Ethanol increased to the highest price in more than a month, rising with corn on speculation that hot, dry weather will reduce U.S. yields.
Much of Illinois, Indiana, eastern Iowa and Missouri have had less than half the normal amount of rain in the past 30 days, National Weather Service data show. About 70 percent of Illinois, the biggest corn and soybean grower except for Iowa, is in moderate to extreme drought. Corn is beginning to reproduce, making this the most critical time for moisture.
Denatured ethanol for July delivery rose 2.2 cents, or 1 percent, to $2.186 a gallon on the Chicago Board of Trade. The increase was the third in a row.
Corn for December delivery climbed 30 cents, or 5.1 percent, to $6.24 a bushel on CBOT. It was the highest settlement price for a most-active contract since September.
In cash market trading, ethanol rose 6.5 cents to $2.245 a gallon in the U.S. Gulf, 10 cents to $2.325 on the West Coast, 6.5 cents to $2.24 in New York and 7 cents to $2.18 in Chicago.
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