Brazil hydrous ethanol prices up on reduced supply - CEPEA

17 January 2012 15:31  [Source: ICIS news]

HOUSTON (ICIS)--Brazil hydrous ethanol prices remained on an uptrend last week, lifted by reduced spot supply following the end of the sugarcane harvest in the country's key centre-south region, research group CEPEA said on Tuesday.

The harvest in the centre-south, which accounts for 90% of Brazil's ethanol output, runs from April to November/December.

CEPEA assessed hydrous ethanol last week at Brazilian reais (R) 1.2240/litre ($2.60/gal, €0.54/litre), up by 2% from R1.2000/litre in the week that ended on 6 January.

The increase extended gains from the previous week, but market participants expect prices to stabilise, adding that a continued uptrend would eventually take a toll on demand.

Hydrous ethanol is used in Brazil as a standalone fuel in flexible-fuel vehicles (FFVs), competing directly with gasoline.

Brazil also uses anhydrous ethanol as a motor fuel, but the product is blended in gasoline at a mandated 20%.

Anhydrous ethanol prices were steady last week at R1.3350/litre, CEPEA said.

($1 = €0.79, R1.78)

For more on ethanol visit ICIS chemical intelligence

By: William Lemos
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