Bloomberg News

Ethanol Advances Most in Two Weeks on Signs of Stronger Economy

November 15, 2011

Nov. 15 (Bloomberg) -- Ethanol futures in Chicago advanced the most in more than two weeks on signs of a stronger U.S. economy that could boost demand for fuels.

Futures gained after the Commerce Department said retail sales rose 0.5 percent last month, higher than the 0.3 percent forecast in a Bloomberg News survey. Ethanol, mixed with gasoline, is part of U.S. energy plans to reduce dependence on crude oil imports.

“That’s good news to the market,” said Dan Flynn, a trader at PFG Best in Chicago. “Energy prices are higher, corn’s picking up. It’s just tailor-made for ethanol to go higher.”

Denatured ethanol for December delivery rose 2.8 cents, or 1.1 percent, to $2.68 a gallon on the Chicago Board of Trade, the highest price since Nov. 3 and the steepest gain since Oct. 27. Futures have increased 13 percent this year.

In cash market trading ethanol in New York climbed 5 cents, or 1.7 percent, to $3.01 a gallon and in Chicago the additive increased 15 cents, or 1.1 percent, to $2.84, according to data compiled by Bloomberg.

Ethanol in the U.S. Gulf added 2 cents, or 0.7 percent, to $2.985 a gallon and on the West Coast the biofuel was unchanged at $3.045.

Crude oil for December delivery rose $1.23, or 1.3 percent, to $99.37 a barrel on the New York Mercantile Exchange, the highest settlement price since July 26. Futures reached an intraday high of $99.84.

Gasoline for December delivery gained 5.04 cents, or 2 percent, to $2.5857 a gallon in New York. The contract includes reformulated gasoline, which is made to be blended with ethanol before delivery to filling stations.

Corn for December delivery jumped 12 cents, or 1.9 percent, to $6.455 a bushel in Chicago. The grain is the primary input used to make ethanol in the U.S.

--Editors: Bill Banker, Charlotte Porter

To contact the reporter on this story: Mario Parker in Chicago at

To contact the editor responsible for this story: Dan Stets at

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