Dec. 9 (Bloomberg) -- Ethanol futures fell, capping the worst week in three years, on lower demand for the biofuel and cheaper corn.
Futures decreased after an Agriculture Department report showed unsold supply of U.S. corn before next year’s harvest will be 0.6 percent larger than a previous estimate. The department said demand for corn to make ethanol will slip to 5 billion bushels from 5.021 billion a year earlier.
“We had the report that came in line pretty much with what people were expecting,” said Justin Dirico, senior ethanol trader at SCB & Associates in Chicago.
Denatured ethanol for January delivery fell 1.8 cents, or 0.8 percent, to $2.115 a gallon on the Chicago Board of Trade, the lowest price in 52 weeks. Futures dropped 16 percent this week, the worst performance since December 2008. Prices have dropped five of the past six weeks.
In cash market trading, ethanol on both the West Coast and in New York increased 12.5 cents, or 5.2 percent, to $2.55 a gallon, according to data compiled by Bloomberg.
Ethanol in the U.S. Gulf jumped 7.5 cents, or 3.1 percent, to $2.525 a gallon and in Chicago the biofuel rose 2 cents, or 0.9 percent, to $2.325.
Corn for March delivery slumped 6 cents, or 1 percent, to $5.9425 a bushel in Chicago. One bushel makes at least 2.75 gallons of ethanol.
--With assistance from Jeff Wilson in Chicago. Editors: Richard Stubbe, David Marino
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