Topic: Wholesale Ethanol Vs Gasoline (Read 721 times)

Jonny Energy · « **on:** January 09, 2010, 10:09:16 AM »

CBOT shows Feb contract for Ethanol at $1.925
RBOB Feb contract for Gasoline at $2.157
Any thoughts

James48843 · « **Reply #10 on:** March 11, 2010, 05:12:18 PM »

Well, at least here in Michigan- today was the day.

Retail gasoline prices spiked up today- a dime just about everywhere.

I filled up on E85 this morning at $2.29, when gas was $2.69.

Tonight, on the way home- every single gas station had jumped a dime on gas price- to $2.79 most places.

But E85 remains at $2.29.

Now with that spread- we should start to see people buying.

Yeehaw- bring on higher gas prices!

rufus · « **Reply #9 on:** March 10, 2010, 11:49:22 AM »

I'm not arguing that with you, Dan. I'm just in a good mood, and looking for the "upside."

Dan M · « **Reply #8 on:** March 10, 2010, 11:29:51 AM »

Quote from: rufus on March 10, 2010, 10:51:16 AM

Crap, I meant to say "Decent PROFITS," not "price spreads."

In a way, narrow spreads aren't as bad of news as they seem. Narrow spreads means the demand for E85 is Good, and more retailers will be tempted to jump in.

Morning rufus ..I am a consumer advocate not a greed advocate for business..especially ignorant greed that accepts short term high margins over long term margins on higher volume

Consumers care about 1 thing.. Price.. if the price spread makes no sense they wont buy.. I just stopped supporting the Station that I usually go to in town because as they upped their fuel prices they narrowed the price spread..

I don't believe they intentionally narrowed the price spread .. I think they simply don't pay attention to it..and wont even notice it until they get ready to order the next shipment of E85 and realize sales are down..

Which was my point about RFA needing to educate the retailers better ..as Gas Prices rise and ethanol prices (wholesale) fall ..they need to translate that same trend AT the pump.

Just Like Renew E85 does . http://e85prices.com/wisconsin.html

rufus · « **Reply #7 on:** March 10, 2010, 10:51:16 AM »

Crap, I meant to say "Decent PROFITS," not "price spreads."

In a way, narrow spreads aren't as bad of news as they seem. Narrow spreads means the demand for E85 is Good, and more retailers will be tempted to jump in.

rufus · « **Reply #6 on:** March 10, 2010, 10:48:32 AM »

On the other hand, Dan, other retailers aren't going to be tempted to "jump in" and start offering E85 if they don't see decent price spreads.

It's kind of a double-edged sword, right?

Dan M · « **Reply #5 on:** March 10, 2010, 10:18:43 AM »

Too many Retailers simply looking at this as an increase in profit margins for themselves instead of increasing the price spread..

This is where the RFA needs to step up and "REMIND" retailers that increasing their price spread will mean MORE volume and more profits ..

instead of accepting the same amount of volume but higher margins (short term profits)

rufus · « **Reply #4 on:** March 10, 2010, 10:11:54 AM »

First "Bullish" EIA Report in a while. We're still continuing to ramp up our gasoline use. The last few reports have gone frome 8.6 million barrels of gasoline supplied/day (up from about 8.4 mbpd a couple of months, ago,) to 8.7mbpd, 8.8 mbpd, to last weeks 8.9 million bpd.

Looks like unleaded wholesale will got to $2.30, today which translates out to about $3.00 gal at the pump (if it holds for a couple of weeks.)

Meanwhile, you can buy a gallon of ethanol in Chi town for $1.61

THIS is what we need. Every business I've ever been in Price is what made the mare run.

rufus · « **Reply #3 on:** January 09, 2010, 11:30:03 AM »

Then they need to get off their country-bumpkin asses, and get out there and do some "Retailing." Along the lines of "Renew," and "Pearson Fuels."

cessna · « **Reply #2 on:** January 09, 2010, 11:04:14 AM »

A friend of mine on the board of directors of an ethanol plant says the CBOT price has nothing to do with what the ethanol plant gets---meaning the plant usually gets less. Seems there could be a good spread if we could get the middle man out of the picture.

1outlaw · « **Reply #1 on:** January 09, 2010, 11:01:26 AM »

In the RBOB run up of the last few days ethanol has not followed much, if any. Not to mention that the gasoline spots and terminal prices have outdone even the RBOB. This is widening the spread of ethanol to the real gas markets. This is the effect of all the ethanol plants that were off-line are back on line (plus the last of the new ones that were under construction) at the same time that oil refineries are down to about 80% utilization. No more corn ethanol plants are scheduled- only biomass types from here on out to my knowledge. Gasoline demand is in the tank due to the economy and ethanol's displacement of the gas.