KANSAS CITY, Missouri (Reuters) - U.S. ethanol production slipped 1.8 percent last week though output levels remained well above last year’s average.
The Energy Information Administration said on Wednesday that U.S. ethanol production totaled 879,000 barrels per day in the seven days to September 9, down 17,000 barrels per day from the previous week.
Based on a four-week rolling average, production volume came in at 892,000 barrels a day, up nearly 4 percent over the same time a year earlier. Weekly production also showed a rise from 872,000 barrels per day a year ago.
Ethanol stocks totaled 17.16 million barrels, up from 17.1 million barrels the previous week, the EIA said in its weekly report. A year ago, stocks totaled 17.9 million barrels.
Ethanol production has remained strong in the United States despite high corn prices because profit margins have remained healthy for most plants. Good domestic and export demand helped fuel output, experts said.
“Plants are making some money. People are feeling pretty good about things,” said Chuck Woodside, general manager of farmer-owned KAAPA Ethanol in Nebraska and chairman of the Renewable Fuels Association.
“I anticipate we’re not going to see a huge reduction in demand,” he said.
U.S. exports of ethanol, mainly to Canada and Brazil, hit a record 127.4 million gallons in July and are on pace to reach 900 million gallons by the end of the year.
The United States will likely surpass Brazil as the world’s largest ethanol exporter for the rest of 2011, the EIA said.
“Export demand is still and should remain pretty strong,” said industry analyst Tom Waterman, who publishes The Ethanol Monitor newsletter.
Chicago Board of Trade corn futures have been rising on strong demand and tight supplies ahead of harvesting of the new U.S. crop. On Wednesday, the benchmark CBOT December corn futures contract was up 2-1/2 cents at $7.25-1/2.
Ethanol futures on the Chicago Board of Trade also gained, with the spot month up 0.002 cent at $2.737 per gallon.
Editing by Dale Hudson