Ethanol price posts fourth consecutive daily gain on CBOT after U.S. DOE report cited increased demand for the biofuel for blending with gasoline; report also indicates inventory declines in oil and gasoline
December 22, 2011
– For the fourth consecutive day, ethanol prices were up on the Chicago Board of Trade, extending the longest string of gains since November, although futures are still down for the year, reported Bloomberg News on Dec. 21.
The uptick in prices came after the U.S. Dept. of Energy (DOE) released a report indicating that output of a blend of conventional gasoline and ethanol increased 2.2% to 5.26 million barrels per day last week, the highest production level since Aug. 12.
The report also noted that inventories of oil and gasoline fell. Oil was down by 10.6 million barrels to 323.6 million barrels, the steepest decline since Feb. 16, 2001, while gasoline stockpiles fell by 412,000 barrels to 218.4 million barrels, Bloomberg reported
The CBOT price for denatured ethanol for January delivery was up by US$0.017, or 0.8%, to settle at $2.157 per gallon.
However, ethanol futures are still trailing by 9.3% for the year, heading for the first yearly drop since 2008. On Dec. 31, refiners will lose the $0.45/gallon tax credit that applies to every gallon of gasoline mixed with ethanol, reported Bloomberg.
In cash market trading, ethanol was down by $0.005 cents to $2.20/gallon in Chicago; unchanged at $2.325/gallon in the U.S. Gulf; down $0.11, or 4.8%, to $2.205/gallon on the West Coast; and off $0.025, or 1.1%, to $2.275/gallon in New York, according to data compiled by Bloomberg.
Crude oil for February delivery was up by $1.43, or 1.5%, to $98.67/barrel on the New York Mercantile Exchange.
Gasoline intended for mixing with ethanol before delivery to filling stations, for January delivery, rose by $0.0412, or 1.6%, to $2.6199/gallon in New York, Bloomberg reported.
The primary source of this article is Bloomberg News, New York, New York, on Dec. 21, 2011.