24 October 2012 22:36 [Source: ICIS news]
HOUSTON (ICIS)--US industrial ethanol contracts for the fourth quarter settled flat on Wednesday from the prior quarter as producers were unable to push through the remainder of a previously announced increase.
The fourth-quarter contract for 200 proof ethanol settled at $4.12-4.22/gal, while 190 proof settled at $3.92-4.02/gal.
On 1 August, an increase of 75 cents/gal was announced for the third and fourth quarter, but only half of it was implemented in the third quarter.
“We were waiting for someone to push it up, but it never happened,” a producer said of the proposed 75 cent/gal increase.
A buyer said their price for the third quarter was fixed, so the 75-cent/gal increase did not apply.
“Our actual fourth-quarter increase was about 40% less” than what was implemented in the third quarter, the buyer said.
Regardless, a source said price increases have not kept up with the rising cost of corn, the primary feedstock for ethanol.
“It’s going to be a tough year sourcing corn,” a producer said. “Corn is scarce and probably the lesser known story is the corn quality is poor.”
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