The New York Harbor-Houston ethanol spread hit 3.9 cents Thursday, the widest level since being assessed at a 4.5 cent spread on October 30, Platts data showed.
The two products, which typically trade at 1-2 cent spread with one another, have shown a volatile relationship since December 9, when the US Energy Information Administration released weakly ethanol production and inventory statistics.
The report highlighted ethanol stock builds in the Gulf Coast PADD III, up 57,000 barrels to 4.028 million barrels, while East Coast PADD I stocks fell 202,000 barrels to 6.370 million barrels.
"I think Houston was building volume for exports, and haven't sent it out yet" said a US ethanol broker. Another broker agreed, adding that if the exports fell through, possibily due to a shipping issue, they would just hold product until the next round of exports in January.
The ethanol broker said it was "most likely" the widened spread could continue into the new year. "Seems like guys are gonna sit tight until next year on most of this stuff."
