Even though USDA’s latest crop forecast says we’re going to have a record corn harvest of almost 17 billion bushels this year, corn prices here lately have been on the rise due to the rise in ethanol demand.
As of Tuesday, Sept. 16, the December corn contract closed at $4.29 1/2 per bushel, which is an increase of $0.35 per bushel since the close of trade on August 12 ($3.94 1/2 per bushel).
Seth Meyer, Chief Economist with USDA, says there are a couple of reasons why corn futures have been climbing higher recently.
“They’re pushing a lot of that corn into ethanol production. We had a record corn export program last year. And we actually reduced carryout stocks this month for the coming crop year, or the current crop year, because we raised exports.”
The U.S. Energy Department says ethanol exports were up 36 percent by the first week of September, having earlier crossed the 1 billion-gallon threshold.
Troy Bredenkamp, Vice President of Government and Public Affairs with the Renewable Fuels Association, says it’s important to continue pushing your lawmakers to approve the year-round nationwide sales E-15, in order to give a further boost to corn and ethanol demand.
“You’re going to add at least six billion gallons of new ethanol demand to the American fuel market,” according to Bredenkamp. “That certainly helps soak up a lot of this carryover, and this massive crop that’ll be coming in this fall.”
Bredenkamp says six billion gallons of ethanol would soak up two billion more bushels of corn.
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