02 May 2012 05:51 [Source: ICIS news]
SINGAPORE (ICIS)--Asia’s hydrous ethanol prices are expected to remain at their current levels with some firming up expected in the third quarter because of tightening supply from ?xml:namespace>
Sugarcane production in
However, market players said
A persistent drought has plagued the country since late 2011, according to media reports.
In addition, there has been a larger volume of ageing cane crop, making the crop turnover slower, the reports said.
“The [ethanol] supply will be tight because of these two factors, but not as bad as that in 2011,” a southeast Asia-based ethanol trader said.
According to the Brazilian Sugarcane Industry Association (UNICA), a total of around 509m tonnes are expected to be produced, which is 3.19% higher than the previous harvest but still lower than the government’s estimate.
As a result of the low harvest at the time, the prices of hydrous ethanol for export to countries such as
In 2012, the market for hydrous B-grade ethanol started on a firm note with offers at as high as $820/cbm CFR NE Asia, but prices gradually declined, according to data from ICIS.
During the later part of the first quarter, buying demand slowed down because of comfortable inventory levels among customers, and sellers lowered their prices as a result of the weak demand to spur buying interest.
Over the last two weeks, offers of Brazilian hydrous ethanol have hovered at $770-780/cbm but buyers’ response has been weak this week because major buyer
In addition, the depreciation of the Brazilian real (R) to R1.88 against the US dollar from R1.82 two weeks ago has made it unviable to sell ethanol at high prices.
($1 = €0.76)
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