WASHINGTON, D.C. –U.S. ethanol production hit an all-time high the week ending July 26, with production averaging 1.109 million barrels a day, up 14,000 on the week, and 42,000 on the year, the highest in nearly seven years. 

The report from the U.S. Energy Information Administration, said this is up slightly from the previous record of 11.08 million barrels per day set in December 2017.

“Both fuel ethanol production and stocks were up 1 percent when compared to the previous week, while exports were up 2 percent,” the report said.

Jimmy Troderman, a U.S. Energy Information Administration petroleum industry economist, told Farm World, “It is common to see high ethanol production around the summer driving season.

“We are seeing even higher production this year, compared with past years, and that could be due to a few possible reasons,” he said. “One is that ethanol production has likely become more attractive as corn prices have come down, leading to a more favorable corn crush spread.”

He said a second possible reason is there is increased capacity to supply ethanol.

“U.S. ethanol production capacity is higher than the past few years, emergency fuel waivers have allowed for nationwide E15 this summer, and there has been a trend toward more retail stations offering higher ethanol blends, such as E15 and E85,” he said.

He said, “A third possible reason is that we have recently seen gasoline consumption increase. While we aren’t seeing anywhere near record gasoline demand, it is noticeably higher than it has been most of this year.

“All these factors could combine to create an environment of higher demand for ethanol,” he said. “It is important to keep in mind, however, that we are only talking about a few weeks of high ethanol production, and that most weeks since April have seen much lower production levels than in 2019.”

In fact, according to the U.S. Energy Information Administration, the week ending Aug. 2, production averaged 1.067 million barrels a day, down 42,000 from the previous week’s all-time high, but up 44,000 from a year ago.

Scott Richman, Renewable Fuels Association chief economist in Ellisville, Mo., told Farm World, overall, record-high weekly ethanol production, as seen in late July, reflects strong domestic and international demand.

“In the domestic market, gasoline usage this summer has been on par with 2023, while sales of E15 (15 percent ethanol and 85 percent gasoline blendstock) have continued to expand, facilitated by EPA waivers (in August 2023),” he said. “Internationally, exports for the first half of 2024 were 41 percent higher than the same period last year, and shipments are on pace to break the annual record set in 2018.”

When asked how this record increase in ethanol production benefits U.S. farmers, he said, “Increased usage of corn is vitally important to growers. A large crop is about to be harvested, and corn prices are at multi-year lows, with December futures recently trading below $4 per bushel.”