time of year where production slides as plants take maintenance while producers are busy with fieldwork. Year-to-date ethanol production is now running 2% ahead of the same point in 2025 (through the corn marketing year). Ethanol margins remain stellar, with USDA reporting a $2.95 gross margin in Iowa, the highest weekly average since November 2022 and about $1.50 ahead of this point last year.

“In world corn news, the situation in Brazil is growing more crucial, with not much for rainfall expected over the next week and the last week of April featuring isolated fronts. The wet season in Brazil typically ends in early May, but that may have started early this year and be problematic for safrinha corn. Meanwhile, heavy rainfall in Argentina is likely no longer much benefit to the corn crop, and more of a hindrance to harvesting efforts. However, this crop will be important to monitor given the large disagreement between agencies, with a 15 million metric ton (mmt) gap between USDA and the Rosario Grain Exchange as one example. The DTN National Corn Index finished Tuesday at $4.06. Wednesday’s futures close and Tuesday’s national average corn basis of 37 cents under the May board would indicate the index on Wednesday afternoon to be near $4.15,” stated DTN Lead Analyst Rhett Montgomery.

Ethanol futures continued lower Wednesday, following the latest EIA report and overall lack of market volatility in energy trade through the middle of the week. April ethanol futures posted a 1.25 per gallon loss, closing at $1.9175 per gallon. May contracts slipped 1.75 cents per gallon, at $1.91 per gallon. The lack of price spreads between May and August contracts remains extremely narrow, with a 3-cent price spread between all spring and summer contract months. The focus on potential production stability and stable demand could limit additional market swings over the next few months. With increased ethanol production reported in the latest EIA report, the ability to keep production levels nearly 2% above year-ago levels could limit aggressive market support in the near future.

Cash ethanol prices slipped lower following softness in futures trade and inventory gains seen in the latest EIA report. The national average rack price fell 0.046 cent per gallon to $2.2656 a gallon. Rack ethanol prices were mixed in a moderate trading range. In several markets, fractional market shifts are being seen, while in other markets, traders are still trying to adjust to recent market moves Wednesday. Spot ethanol prices are lower Tuesday afternoon. East Coast markets posted losses of 1 cent per gallon, while Midwest prices were 1 to 1.5 cent lower per gallon. Prices are $1.895 to $1.915 per gallon in the Midwest, and $1.98 per gallon on the East Coast. RIN price levels are higher. Current 2026 RIN Prices are 0.6 cents higher at $1.7330 per gallon, 2025 RIN prices are 2 cents higher at $1.72 per gallon.

Crude oil futures remained essentially flat Wednesday following a week of extreme market volatility in all energy markets. May crude oil futures gained just 1 cent per barrel, moving to $91.29 a barrel, while June contracts were the only contracts moving lower with a 6-cent per barrel loss, falling to $88.13 per barrel. In the latest Energy Information Administration report released Wednesday, crude oil inventories in the U.S. unexpectedly decreased in the week ended April 10th. Crude oil inventories edged down by 0.9 million barrels last week after climbing by 3.1 million barrels in the previous week. Economists had expected crude oil inventories to inch up by 0.2 million barrels. At 463.8 million barrels, U.S. crude oil inventories remain about 1 percent above the five-year average for this time of year, the EIA said.

RBOB gasoline futures moved higher midweek, but the volatility in the market and market swings seem to have calmed significantly following traders’ focus on the potential that tensions in the Middle East may be settling a bit for now. Given the uncertainty and overall production levels through the upcoming months of oil in the Middle East, this is expected to still be a hot topic and create market volatility over the near future. May futures continue to hold above $3 per gallon, closing 2.97 cents per gallon higher at $3.0692 a gallon. June futures are also trading at $3.0051 per gallon with a 3.47-cent per gallon gain.