Ethanol Demand Rises with Summer Travel Boom

E15 Gasoline Gains Traction as Drivers Hit the Road

A surge in summer road trips is driving up ethanol demand in the United States, offering a timely boost to corn farmers and renewable fuel producers. With gas prices low and favorable production economics, ethanol blending is reaching record levels.

This season’s travel is expected to hit historic highs. According to AAA, 61.6 million people are driving during the Independence Day holiday, a 2.2% increase from last year. Memorial Day travel also set records with 45.1 million vehicle travelers. The main reason? Cheap fuel.

Ethanol, a corn-based fuel additive, is becoming even more popular due to the availability of E15, a gasoline blend with 15% ethanol. Although E15 was previously restricted during summer over smog concerns, the Environmental Protection Agency (EPA) approved year-round sales this year, giving drivers access to a cleaner and more affordable fuel.

“Given the significant demand and the economics of producing ethanol are advantageous, we’re seeing a record level being blended into the pool,” said Ilshat Haris, managing director and partner with Boston Consulting Group.

E15 is currently sold at around 4,300 gas stations across the country. Though this is still a small share of the 150,000 stations nationwide, it’s growing. The Renewable Fuels Association reports E15 can be up to 39 cents per gallon cheaper than traditional E10 gasoline, adding to its appeal.

This ethanol demand could be key for farmers, who planted 95.2 million acres of corn this spring—the most since 2013. Corn prices fell to $4.06 per bushel in early June due to expectations of a record harvest.

Chris Boshart, CEO of Gold-Eagle Cooperative, said, “From a corn standpoint, we need these plants up and running at full.”

With federal renewable fuel standards requiring roughly 15 billion gallons of ethanol use this year, experts like Ben Brown from the University of Missouri believe strong summer demand may help reach or exceed that goal.