Bloomberg News

Ethanol Snaps Three-Day Streak of Gains on Signs of Oversupply

August 22, 2012

Ethanol futures fell for the first time in four days after stockpiles of the fuel increased from a week earlier.

Prices declined after the Energy Department said inventories climbed 46,000 barrels to 18.5 million, up 1.4 percent from a year earlier. Production of conventional gasoline blended with ethanol was steady at 5.42 million barrels a day.

“It was just a knee-jerk reaction that you didn’t get a draw,” said Jerrod Kitt, an analyst at Linn Group in Chicago.

Denatured ethanol for September delivery fell 0.3 cent to settle at $2.664 a gallon on the Chicago Board of Trade. The futures have gained 21 percent this year.

In cash market trading, ethanol rose 2 cents to $2.73 a gallon in New York and 0.5 cent to $2.79 on the West Coast, data compiled by Bloomberg showed. The price fell 1.5 cents to $2.635 in Chicago and 1.5 cents to $2.695 on the Gulf Coast.

The value of Renewable Identification Numbers, known as RINs, fell 4 percent to 3.65 cents, data compiled by Bloomberg show. They are credits that help the government track whether refiners are meeting 2012 federal ethanol use mandates.

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


We Almost Lost the Nasdaq
LIMITED-TIME OFFER SUBSCRIBE NOW

(enter your email)
(enter up to 5 email addresses, separated by commas)

Max 250 characters

 
blog comments powered by Disqus