Ethanol Prices Still Climbing  

November 17th, 2021

As drivers return to the road, ethanol prices are reaching record highs!  


Today’s blog is by Gayl Southard, VP of Administration at SafeSourcing.

As drivers return to the road, ethanol prices are reaching record highs.  Ethanol, the corn-based fuel, is a common gas additive, has risen about 50% in 2021.  The price pushed to over $2 a gallon earlier this year, the first time since 2014.  Gasoline prices are the highest they have been in seven years, averaging $3.41 a gallon as of November 8 reported by the U.S. Energy Information Administration.   The increase equates to $1.31 from last year.  Commodity prices in general have risen.  Agricultural prices have risen as the supply chain has been clogged.  It has been reported that refineries have been producing more fuel but have not been able to keep up with the demand.

At the onset of the COVID-19 pandemic, the production of ethanol fell to all-time low last year as people stayed off the roads, leading to ethanol production to stop and the closure of unprofitable plants.  “ The ethanol margins that we’re seeing right now in the market are extremely healthy,’ said Ray Young, ADA’s chief financial officer, on the company’s  earnings call.  ‘And that is just reflective of a very tight supply-demand situation right now.”1.

Farmers have indicated the price for fertilizers used in corn crops have increased substantially.  This has pressured farmers to plant less corn (a fertilizer intensive crop) in favor of soybeans that use far less fertilizer.

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1. Kirk Maltais, WSJ, 11/11/2021



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