Ethanol Price and Profitability Trends Through Late March 2019
By Kansas State University estimates, ethanol plants in Iowa and other Midwest states were operating at losses of $0.10 to $0.29 per gallon from September 2018 through February 2019, but were showing losses of $0.14 / gallon during the first three weeks of March 2019. A moderate increase in ethanol prices in March is the key factor causing the moderation in losses.
During the March 1-22, 2019 period, corn input purchase prices for Iowa ethanol plants averaged $3.53 3/4 /bu (compared from $3.57 /bu in February, and $3.54 in January). Selling prices of distillers dried grains (DDGS) (10% moisture) have averaged $136.78 /ton during the March 1-22 period, down from $155 & $140 /ton in January and February, respectively). The selling price of ethanol via tank car and truck shipment out of Iowa ethanol plants has averaged $1.31 /gallon, up from $1.17 & $1.21 /gallon in January & February, respectively.
During March 1-22, 2019, the estimated cost of production of a representative ethanol plant in Iowa has averaged $1.45 per gallon – comparable to $1.42 per gallon in January and $1.47 in February. This has lead to an estimated negative net return of minus $0.14 per gallon produced so far in March 2019, with is comparable to losses of $0.24 /gallon in January and losses of $0.26 /gallon in February 2019.
Biodiesel Price & Profitability Trends Through Late-March 2019
Reductions have also occurred in the estimated profitability of Biodiesel plants in Iowa and nearby states – although they are still estimated to have in essence broken even during the March 1-22, 2019 period.
During March 1st to 22nd, soybean oil input purchase prices for Iowa biodiesel plants averaged $29.49 per cwt – down from $30.11 /cwt in February. This occurred while Biodiesel selling prices averaged $2.90 /gallon during 3/1-22/2019, being down from $2.96 /cwt in February.
Also during the March 1-22 period, the cost of production at representative biodieselplants in Iowa has averaged $2.90 per gallon – down from $2.84 per gallon February. As a result, net returns of soy biodiesel product were level, or breakeven, with a profit of loss of $0.00 per gallon produced. This is comparable to profits of $0.02 /gallon in February, and breakeven in January.
Following are some graphics on U.S. Ethanol and Biodiesel Market price and profitability trends in the , which will soon be available on the KSU AgManager website: http://www.agmanager.info/
The full presentation titled “U.S. Ethanol & Biodiesel Market Situation” made for WILL (Illinois Public Radio) on Tuesday, March 26, 2019 and will be located at the KSU AgManager.info website – at the following web address: