05 November 2008 08:37 [Source: ICIS news]
SINGAPORE (ICIS news)--Asian hydrous ethanol dropped sharply by $40-50/tonne from a week ago to $680-690/tonne on the back of plunging prices in the world’s largest ethanol exporter Brazil, said ethanol buyers and sellers on Wednesday.
Cargoes were sold in Korea at around $680/tonne CFR (cost and freight) NE (northeast) Asia in the past couple of days as traders sought to liquidate inventory amid plummeting prices, said an Asian ethanol trader.
Offers for Brazilian cargoes were now around $540-550/cbm ($675/tonne) CFR Korea, down some $60/tonne from the previous week as sellers dumped cargoes amid the ongoing credit and cash flow problems.
The strengthening of the US dollar and weakness in Brazilain rial has also contributed to the downward pressure in prices, said traders.
“With Obama winning, the US dollar is likely to strengthen further and the downside risk to prices is still there,” said a ?xml:namespace>
In the case of anhydrous ethanol, offers were heard around $730-750/tonne CFR SE Asia but there was hardly any buying interest in the present market, said some ethanol sellers.
“Buyers are jittery now and don’t want to hold any stocks. The recent bankruptcy of VeraSun, a large
Pakistani ethanol exporters, who saw good business earlier this year, are also bracing for hard times.
“Our sugarcane crop is expected to fall by 30% this year and on top of that, ethanol prices are falling. So we are in for tough times,” said a Pakistani distiller.
Large ethanol traders in
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