Ethanol futures fell a fourth day in Chicago as supply of the biofuel outpaced demand.
Prices extended the longest streak of losses this year a day after the Energy Department said ethanol supply rose 3 percent to a record 22.7 million barrels last week. Production of conventional gasoline mixed with the biofuel fell 0.6 percent to 5.11 million barrels, the report showed.
“The feeling in the market is that there’s a lot of ethanol to be sold,” said Jim Damask, a manager at Biofuelsconnect, a Jupiter, Florida-based alternative energy broker. “There is a ton of inventory out there.”
Denatured ethanol for April delivery fell 0.3 cent to $2.283 a gallon on the Chicago Board of Trade. Prices have risen 3.6 percent this year.
Production rose to 893,000 barrels a day last week from 892,000, the Energy Department said. That’s equal to about 13.7 billion gallons of the fuel on an annualized basis.
Ethanol is blended with gasoline to stretch supply and meet federal mandates.