Ethanol Market Update - 11/3/25

Overview

Market Overview

Ethanol futures opened November quietly after ending October with firm nearby strength.
The CU contract settled at $1.7125 for November and Q1 averaged $1.65, keeping the forward curve in backwardation.
The tone remains supported by robust export demand and consistent domestic throughput despite seasonal logistical adjustments.

Liquidity Energy’s model projects EIA ethanol production at 1.128 million b/d, up +1,000 b/d (+0.09%) from Friday’s final October estimate of 1.127 M b/d.
Utilization edged higher to 76.4%, marking the seventh straight week of incremental gains and the strongest run rate since Q2.

Production Metrics

Throughput remains consistent across Iowa, Illinois, and Minnesota, while a few western plants have temporarily slowed for maintenance.
Export demand remains strong, led by active Gulf and Caribbean flows, while domestic blending margins stay positive as gasoline prices ease slightly.

Market Insight

The ethanol curve continues to consolidate with front-end firmness and softening deferred spreads.
Key spreads include:

• Nov/Dec: +5¢

• Dec/Jan: +3.25¢

• Q1/Q2: −6.75¢

Cash markets remain steady:

• Argo Jan: $1.6875 (+4.0¢ vs Feb)

• NYH Dec: $1.8225 (+5.0¢ vs Jan)

• ITT Nov: $1.8225 (+11¢ vs CU)

• R11 Prompt: $1.9325 TWS / $1.9625 NWS

Spot Argo and NYH values continue to maintain a premium over deferred contracts as domestic buyers replenish inventories after a strong export month.

EIA Production Comparison (Week & Month Transition)

✅ Ethanol output is now +0.5% higher than one week ago, maintaining a stable upward trend through the end of October and into November.

October Summary – Month-End Highlights

🔹 October saw one of the most stable ethanol production months in 2025, with minimal week-to-week volatility.
🔹 Utilization averaged just under 76%, while cash markets maintained strong basis levels into month-end.
🔹 Gulf export activity exceeded expectations, with notable shipments to Brazil, South Korea, and the Caribbean.

Futures & Cash Settlements – 11/3

Ethanol CU Contract

Q1: 1.650 | Q2: 1.7175 | 1H: 1.685 | Q1/Q2: −0.0675

EZ/CU Contract

Argo Market

NYH Market

ITT Contract

R11 Prompt

• TWS: $1.9325

• NWS: $1.9625

Technical Picture

Ethanol futures are consolidating in a narrow range between $1.66 and $1.72, maintaining a mild backwardation structure.
Momentum indicators remain neutral with RSI around 48.
The Q1/Q2 spread is flattening slightly, indicating potential stabilization into mid-November.

Summary

Ethanol markets began November on a stable footing following a strong October close.
Liquidity Energy’s latest model projects EIA output at 1.128 M b/d (+0.1%), with utilization climbing to 76.4%.
October averaged 1.123 M b/d, up nearly 1% from September, capping a strong quarter of consistent production and solid export flows.

The market remains backwardated into Q1, reflecting healthy near-term demand and well-balanced supply fundamentals.

Technicals

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