Nov. 8 (Bloomberg) -- Ethanol futures gained in Chicago on higher prices for corn and crude oil.
The biofuel increased a day before the U.S. Agriculture Department releases its World Agriculture Supply and Demand Estimates report, which may forecast reduced corn output. The grain is the primary ingredient for U.S. ethanol production. Oil gained after Italian Prime Minister Silvio Berlusconi offered to step down.
“A lot of it is corn and crude,” said Matt Janney, a trader at Citigroup Global Markets Inc. in Chicago. “There’s a lot of uncertainty on tomorrow’s WASDE report and there’s overall position squaring.”
Denatured ethanol for December delivery rose 1.5 cents, or 0.6 percent, to $2.674 a gallon on the Chicago Board of Trade. The futures have increased 12 percent this year.
In cash market trading, ethanol was unchanged in New York at $3.01 a gallon and in the U.S. Gulf at $2.955, according to data compiled by Bloomberg.
Ethanol in Chicago increased 7 cents, or 2.5 percent, to $2.85 a gallon and on the West Coast the biofuel dropped 4 cents, or 1.3 percent, to $3.085.
Crude oil for December delivery rose $1.28 to $96.80 a barrel on the New York Mercantile Exchange, the highest settlement since July 28. Futures are up 5.9 percent this year.
Corn for December delivery gained 7.25 cents, or 1.1 percent, to $6.605 a bushel in Chicago. One bushel makes at least 2.75 gallons of ethanol.
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