Houston (Platts)--16Jan2013/1130 am EST/1630 GMT

Weekly ethanol production in the reporting week ended Friday plunged 42,000 b/d, or 5.1%, to 784,000 b/d, the US Energy Information Administration said Wednesday.

The production level was the lowest recorded by the EIA since it started recording weekly production in the reporting week ended June 4, 2010.

Weekly ethanol inventories, however, reversed course after a three-week decline as they grew 507,000 barrels, or 2.6%, to a four-week high of 20.361 million barrels.

The gain in ethanol stocks was due to stock builds in the East Coast, Gulf Coast and West Coast.

East Coast ethanol inventories jumped 399,000 barrels to 7.657 million barrels, the highest level in more than six months as stocks had not been this high since the reporting week ended June 29, when they were at 7.78 million barrels.

Gulf Coast ethanol stocks moved up for the first time in four weeks as they climbed 156,000 barrels to 3.277 million barrels. West Coast inventories surged 325,000 barrels to 2.649 million barrels, the highest recorded level by the US EIA since it started recording weekly ethanol stocks in the reporting week ended June 4, 2010.

Midwest ethanol inventories, on the other hand, dropped 371,000 barrels to a three-week low of 6.491 million barrels, while stocks in the Rocky Mountain region were on a four-week slide as they edged down 1,000 barrels to an 11-week low of 287,000 barrels.

The weekly refiner and blender net ethanol input rose 57,000 b/d, or 8%, to 771,000 b/d. As the increase in the weekly refiner and blender net input was greater than that of the weekly ethanol stocks, the ethanol days of supply -- calculated by dividing weekly ethanol stock levels by weekly refiner and blender ethanol net inputs -- declined 1.4 days to 26.4 days of supply.

Weekly ethanol imports shrank 25,000 b/d to a three-week low of 27,000 b/d.

The weekly overall amount of gasoline produced increased 205,000 b/d to 8.59 million b/d as the weekly amount of gasoline blended with ethanol jumped 658,000 b/d to 7.743 million b/d. As the gain in the weekly overall amount of gasoline blended with ethanol outpaced the increase in the weekly overall amount of gasoline produced, the weekly ethanol blending percentage rose 5.6 percentage points to a four-week high of 90.1%.

The amount of gasoline blended with ethanol is calculated by adding the volume of reformulated gasoline blended with ethanol and conventional gasoline blended with ethanol. The ethanol blending percentage is calculated by dividing the weekly amount of gasoline blended with ethanol by weekly total gasoline production.

The four-week rolling average of gasoline demand fell 75,000 b/d to 8.364 million b/d, the lowest level in eight months as it had not been this low since the reporting week ended March 16, when it was at 8.355 million b/d. Gasoline demand was only 0.6% below where it was at this time last year. Year-to-date, current gasoline demand levels were 1.4% below those of 2012.

--Shameek Ghosh, shameek_ghosh@platts.com

--Edited by Richard Rubin, richard_rubin@platts.com

© 2013 Platts, The McGraw-Hill Companies Inc. All rights reserved.  To subscribe or visit go to:  http://www.platts.com