BioFuels Journal

The estimated production margin for a typical US Midwest dry-mill ethanol plant rose 9.38 cents, or 19.7%, to 57.03 cents/gal, rebounding from a 14-month low, a review of US Department of Agriculture and Platts data showed Friday.

The margin reversed course on a seven-week decline as rising ethanol prices outweighed slightly more expensive feedstock corn prices.

The estimated ethanol price used in calculating the margin was the weekly average of the Platts Chicago Argo ethanol assessment, which added 12.11 cents, or 7.73%, to $1.6882/gal, up from a six-year low for a second straight week.

The weekly average estimated delivered feedstock corn cost moved up 5.96 cents, or 1.88%, to $3.2365/bushel, up from a five-year low for a second straight week.

Additionally, the weekly average estimated dried distiller grain byproduct price moved down $2.27 to $99.76/st, dipping below $100/st for the first time since 2010.

The estimated denaturant cost shed 11.9 cents to a four-year low of $1.6455/gal, while the estimated monthly natural gas cost was unchanged at $4.09/MMBtu.

The denaturant cost was based on the weekly average of the Platts natural gasoline assessment at the Conway, Kansas, hub, while the gas cost was based on the October Platts Chicago ANR 7 pipeline monthly index.

The estimated production margin for a typical dry-mill ethanol plant was calculated by weighing data from Platts and government agencies, including average delivered corn cost, dried distiller grain prices, natural gas prices, certain blending costs and ethanol prices.

Fixed-cost calculations were based on a 50 million gal/year-capacity Midwestern plant with 32 employees working at an average salary of $47,300/year.

For more information, please contact Jordan Godwin at Jordan.Godwin@platts.com

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