15 July 2009 21:20 [Source: ICIS news]
HOUSTON (ICIS news)--Brazil’s ethanol exports in April-June fell by 10.5% to 985m litres (261m gal) from 1.1bn litres a year earlier due to a drop in shipments to the US, Brazilian sugarcane industry association Unica said on Wednesday.
Exports of anhydrous ethanol to the US in April-June plummeted to 22m litres, down 94.1% from 376m litres in the same months of 2008, the association said.
The slump is due to a drop in US prices and a US tariff on Brazilian ethanol, which has closed the arbitrage window for direct shipments of the product, Unica said.
According to Unica, the reduction in direct exports to the US has been offset by a large increase in exports to India, Japan and South Korea.
However, the association did not provide shipment figures for those markets.
Unica releases data starting in April because that is when the sugarcane harvest begins in the centre-south region.
The centre-south accounts for nearly 90% of Brazil’s ethanol production.
Market participants said export activity in Brazil remained weak in July because of a jump in local ethanol prices and continued weakness in the US market.
The arbitrage window with the US is closed even for material shipped through the Caribbean, according to sources in Brazil.
Brazil’s centre-south ethanol exports in April-December 2008 totalled 3.9bn litres, a 74% increase from the same period one year earlier, according to data from Unica.
The US was the main destination for the product, accounting for 57% of the shipments.
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