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Ethanol futures followed corn lower, declining to a two-week low in Chicago.
The alternative fuel slid on speculation that good weather will prompt farmers to plant the most acres of corn since 1944. A March 21 Energy Department report showed ethanol stockpiles grew to a record 22.7 million barrels the previous week.
“It’s just a market that wants to tag along with whatever corn is doing,” said Mike Blackford, a consultant at INTL FCStone Inc. in Des Moines, Iowa. “We built stocks again last week, so we haven’t alleviated the problem yet.”
Denatured ethanol for April delivery slipped 1.7 cents, or 0.7 percent, to $2.275 a gallon on the Chicago Board of Trade, the lowest price since March 9. Prices have increased 3.3 percent this year.
In cash market trading, ethanol in Chicago was unchanged at $2.275 a gallon and in New York the additive increased 0.5 cent to $2.365, according to data compiled by Bloomberg.
Ethanol on the West Coast added 0.5 cent to $2.41 a gallon and in the U.S. Gulf the biofuel sank 0.5 cent to $2.32.
Corn futures for May delivery fell 8.75 cents, or 1.4 percent, to $6.3775 a bushel in Chicago. One bushel makes at least 2.75 gallons of ethanol.
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