Ethanol Tumbles Against Gasoline as Corn Declines
By Mario Parker
Ethanol tumbled, widening the discount to gasoline, as cheaper corn enabled distillers to boost production of the biofuel.
The spread widened 7.38 cents to 79.99 cents a gallon, the biggest one-day expansion since Oct. 4. Pratt Energy said Oct. 24 that it restarted operations at a plant that was idle for more than five years.
“There’s been news of plants coming back online,” said Will Babler, a broker at Atten Babler Risk Management in Galena, Illinois. “It seems like production is trending higher.”
Denatured ethanol for November delivery fell 3 cents, or 1.6 percent, to $1.831 a gallon on the Chicago Board of Trade. Futures are down 16 percent this year.
Gasoline for November delivery rose 4.38 cents, or 1.7 percent, to $2.6309 a gallon on the New York Mercantile Exchange. The contract covers reformulated gasoline, made to be blended with ethanol before delivery to filling stations.
Farmers planted a record number of acres as they sought to recover from last summer’s drought that destroyed yields and raised prices for the grain.
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