EIA increases 2016 ethanol production outlook

The US Energy Information Administration (EIA) has predicted that ethanol production will average 970,000 barrels per day in both 2016 and 2017 in the US.

The organisation published the information in the January issue of its 'Short-Term Energy Outlook'.

The EIA has increased its prediction for 2016 when compared to the 960,000 barrel per day prediction included in the December Short-Term Energy Outlook. The January report includes EIA's first short-term predictions for 2017. Ethanol production averaged approximately 964,000 barrels per day last year.

Ethanol consumption, which averaged 910,000 barrels per day last year, is expected to average 930,000 barrels per day this year and next year.

According to the EIA, this level of consumption results in the ethanol share of the total gasoline pool averaging 10% in both 2016 and 2017. EIA said it does not expect significant increases in E15 or E85 consumption over the forecast period.

According to the EIA, biodiesel production averaged 85,000 barrels per day last year, and is expected to average 107,000 barrels per day this year and 112,000 barrels per day next year. Net imports of biomass-based diesel are also expected to increase, from 28,000 barrels per day last year to 47,000 barrels per day in both 2016 and 2017.

The price of US retail regular gasoline is expected to average $2.03 per gallon this year and $2.21 per gallon next year, compared with $2.43 per gallon in 2015. In December, EIA said average retail gasoline prices were $2.04 per gallon, down 12 cents per gallons from November and 51 cents gallon when compared to December 2014.

EIA expects monthly gas prices to reach a seven year low of $1.90 per gallon in February 2016 before rising during the spring.

The EIA's most recent weekly ethanol production numbers show production averaged 1.003m barrels per day the week of 8 January, 2016, up from 996,000 barrels per day the week of 1 January.