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CVR Energy, Inc. Message Board

  • gladpick gladpick Apr 3, 2013 3:11 PM Flag

    crazy hedge funds speculation

    From Bloomberg:

    "Ethanol’s discount to gasoline narrowed on concern that cheaper corn won’t be enough to boost output of the fuel to the levels before last year’s drought.
    The spread, based on May contracts, contracted 7.59 cents to 60.59 cents a gallon at 10:47 a.m. New York time after the Energy Information Administration said output increased 0.2 percent to 807,000 barrels a day in the week ended March 29. That’s 16 percent below the December 2011 record high and 4.8 percent above the all-time low reached Jan. 25."

    CVI and CVRR will do well in the long run The ethanol credit that they need to buy was over one dollar based on speculation but now is about 60 cents and I suspect it will go down further. Farmers traditionally turn to crops that have appreciated the prior year and I suspect there will be a glut of corn this coming season. There have been times that storage facilities could not accommodate crops and farmers ended up storing their crops on the main street next to storage facilities. It may happen again with corn!

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