Bloomberg News

Ethanol Snaps Four-Day Streak of Gains on Global Economic Woes

June 28, 2012

Ethanol snapped a four-day streak of gains on concern the slumping global economy will curtail demand for the biofuel.

Futures fell after a Labor Department report showed applications for jobless benefits last week at 386,000 hovered near the highest level of the year and as European leaders started a two-day summit in Brussels to address the region’s debt crisis.

“Everything was just coming off today, the energies, crude oil was down more than $2,” said John Janney, a vice president at Citigroup Global Markets Inc. in Chicago.

Denatured ethanol for July delivery slipped 0.7 cent, or 0.3 percent, to $2.209 a gallon on the Chicago Board of Trade, the first decline since June 21. Prices have gained 0.3 percent this year.

In cash market trading, ethanol on the West Coast slid 1.5 cent, or 0.6 percent, to $2.335 a gallon and in the U.S. Gulf the additive increased 2 cents, or 0.9 percent, to $2.295, according to data compiled by Bloomberg.

Ethanol in Chicago added 1.5 cents, or 0.7 percent, to $2.21 a gallon and in New York the biofuel climbed 1 cent, or 0.4 percent, to $2.28.

Crude for August delivery declined $2.52 to $77.69 a barrel on the New York Mercantile Exchange, the lowest settlement since October. Futures have fallen 25 percent this quarter, heading for the biggest drop since the final three months of 2008.

To contact the reporter on this story: Mario Parker in Chicago at mparker22@bloomberg.net

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net


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