Ethanol Market Update - 12/29/25

Overview

Market Overview

Ethanol futures reopened after the Christmas break with little follow-through, as values continued to grind sideways in thin, holiday-impacted trade. With most commercial participants operating at reduced capacity last week, price discovery remained limited and largely technical.

The forward curve remains modestly backward, though spreads continue to compress across Q1, reflecting adequate nearby supply and muted winter demand. Despite the softer tone, the market remains orderly, with no signs of forced liquidation or stress across either futures or cash markets.

Production Update

U.S. ethanol production remained stable through the holiday period. Liquidity Energy’s internal model shows output holding near recent averages, with utilization largely unchanged.

• Estimated Production: ~1.13 MMbpd

• Utilization: ~76–77%

• Operating Environment: Stable; no widespread outages reported

Seasonal slowdowns are typical this time of year, and any near-term reductions are expected to be modest and temporary as plants move through year-end maintenance and holiday staffing schedules.

Futures & Curve Structure

Ethanol CU – 12/26 Settlements

Q1 Avg: ~1.60
Q2 Avg: ~1.68
Curve Structure: Modestly backward, flattening

Front-end spreads remain backward but tight, consistent with a well-supplied nearby market and limited urgency from blenders.

Cash Markets

Cash markets remained quiet over the holiday week, tracking futures without notable dislocations.

• NYH premiums held steady, reflecting balanced East Coast logistics

• Midwest and Gulf markets saw limited activity due to holiday scheduling

• Argo values continued to move in line with the board

No material regional stress was observed.

Market Insight

The ethanol market enters the final days of the year in consolidation mode. Q1 values continue to soften marginally relative to Q2, but the curve remains structurally intact and supported by stable production and consistent export demand.

With most participants focused on year-end positioning rather than new risk, near-term trade is expected to remain technical and spread-driven until liquidity improves in early January.

Technical Picture

• Support: $1.58–$1.60 (Jan)

• Resistance: $1.70–$1.72

Momentum remains neutral, with declining volatility and compressed spreads signaling balance rather than directional conviction.

Summary

Ethanol futures closed the holiday week quietly, with CU Dec settling at $1.655 and the forward curve continuing to flatten modestly. Production remains stable, cash markets are orderly, and price action reflects a comfortable supply environment heading into year-end.

As the market transitions into 2026, attention will shift to post-holiday demand normalization, export flows, and early Q1 blending economics.

Technicals

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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.

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