Brazil ethanol demand up but prices fail to climb

15 June 2010 18:53  [Source: ICIS news]

ST. LOUIS, Missouri (ICIS news)--Brazilian ethanol prices continued to drop in the week ended 11 June despite a small increase in demand late in the week, research group CEPEA said on Tuesday.

CEPEA assessed hydrous ethanol at Brazilian reais (R) 0.7020/litre ($1.48/gal), a drop of 0.5% from R0.7054/litre in the week ended 4 June.

Anhydrous ethanol was assessed at R0.8023/litre, down by 1.8% from R0.8167/litre a week earlier.

The downtrend in Brazil was caused by selling pressure amid a drop in ethanol values in the last three sugarcane harvests, the group said, adding that lower prices have squeezed cash flows in the industry.

CEPEA’s price assessments are ex-tank and do not include taxes.

Brazil uses hydrous ethanol as a stand-alone fuel in flexible-fuel vehicles (FFVs), while anhydrous ethanol is blended in gasoline at a mandated 25%.

($1 = R1.80)

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By: William Lemos
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