12 September 2013 11:08 [Source: ICIS news]
LONDON (ICIS)--European T2 fuel ethanol prices decreased for the second consecutive week on lower demand and softer feedstock prices, sources said late on Wednesday.
T2 prices were assessed at €558-565/cbm ($744-753/cbm) FOB (free on board) Rotterdam, down by €17-20/cbm from the previous week.
“Raw material pricing is the driver behind lower prices – the wheat crop is good,” one trader said.
“The summer driving season has come to an end as a result of poorer weather conditions,” the trader added.
A backwardated market structure remains evident in Europe, with October prices quoted at €560/cbm FOB Rotterdam and December values at €525/cbm FOB Rotterdam.
Another source said that November values are quoted at €470/cbm FOB Rotterdam, but conceded, along with others, that this was an unlikely number.
“I think €470/cbm FOB Rotterdam for November is a bit improbable – the cost of production will be the floor, so around €520/cbm FOB Rotterdam,” the source said.
“There is concern that gasoline sales won’t be good for the rest of the year and that the EU will be swimming in its own ethanol. This could be why the market is backwardated,” the source added.
($1 = €0.75)
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