Oregon Rack Gasoline Jumps Nearly 34 Cents in Two Weeks on Ethanol Troubles

March 28, 2019

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by Kenneth Raphael, Jeffrey Bair and Wes Swift (S&P Global Platts) Portland, Oregon, rack gasoline has jumped more than 33 cents since March 12 on ethanol shortages tied to the recent "bomb cyclone" in the US Midwest that set off flooding and interrupted rail movement of ethanol, according to DTN data Wednesday and market sources.

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Shortages in Tucson, Arizona, last week also were blamed on lagging transportation of ethanol, with some Circle K stations in southern Arizona running out of fuel.

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Record-breaking flooding was reported throughout the Midwest earlier this month. Farmers in Corn Belt states have reported crop losses to the tune of 1.34 million bushels of corn that were being held in storage units, the US Grains Council said.

A Nebraska Corn Board representative said flooding had caused an estimated $440 million in damage and there was no clear timeline on when farms might be expected to be resume production.

Flooding in the region has also caused major transportation issues, delaying both the manufacturing of ethanol in the Midwest and its distribution nationwide.

The US West Coast has been dogged by ethanol shortages after parts of the Union Pacific and Burlington Northern Santa Fe railroad networks were blocked by flood waters.

The railroads said portions of the rail lines in Nebraska, Iowa, and Missouri remained impassable as of Tuesday. The outages have kept ethanol shipments bottled up in the US Midwest, where the majority of the country's ethanol plants are located. READ MORE

Look for Corn Prices to Pop as U.S. Floods Cut Supply and New Ethanol Guides Lift Demand (Barrons)

Flooding Impacting Ethanol Plants (WNAX)

FLOODING AFFECTS ETHANOL PRODUCTION (Brownfield Ag News)

Ethanol plants work together as flooding disrupts transportation network (Nebraska TV; includes VIDEO)