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AMIS Market Monitor

last release: February 2019

Ethanol Update

Chart description

Chart description

The ethanol margin gives an indication of the profitability of ethanol production from maize in the United States. It uses current market prices for maize, Dried Distillers Grains (a valuable by-product of maize-based ethanol production) and ethanol, with an additional $0.55 per gallon of production costs. 

  • Ethanol production margins moved further into negative territory in January, having been below breakeven for 6 months.
  • As a result of poor margins, ethanol production has fallen below an annualized production pace of 16 billion gallons.
  • Low oil prices, and associated low gasoline prices, made ethanol less competitive in the domestic fuel market.
  • Maize traded in a narrow range in the month of January as the US government shutdown delayed key market reports, limiting pricing information.