Ethanol futures slid to a six-week low in Chicago on speculation that U.S. lawmakers will fail to agree on a plan to reduce the deficit and amid concern that Europe’s debt crisis will spread.
Futures followed crude oil and corn lower. A 12-member congressional debt-reduction committee is expected to announce that it can’t reach agreement on cutting at least $1.2 trillion. Germany’s finance minister said the country’s expansion has become “noticeably slower.”
“It was just a big off-day across the board, so it’s not surprising” that ethanol would fall,” said Justin Dirico, senior ethanol trader at SCB & Associates in Chicago.
Denatured ethanol for December delivery retreated 5.6 cents, or 2.2 percent, to $2.544 a gallon on the Chicago Board of Trade, the lowest price since Oct. 10. The futures have increased 7 percent this year.
Crude oil for January delivery fell 75 cents, or 0.8 percent, to $96.92 a barrel on the New York Mercantile Exchange, the lowest settlement since Nov. 9. The price ranged from $95.24 to $97.86. Futures are up 6.1 percent this year.
Corn for March delivery dropped 13 cents, or 2.1 percent, to $6.05 a bushel in Chicago. One bushel makes at least 2.75 gallons of the biofuel.