Market and product

HOUSTON (ICIS)--US spot fuel ethanol prices were assessed much stronger on Wednesday on short-covering, the looming summer driving season and continued railroad transportation issues, pushing prices to their highest levels since June 2006.

Ethanol buyers were very aggressive during the week ended 26 March, as some producers were caught with short supplies.

There was also a heavy buying sentiment in the market as temperatures have turned warmer, signalling the start of the spring and summer driving season.

Additinally, producers continue to struggle getting supplies to the east and west coasts, as a lack of rail cars plagues the industry.

Accordingly, Rule 11 spot ethanol prices, which is ethanol moved by rail, were much higher at $3.84/gal.

These factors overshadowed statistics from the US Energy Information Administration (EIA) showing an increase in supplies and decrease in production.