The spot price for a gallon of ethanol has fluctuated in a narrow range between about $1.40 and $1.50 for the past six weeks. The September report from the U.S. Department of Agriculture indicated that the corn crop for this year faces some hurdles, and that has pushed the spot price from around $1.45 a gallon at the beginning of the month to around $1.50 currently.

Historically, however, the price of ethanol (and corn) fall in September, and that is not good news, either for farmers or ethanol producers like Pacific Ethanol Inc. (NASDAQ: PEIX), Archer Daniels Midland Co. (NYSE: ADM) and Valero Energy Corp. (NYSE: VLO).

Over the past month, stock prices have dropped by more than 9% at ADM, more than 11% at Pacific Ethanol and more than 13% at Valero.

When Valero reported second-quarter results, operating income from ethanol fell from $187 million in the year-ago quarter to $108 million, which the company attributed to lower gross margin per gallon driven by the decline in both gasoline and ethanol prices. That combination more than offset lower corn prices.

ADM reported bioproducts division operating profit of $43 million, compared with $145 million in the second quarter a year ago, and noted that exports and demand in the United States were more than offset by lower margins due to record production.

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The news was worst at Pacific Ethanol, where operating income for the second quarter totaled $2.3 million, compared with $29.3 million a year ago. The company sold more but the average price per gallon was much lower.

Investors pushed shares of Pacific Ethanol up about 5% Tuesday morning for no immediately apparent reason. And if an analysis at Platts is correct, there is no non-immediate reason for the boost:

If this September plays out anything like the last four Septembers have, prices will soon be packing their bags and heading south for the fall.

Platts also notes that the price of ethanol tracks closely with the price of corn — if ethanol goes down a little, ethanol goes down a little; if corn goes down a lot, ethanol goes down a lot. Over the past four years, corn futures have averaged a September drop of 12.6% and ethanol has averaged a drop of 17.3%.

Platts is not expecting a similar drop this year, but it does note that based on an ethanol price of $1.45 a gallon at the end of August, a 17% drop would put the price down around $1.20 a gallon, a level not seen since June of 2005.

Ethanol stockpiles are also at their best-ever level for August, with 18.68 million barrels in storage, about 1 million barrels more than a year ago and 2 million barrels more than August of 2013.

The ethanol makers are keeping a sharp eye on corn prices and investors would be well advised to do the same. Although corn has shown strength in the first half of September, there are still two more weeks to run, and unless corn goes against its recent history, prices both for corn and ethanol will be higher at the end of the month.

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Pacific Ethanol shares traded up about 5.7% to $6.87 in the mid-morning Tuesday. The stock’s 52-week range is $6.11 to $19.45.

ADM stock traded up about 0.7%, at $43.22 in a 52-week range of $41.63 to $53.91.

Valero shares traded down about 0.3%, at $60.57 in a 52-week range of $42.53 to $71.50. Of the three, Valero is most directly affected by the price of crude oil, which was up more than 1% Tuesday morning.

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