Ethanol futures fell to the lowest price in more than five months in Chicago on cheaper production costs and ample stockpiles.
Prices sank as corn, the primary feedstock used to make the biofuel in the U.S., decreased on lackluster overseas demand and after a May 18 Energy Department report showed supply surged to 21.4 million barrels, the steepest weekly gain since Jan. 27.
Denatured ethanol for June delivery plunged 6.2 cents, or 2.9 percent, to settle at $2.073 a gallon on the Chicago Board of Trade, the lowest price since Dec. 15.
Corn futures for July delivery fell 25 cents, or 4.1 percent, to close at $5.785 a bushel on the Chicago Board of Trade. Ethanol has fallen 5.9 percent this year and corn is down 11 percent.
“Anytime corn wants to move, that’s what it’s going to do,” Blackford said.
In spot market trading, ethanol in New York lost 4.5 cents, or 2 percent, to $2.16 a gallon and in Chicago the additive decreased 2.5 cents, or 1.2 percent, to $2.095, according to data compiled by Bloomberg.
Ethanol in the U.S. Gulf dropped 1.5 cents, or 0.7 percent, to $2.16 a gallon and on the West Coast the biofuel increased 1 cent, or 0.4 percent, to $2.35.
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