Key Highlights

  • Chicago ethanol was quoted at US$2.07 per gallon on October 12, up 2.86%.
  • Ethanol production reached 1,053 thousand barrels a day in the week ending October 2.
  • Ethanol stocks stood at 23.7 million barrels, down from 25.2 million on September 11.
  • Green Plains' adjusted EBITDA of US$93.3 million included US$58.7 million of 45Z credit value.

Chicago Ethanol Rises to US$2.07 a Gallon

Chicago ethanol was quoted at US$2.07 a gallon on October 12, 2026, up 5.75 cents, or 2.86%, according to market data, the latest ethanol figure in the data. It is up 3.76% on the week, down 0.48% on the month and 30.39% higher year to date. The CME Group Chicago Ethanol contract is cash-settled against a price assessment, with a size of 42,000 gallons, so traders receive no physical ethanol; the October contract was quoted at US$2.0675 on Friday, October 9, down 1.75 cents from the prior settlement of US$2.0850.

Supply and Stocks

EIA weekly data show fuel ethanol production of 1,053 thousand barrels a day in the week ending October 2, up from 1,007 the week before. Ethanol stocks stood at 23.7 million barrels, down from 25.2 million on September 11. EIA's next weekly report is due October 15, delayed by the October 12 federal closure.

Policy Backdrop

The Environmental Protection Agency issued an emergency E15 waiver on March 25, effective May 1, and finalized Renewable Fuel Standard volumes for 2026 and 2027 at the highest levels in the program's history. The rule took effect on June 15.

Energy Prices and Gasoline

Ethanol is blended into gasoline, so fuel markets matter. EIA's October outlook says retail gasoline averaged US$4.35 a gallon in September, and its Today in Energy service reports tight global gasoline supply since May. As an arithmetic comparison only, a US$92.70 barrel of WTI is about US$2.21 a gallon, near ethanol's US$2.07, though the fuels differ in energy content, location and quality.

ADM's second-quarter release attributes strong ethanol margins to blending obligations, elevated global energy prices and lower corn prices. EIA weekly data also show total motor gasoline stocks of 204.7 million barrels on October 2, little changed from 204.4 million a week earlier but below 207.7 million on September 11.

Producers and Refiners

Green Plains (NASDAQ:GPRE) is a pure-play producer. Its second-quarter net income was US$67.1 million and adjusted EBITDA US$93.3 million, including US$58.7 million of 45Z production tax credit value, on 160.7 million gallons of ethanol sold. Its crush margin rose to US$95.1 million, and it sold ethanol from eight operating plants at 88% utilization. Because US$58.7 million of its adjusted EBITDA came from tax credit value, policy matters as well as price.

Valero (NYSE:VLO) is mainly a refiner, but its ethanol segment earned operating income of US$318 million on 4.67 million gallons a day and a margin of US$1.15 a gallon, against refining income of US$4.47 billion and group net income of US$3.72 billion. ADM (NYSE:ADM) has ethanol exposure through Carbohydrate Solutions, where Vantage Corn Processors profit rose to US$85 million from US$33 million while total segment operating profit was US$1.45 billion.

Outlook: E15 Waivers, Crude Oil and the October 30 Expiry

Factors that could support prices include firmer gasoline markets, strong blending and export demand and steady policy support. Factors that could weigh include higher production, rising stocks, a lapse in the E15 waiver or a fall in crude oil. The October contract expires on October 30.

In short, producers care about the margin between ethanol and corn costs more than the ethanol price alone, and a lower price does not automatically hurt earnings.