- U.S. ethanol producers and traders foresee a bleak spring as sinking prices and soaring inventories hit margins, forcing some companies to suspend loss-making output and extend maintenance, Reuters reports from the Renewable Fuels Association conference.
- Mark Fisler of Ocean Park Advisors said if ethanol producers keep pumping out fuel at the same levels seen in January, production would swell to more than 15B gallons, ~800M gallons more than needed.
- Inventories reached a record 23M barrels in the week ended Feb. 5, but traders said the total could go even higher before plants began to shut down in late March for maintenance and warm weather attracts drivers back to the road.
- Stockpiles likely will hit fresh records, executives said, pushing margins to or below breakeven costs for many producers and forcing some of the majors such as Green Plains (NASDAQ:GPRE) and Archer Daniels Midland (NYSE:ADM) to slow output.