U.S. ethanol production is expected to increase by 20 percent over last year, according to the latest numbers that reflect production through August.

The Renewable Fuels Association released the newest data from the Energy Information Administration showing that U.S. ethanol producers were averaging 329,000 barrels per day of ethanol production in August.

That is a record for daily production average and an increase of 69,000 b/d from August 2005. For the first eight months of 2006, ethanol production is averaging 305,000 b/d, which translates into nearly 4.7 billion gallons of ethanol a year. These numbers, of course, will continue to grow as additional ethanol biorefineries will continue to come online.

Meanwhile, demand for ethanol in August averaged 385,000 barrels per day.