Both overseas and domestically, 2017 is shaping up to be a big year for ethanol.
Because China is placing a large import tariff on U.S. dried distiller grains (DDGs) and ethanol, imports will likely drop. That is an area where the Trump administration is trying to negotiate.
According to Ted Seifried, vice president and senior market strategist of Zaner Ag Hedge, Brazil is also a concern because they want to raise import tariffs which are on hold until 2019.
“There’s a big move towards E15 [domestically],” said Seifried.
Sen. Joe Donnelly (D-Ind.) and Sen. Chuck Grassley (R-Ia.) are trying to extend the Reid vapor pressure (RVP) to blends above 10 percent, something that would keep E15 a presence all year long. Seifried thinks if this year these regulations can get passed, there would be a lot of benefits.
“If we can get the blender credits, it’s going to move into retail outlets a lot sooner,” he said. “You really get the feeling that the talk we’ve had about E15 lately seems a lot more positive both in the media and also politically.”
Hear more of Seifried’s comments on ethanol and Mike North, president of Commodity Risk Management Group talk about dairy and the weak dollar on U.S. Farm Report above.