Pacific Ethanol (PEIX) Gains on Stronger Ethanol Prices
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Pacific Ethanol (Nasdaq: PEIX) is having a strong sessions Friday following reports that ethanol prices are up.
Bloomberg-compiled data points to stronger futures prices amid market speculation that the U.S. is worsening the country's supply imbalance.
On Thursday, the Energy Information Administration said ethanol stockpiles were down 0.5 percent to 15.1 million barrels last week. Ethanol's discount to gasoline narrowed by 2.62 cents to 69.68 per gallon earlier on the session. Gasoline prices rose 8.08 cents to $2.7438 per gallon on the NYMEX Thursday.
Several factors are playing into ethanol futures prices. Main points are lower supplies as producers haven't had to compete with imports. Additionally, there also export interest and demand for gasoline that is higher over the same period last year.
Corn prices recently rose 6 cents to $4.23 per bushel, with one bushel being enough to make 2.75 gallons of ethanol.
Last week, it was reported that the U.S. Environmental Protection Agency (EPA) was considering a lower 2014 fuel quota than government officials. The EPA is proposing a range of 15 billion to 15.52 billion gallons for renewable fuels, though the agency would wait until Spring 2014 before issuing a specific quota. The proposal is in-line with an August draft on the issue. The Obama administration's current target is 18.15 billion gallons.
Shares of Pacific Ethanol are up about 15 percent, off of session highs.
Bloomberg-compiled data points to stronger futures prices amid market speculation that the U.S. is worsening the country's supply imbalance.
On Thursday, the Energy Information Administration said ethanol stockpiles were down 0.5 percent to 15.1 million barrels last week. Ethanol's discount to gasoline narrowed by 2.62 cents to 69.68 per gallon earlier on the session. Gasoline prices rose 8.08 cents to $2.7438 per gallon on the NYMEX Thursday.
Several factors are playing into ethanol futures prices. Main points are lower supplies as producers haven't had to compete with imports. Additionally, there also export interest and demand for gasoline that is higher over the same period last year.
Corn prices recently rose 6 cents to $4.23 per bushel, with one bushel being enough to make 2.75 gallons of ethanol.
Last week, it was reported that the U.S. Environmental Protection Agency (EPA) was considering a lower 2014 fuel quota than government officials. The EPA is proposing a range of 15 billion to 15.52 billion gallons for renewable fuels, though the agency would wait until Spring 2014 before issuing a specific quota. The proposal is in-line with an August draft on the issue. The Obama administration's current target is 18.15 billion gallons.
Shares of Pacific Ethanol are up about 15 percent, off of session highs.
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