Ethanol futures fell the most in more than a week as production costs for the biofuel eased.
Prices followed corn lower on speculation supply will be more plentiful than expected. The U.S. Agriculture Department said Nov. 9 that the corn crop will total 10.725 billion bushels, up from an October estimate of 10.706 billion. Ethanol is made from the grain in the U.S. and the profit from making the biofuel is referred to as the crush margin.
“Crush margins are a little stronger today,” said Michael Breitenbach, an analyst and trader at Blue Ocean Brokerage LLC in New York.
Denatured ethanol for December delivery fell 5.4 cents, or 2.3 percent, to $2.327 a gallon on the Chicago Board of Trade, the steepest drop since Nov. 2. Futures have risen 5.6 percent this year.
In cash market trading, ethanol in New York dropped 3 cents, or 1.2 percent, to $2.47 a gallon and in Chicago the additive decreased 2 cents, or 0.8 percent, to $2.36, data compiled by Bloomberg show.