The Market is miss allocating resources.

Ethanol is NOT Gasoline.. it's an Octane.. the CHEAPEST, Safest Octane on the market right now.

Yesterday I showed that we could run on ethanol stocks for 22 to 29 weeks.. however we are NOT going to Drain Stocks to ZERO.

Leaving at least a third.. means we can coast for.. a couple months.

However what does that do to the FEED Side of an Ethanol plant?

The Story of Two Companies from San Antonio..

Valero.. is declaring Force Majure on DDGs Contracts leaving it's customers in the Lurch..

https://www.agra-net.com/agra/world-ethanol-and-biofuels-report/analysis/company/united-states---valero-shuts-ethanol-plants-declares-force-majeure-due-to-virus--1.htm

Meanwhile H E B is a grocery store chain who lies in Hurricane Alley and thinks strategically about supplies.. doing a good job.

https://www.texasmonthly.com/food/heb-prepared-coronavirus-pandemic/

We’ve been working very hard right now to deliver meat and poultry and eggs to our stores. We’re accelerating opening a new warehouse in Houston that was due a few months later. We’re taking some of our warehouses in the state and transitioning them over to serving just meat, because we’re seeing such significant demand for meat, poultry, and eggs. We’re still having a real hard time sourcing eggs. We had big loads in the last few days, and they’ve been scooped up as soon as they hit the shelves, so we’re working very hard with egg suppliers to see where we can get additional eggs. But our meat plant is running 24/7—we have our own meat plants here. They normally don’t go 24/7, but we’ve focused them down to serving the top fifty items out of our meat plants; they normally carry several hundreds. [Focusing on top items] means fewer changeover delays, and it allows us to ship significantly more meat. We’re seeing those kinds of moves across the board as we look to ramp up volume in a rapid way.

So HEB is going full bore delivery Meat, Poultry and Eggs.. while up the chain.. Feedlots, Poultry producers, Dairies etc.. are being SHORTED DDGs because of What VALERO is doing..

which I don't think is RIGHT.

Valero DO YOUR JOB!!!!!

more in the next post.