Ethanol futures snapped a three-day decline as the Energy Department reported that inventories fell 1.4 percent last week.
The biofuel gained as stockpiles fell 1.4 percent to 19 million barrels and production slipped 0.4 percent to 797,000 barrels a day. U.S. ethanol is made from corn and blended into gasoline.
“There was some pessimism you might get a big inventory build that you didn’t get this week,” said Jerrod Kitt, director of research at Linn Group in Chicago. “I think that probably helped the market.”
Denatured ethanol for November delivery climbed 1.6 cents, or 0.7 percent, to $2.391 a gallon on the Chicago Board of Trade. The price has risen 8.5 percent this year.
In cash market trading, ethanol increased 0.5 cent to $2.47 a gallon in New York, 2.5 cents to $2.39 in Chicago and 1.5 cents to $2.45 on the Gulf Coast. It fell 3 cents to $2.535 on the West Coast.
Corn for December delivery increased 7.25 cents to $7.455 a bushel in Chicago. One bushel makes at least 2.75 gallons of ethanol.
Crude oil for November delivery climbed 3 cents to $92.12 a barrel on the New York Mercantile Exchange.
Gasoline for November delivery slid 6.36 cents to $2.7817 a gallon on the Nymex, the fifth consecutive decline. The contract covers reformulated gasoline, made to be blended with ethanol before delivery to filling stations.
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