EIA increases ethanol production forecast May short-term outlook

By Erin Voegele | May 08, 2014

The U.S. Energy Information Administration has slightly increased its ethanol production forecast for this year in the May issue of its Short Term Energy Outlook.

The EIA now predicts ethanol production will average 911,000 barrels per day in 2014, up from the 908,000 barrel per day forecast made in April. Since December, the monthly production estimate has fluctuated from a low of 900,000 barrels per day made in the December STEO to a high of 913,000 barrels per day made in the January STEO.

In its most recent short-term outlook, the EIA noted that railroad delays due to extreme winter temperatures in the Midwest contributed to sharp ethanol price increases across the U.S. in February and March, particularly on the East Coast. These rail constraints have since eased and ethanol production increased from an average of 890,000 barrels per day in March to more than 910,000 barrels per day in April.

Moving into 2015, ethanol production is currently forecast to average 922,000 barrels per day.

Biodiesel production reached 104,000 barrels per day in December, and fell to 54,000 barrels per day in January. Biodiesel production averaged 89,000 barrels per day last year and is forecast to average 84,000 barrels per day this year. Next year, production is expected to increase to 86,000 barrels per day.

Retail gasoline prices are expected to average $3.61 per gallon during the summer driving season, which runs from April through September. This is a 3 cent increase over last year’s average and a 4 cent increase from the estimate made by the EIA in is April STEO. The projected monthly national average regular gasoline retail price is expected to fall from $3.72 per gallon in May to $3.51 per gallon in September. EIA expects regular gasoline retail prices to average $3.48 per gallon this year, dropping to $3.39 per gallon in 2013.

The EIA’s most recent weekly ethanol production data indicates 894,000 barrels per day of ethanol was produced the week of May 2, down slightly from the 989,000 barrel-per-day average the prior week.

The EIA’s most recent monthly ethanol export data shows 1.605 million barrels of fuel ethanol were exported in February, a drop from the prior month’s export level of 2.054 million barrels. Weekly ethanol import data shows no ethanol imports for the week of May 2.