Brazil ethanol prices continue to fall despite firmer demand

07 February 2012 16:12  [Source: ICIS news]

HOUSTON (ICIS)--Brazil ethanol prices fell again last week as ample supply outstripped a small increase in demand, research group CEPEA said on Tuesday.

CEPEA assessed hydrous ethanol at Brazilian reais (R) 1.0776/litre ($2.37/gal, €0.48/litre), down by 1.6% from R1.0956/litre in the week that ended on 27 January.

Anhydrous ethanol prices were assessed at R1.1560/litre, down by 0.8% from R1.1652/litre a week earlier.

Hydrous ethanol is used in Brazil as a standalone fuel in flexible-fuel vehicles (FFVs), competing directly with gasoline, while anhydrous ethanol is blended in gasoline at a mandated 20%.

CEPEA attributed supply pressure in Brazil to inventory reduction by some sugarcane mills in the key centre-south region.

The centre-south accounts for 90% of Brazil's ethanol production.

($1 = €0.76, R1.72)

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By: William Lemos
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