June 27, 2012

US ethanol, corn prices up to highest level

On speculation that hot, dry weather will decrease US yields, US ethanol and corn prices increased to the highest level in more than a month.

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% of Illinois, the biggest corn and soy 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 US$0.022, or 1%, to US$2.186 a gallon on the Chicago Board of Trade. The increase was the third in a row.

Corn for December delivery climbed US$0.30, or 5.1%, to US$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 US$0.065 to US$2.245 a gallon in the US Gulf, US$0.10 to US$2.325 on the West Coast, US$0.065 to US$2.24 in New York and US$0.07 to US$2.18 in Chicago.