The U.S. Energy Information Administration (EIA) has raised its forecasts for fuel ethanol production for 2024 and 2025, although it has slightly decreased the 2024 blending outlook. The U.S. Department of Agriculture (USDA) has kept its corn usage for ethanol steady, expecting a modest increase in production and lower prices for the 2024-25 period.
In its latest Short-Term Energy Outlook, the EIA projected that average fuel ethanol production will hit 1.04 million barrels per day in 2024, up from an earlier estimate of 1.03 million barrels. For 2025, the forecast was also increased to 1.03 million barrels per day, compared to the previous 1.02 million barrels. For context, fuel ethanol production averaged 1.02 million barrels per day in 2023.
On a quarterly basis, the EIA anticipates that production will average 1.06 million barrels per day in the third quarter of this year, tapering off to 1.04 million barrels in the fourth quarter.
Looking ahead to 2025, the projections indicate an average of 1.04 million barrels per day in the first quarter, followed by 1.03 million in the second quarter, and a slight dip to 1.02 million in the third quarter, before rebounding to 1.04 million barrels in the fourth quarter.
Regarding blending, the EIA now expects an average of 920,000 barrels per day in 2024, a decrease from the previous forecast of 930,000 barrels. However, it maintains the blending estimate at 930,000 barrels per day for 2025. In 2023, blending averaged the same figure.
The EIA also predicts that net fuel ethanol imports will average 110,000 barrels per day in 2024 and 100,000 barrels in 2025, up from 90,000 barrels per day in 2023.
Meanwhile, the USDA has not changed its corn use forecast for ethanol, which stands at 5.45 billion bushels for 2024-25, as reported in the latest WASDE report. The outlook indicates reduced supplies and slight declines in ending stocks.
Projected beginning corn stocks for 2024-25 are expected to drop by 55 million bushels due to increases in exports and ethanol use in 2023-24. Corn production for the upcoming cycle is now forecast at 15.2 billion bushels, reflecting a 39 million bushel increase from August, attributed to a higher yield estimate of 183.6 bushels per acre.
The harvested area for grain remains steady at 82.7 million acres, with total U.S. corn usage unchanged at 15 billion bushels. However, the anticipated season-average price for corn received by producers has been lowered by $0.10 to $4.10 per bushel.
