Inside Futures
Monday, April 27, 2009
by CRB Research Team of Commodity Research Bureau
The ethanol market this week will focus on:
- the EIA ethanol report for February, which will put an official number on the recent drop in ethanol production,
- corn prices, which are keying on spring planting weather,
- gasoline prices, which are keying on demand and inventory levels, and
- any news about when the 12 idled ethanol plants formerly owned by VeraSun will come back on line.
May CBOT Ethanol futures prices recovered from last Wednesday's 6-week low and closed the week just slightly lower by 0.4 cents at $1.570 per gallon. The main bearish factor was the 3.4% sell-off in gasoline prices. Bullish factors included (1) slightly higher corn prices, (2) last week's 1.5% sell-off in the dollar index, and (3) last Friday's report by the US Federal Highway Administration that U.S. motorists increased their average daily driving by +2.7% in February, the first increase in the last 15 months. In addition, the weekly DOE report showed that implied fuel demand in the week ended April 17 rose +2.1% w/w and was up +5.7% from mid-January.
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