Ethanol futures rose to the highest level in 32 months as congestion along U.S. rail lines slowed deliveries of the biofuel.

Denatured ethanol for April delivery advanced 13.9 cents, or 4.9 percent, to $2.988 a gallon on the Chicago Board of Trade, the highest settlement since July 28, 2011. Winter storms that battered the U.S. Midwest, where about 89 percent of ethanol plants are located, hindered rail traffic.

“Equipment is running about 22 days behind schedule,” said Mike Blackford, a consultant at INTL FCStone in Des Moines, Iowa. “Everything’s horrible. The stockpiles are sitting out there, they’re just sitting on the tracks somewhere.”

Ethanol is more expensive than gasoline for the first time since November 2011.

Gasoline for April delivery slipped 1.7 cents, or 0.6 percent, to $2.8909 a gallon on the New York Mercantile Exchange. The contract covers reformulated gasoline, made to be blended with ethanol before delivery to filling stations.

Ethanol inventories in the PADD 1 region, which covers the East Coast, were at a record-low 4.5 million barrels in the week ended March 14, while supply in PADD 5, on the West Coast, was down 32 percent from a year earlier, data from the Energy Information Administration show.

Shippers Reluctant

Blackford said ethanol producers are hesitant to ship to the coasts out of concern that it will increase the time needed to get rail cars back.

“Unlike with typical weather patterns, railroads have not had the opportunity to recover from severe weather, given that one front has followed another,” Bloomberg Industries said in a March 13 note.

In cash market trading, ethanol in New York Harbor increased 22.5 cents, or 5.7 percent, to $4.175 a gallon, the highest level since 2006, according to data compiled by Bloomberg.

Ethanol in Chicago rose 18 cents, or 5.6 percent, to a record $3.375 a gallon, while on the West Coast, the additive gained 10.5 cents, or 2.7 percent, to $3.98, also an all-time high. In the U.S. Gulf, the additive climbed 8.5 cents, or 2.5 percent, to $3.56 a gallon.

Ethanol production fell 5.6 percent to 891,000 barrels a day in the week ended March 14 from the 944,000 barrels a day averaged on Dec. 6, data from the EIA, Energy Department’s statistical arm, show.

Total stockpiles were at 15.3 million barrels, down 17 percent from a year earlier, according to the EIA.

Renewable Identification Numbers, the tracking certificates used by the government to track consumption targets, traded at 51 cents for 2014 corn-based ethanol, while 2013 RINs were at 53 cents, data compiled by Bloomberg show.

To contact the reporter on this story: Mario Parker in Chicago at mparker22@bloomberg.net

To contact the editors responsible for this story: Dan Stets at dstets@bloomberg.net Charlotte Porter, Bill Banker