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Railcar Shortages Push Up Ethanol and Gasoline Prices

Date Posted: March 27, 2014

This article is reprinted from the USDA's March 27 Grain Transportation Report.

According to the Renewable Fuels Association, railcar shortages due to the cold winter and heavy demand for railcar service moving crude oil in the Upper Midwest have resulted in ethanol prices rising sharply—up 80 cents per gallon in the last month.

Producers have had to pay as much as $3,000 to reserve a railcar, with some ethanol plants having to wait 35 to 40 days for a railcar.

Meanwhile, the Energy Information Administration reported ethanol inventories declined for 5 weeks before improving slightly in the week ending March 21.

During the week ending March 21, ethanol prices topped $3.00 per gallon.

As a result of higher prices for ethanol, which is blended into gasoline, the price of gasoline has also increased, according to industry analyst Trilby Lundberg.

U.S. gas prices have increased 26 cents per gallon over the last six weeks.

For more information, call Surajudeen (Deen) Olowolayemo, USDA, at 202-694-3050.

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