US Ethanol Prices Poised to Surge as Iran War Sparks Export Spike

The US ethanol market moved into firmer territory toward the end of February, supported by stronger demand from the transportation fuel sector, rising export activity, and short-term supply disruptions at several domestic production facilities. During the early part of the month, market activity remained relatively balanced as stable input costs and steady production limited volatility. However, momentum strengthened in the second half of February as fuel blenders increased procurement and export orders accelerated, tightening prompt supply availability and pushing ethanol prices upward across key trading hubs.

In early March, market participants are expected to increasingly monitor the geopolitical situation in the Middle East, particularly the escalating tensions involving Iran and the United States. The conflict has already pushed global crude oil prices higher and raised expectations of increased gasoline prices in the United States. If energy prices continue to climb, ethanol blending economics are...