Ethanol Market Update - 12/16/25

Market Overview

Ethanol futures eased modestly to start the week, with CU December settling at $1.6525, down slightly from last week’s highs as the market continues to digest softer near-term demand and seasonal headwinds. While outright values drifted lower, the curve remains orderly, and structure continues to reflect a balanced supply backdrop rather than any outright oversupply concern.

Front-month weakness has been largely contained to the nearby contracts, with deferred months holding in relatively well. Calendar spreads softened marginally, but remain historically firm for mid-December, suggesting commercial participation is still present on dips.

Production & Fundamentals

Production through mid-December remains steady overall, with no widespread disruptions reported across the Midwest. Utilization appears stable following the post-holiday normalization period, and logistics have improved after recent congestion.

Key fundamentals remain mixed but controlled:

• Corn inputs are steady, offering limited margin relief

• DDG values remain rangebound

• CO₂ demand is seasonally soft

• Export flow continues but lacks urgency compared to October and early November

Overall, the production side continues to “hold the line,” preventing sharper downside pressure despite softer spot demand.

Market Insight

The forward curve remains gently backwardated into Q1, though the structure has softened slightly:

• Dec/Jan narrowed to +7.25¢

• Q1 average: $1.60

• Q2 average: $1.675

• Q1/Q2: −7.5¢

The 1H average sits at $1.6375, reflecting a market that has cooled from recent highs but remains well supported relative to historical seasonal norms.

Argo and NYH values tracked futures lower, maintaining consistent basis relationships with CU.

Futures & Cash Settlements – 12/15

Ethanol CU Contract

Q1: 1.60 | Q2: 1.675 | 1H: 1.6375

Argo Market

NYH Market

ITT Contract

Technical Picture

Technically, ethanol remains rangebound after failing to extend beyond recent resistance near the upper $1.60s. Support now sits around $1.58–$1.60, while resistance remains layered near $1.68–$1.70.

Momentum has cooled but has not broken down, and the curve structure continues to suggest consolidation rather than capitulation.

Summary

Ethanol futures softened modestly to start the week, with CU December settling at $1.6525 as the market continues to work through seasonal demand headwinds. Despite the pullback, the curve remains well structured, production is steady, and downside pressure remains controlled.

The market tone remains cautious but stable, with participants focused on year-end positioning and any shifts in export flow or blending economics heading into late December.

A clearer directional signal is likely to emerge as liquidity improves post-holiday and Q1 demand visibility sharpens.

Technicals

Enjoyed this article?

Subscribe to never miss an issue. Daily updates provide a comprehensive analysis of both the fundamentals and technical factors driving energy markets.

Click below to view our other newsletters on our website:

Daily Market Update

Natural Gas Daily Update

Fuel and Freight Daily Report

Disclaimer

The Coolidge Report is published by Coolidge Shop LLC and is intended for informational purposes only. This report does not constitute trading recommendations, financial advice, or an offer to buy or sell any commodity. While efforts are made to ensure accuracy, Coolidge Shop LLC makes no warranties regarding completeness or reliability. Coolidge Shop LLC is not registered as a Commodity Trading Advisor (CTA) with the CFTC, and this report should not be interpreted as a solicitation to engage in futures or derivatives trading.

This article and its contents are provided by Liquidity Energy, LLC ("The Firm") for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC