April 26 (Bloomberg) -- Ethanol futures climbed in Chicago as overseas demand for corn signaled higher production costs for the biofuel.
Prices rose along with corn after the Agriculture Department said sales of the grain for delivery before Aug. 31, 2013, were more than double the level a week earlier. In the first three days of this week, the department reported sales to China and unknown destinations totaling 1.28 million metric tons. Ethanol in the U.S. is derived from corn.
“It just followed the corn market,” said John Janney, a vice president at Citigroup Global Markets Inc. in Chicago.
Denatured ethanol for May delivery rose 0.1 cent to settle at $2.154 a gallon on the Chicago Board of Trade. Prices have dropped 2.2 percent this year.
In cash market trading, ethanol was unchanged in Chicago at $2.14 a gallon and in the U.S. Gulf at $2.20, according to data compiled by Bloomberg.
Ethanol on the West Coast fell 2 cents, or 0.9 percent, to $2.29 a gallon and in New York the biofuel sank 3.5 cents, or 1.5 percent, to $2.235.
Corn futures for July delivery advanced 6.5 cents, or 1.1 percent, to $6.075 a bushel in Chicago, the first increase in three days.
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