HOUSTON (ICIS)--US industrial ethanol contract prices for the second quarter of 2014 were assessed higher by 15 cents/gal on Friday.
The price for 200 proof industrial ethanol rose to $3.92-4.02/gal, while 190 proof industrial ethanol rose to $3.72-3.82/gal.
LyondellBasell announced the increase in a customer letter obtained by ICIS, which stated the company was instituting the increase effective 1 April.
A source said that ethanol producers GPC, MGP Ingredients and Archer Daniels Midland (ADM) all followed suit.
According to a customer letter from MGP Ingredients dated 20 March, which was obtained by ICIS on 28 March, the price increase was due to the rising price of corn futures, which traded in the $4.20s/bushel range at the start of 2014.
Corn futures have been on an upward trajectory ever since, settling at $4.92/bushel on 27 March.
Another source said that the lack of rail cars that has plagued the fuel ethanol industry was also helping to support industrial ethanol prices.
Fuel ethanol prices rose to their highest level since 2006 during the week ending 28 March.
Additionally, industrial ethanol supplies have been tight in the first quarter as a result of an active flu season and increased exports.