Northeast Asian hydrous ethanol gap widens on bullish US markets

13 July 2012 08:58  [Source: ICIS news]

SINGAPORE (ICIS)--Northeast Asia’s hydrous ethanol price gap has widened on the back of firmer selling sentiment in line with the gains in corn futures trade, market players said on Friday.

The prices were assessed as up by $20/cbm to $680-720/tonne (€558-590/tonne) CFR (cost & freight) northeast (NE) Asia during the week ended 11 July, reflecting high selling ideas of Brazilian cane-based product as a result of stronger corn futures in the US, according to data from ICIS.

Market players indicated softer buy-sell ideas during the week despite stronger corn futures in the US.

Corn futures on the Chicago Board of Exchange were settled at $7.506/bushel during the week ended 11 July, down by 10.2 cents from the previous day. However, the settlement was up from $7.186/bushel on 3 July.

The gains in the corn futures and overall weak Brazilian currency have led to a bullish selling sentiment in the Brazilian export market, with traders posting firmer indications at the low $700s/cbm CFR Ulsan.

However, buying interest was weak as end-users in Japan and South Korea are covered with product until October and as competitively priced molasses-based cargoes from Pakistan were offered to the market during the week.  

“Many traders are stuck with long positions for hydrous-grade ethanol, which was purchased when market prices were firmer.

“Storage tanks in Ulsan are near full capacity. Any discussions in the market will be for October-arrival shipments at the earliest,” a southeast Asia-based trader said.

Lower offers of $685-693/cbm CFR Ulsan from Pakistan failed to attract buying interest for the same reason, with customers remaining at the sidelines amid an uncertain market outlook.

($1 = €0.82)

By: Andrea Heng
+65 6780 4359

AddThis Social Bookmark Button

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly