U.S. ethanol production rose 2.1 percent to 875,000 barrels a day last week, the most in 11 months, the Energy Information Administration said.
Output climbed for a second week while stockpiles of the biofuel sank 1.5 percent to 16.2 million barrels, the lowest level since Nov. 5, 2010, the Energy Department’s analytical arm said in a report today.
Returns to make the biofuel from a bushel of corn are near the highest levels since 2011, data compiled by Bloomberg show. Prices for the grain have eased on projections that farmers will plant the most acres since 1936 as they seek to rebound from drought that shriveled crops last summer.
Ethanol-blended gasoline made up about 94 percent of the total U.S. gasoline supply in the week ended May 17, down from 95 percent in the previous period and the smallest amount since April 19, EIA data show.
The U.S. hasn’t made any foreign purchases of the biofuel since April 19, the longest such stretch since March 2, 2012, the EIA report showed.
Denatured ethanol for June delivery added 0.5 cent to $2.637 a gallon on the Chicago Board of Trade at 10:11 a.m. local time. Futures have gained 24 percent in the past year.
Corn for July delivery jumped 15.75 cents, or 2.5 percent, to $6.5575 a bushel in Chicago.
The corn crush spread for July was 12 cents compared with minus 35 cents on Dec. 31. The amount doesn’t include revenue from the sale of dried distillers’ grains, a byproduct of ethanol production, which can be fed to livestock.