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Floods Threaten to Cause Ethanol Disruptions and Higher Pump Prices

Floods Threaten to Cause Ethanol Disruptions and Higher Pump Prices
By Mario Parker and Michael Hirtzer
Updated on March 22, 2019, 2:51 PM CDT

Flood waters spilling across the U.S. Midwest have swamped ethanol shipments, disrupting refineries and threatening to push up gasoline pump prices ahead of the summer driving season.

Last week’s major winter storm sent the Missouri River and its tributaries over rail lines across the central U.S., interrupting deliveries of the corn-based biofuel and prompting trade group Growth Energy to ask Transportation Secretary Elaine Chao for help.

“It is imperative that all possible actions be taken by the nation’s railroads to ensure that these critical fuel supplies are immediately prioritized and reach markets as quickly as possible,” the group wrote in its letter to Chao.

On Friday, gasoline futures on the New York Mercantile Exchange reached the highest since October. The loss of ethanol -- which is blended with refinery-made fuel to meet environmental requirements in some parts of the country and to boost octane -- will further tighten supply that was already reduced by upsets at refineries from New Jersey to Texas to California... FULL ARTICLE

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